US Resists Court-Ordered Refunds as New Tariffs Take Shape

The US government is withholding refunds on IEEPA-based tariffs struck down by the Supreme Court on Feb. 20, including a 25% duty on Mexican goods outside USMCA coverage, while simultaneously advancing a replacement tariff regime under Section 122 of the Trade Act of 1974 that could restore duties to 15% within days. Mexican exporters, importers and manufacturers face a dual-track uncertainty: potential reimbursement of overpaid duties amid active government resistance and court-ordered repayment obligations, alongside the near-term reimposition of trade barriers through a more legally durable framework. Companies operating across automotive, retail, agriculture and industrial sectors with US exposure should monitor both the Court of International Trade refund proceedings and the incoming Section 122 tariff schedule.

Washington is withholding reimbursements on tariffs the Supreme Court declared unlawful last month, denying businesses access to funds collected through emergency trade powers that federal courts have since invalidated, the Financial Times reported.

Border enforcement officials have been turning away corporate reimbursement claims and placing holds on formal protests seeking recovery of duties that have already cleared the payment process, according to FT sources. The stonewalling is compounding commercial uncertainty and fueling a new wave of litigation.

More than US$130 billion was collected under the International Emergency Economic Powers Act (IEEPA) before the Supreme Court struck the tariffs down. With the court's decision offering no roadmap for repayment, importers have been left without a clear mechanism for recovering what they are owed.

Efforts to advance the refund process through the courts had previously met with deliberate delay. Trump’s administration sought a 90-day pause from the US Court of Appeals for the Federal Circuit, a request the court turned down on March 2, redirecting the matter to the US Court of International Trade in New York to establish a path forward.

A trade court judge moved on March 4 to compel repayment, ordering the government to begin disbursing refunds to affected importers. Yet US Customs and Border Protection has continued to reject amended filings from companies seeking to strip IEEPA codes from their shipping records and reclaim overpaid duties.

Companies Race to Court Over Tariff Refunds

The legal battle over IEEPA tariff refunds extends to thousands of companies worldwide, which have filed lawsuits challenging the duties and seeking reimbursement.

Major corporations across automotive, retail, consumer goods and manufacturing sectors have moved to protect their refund rights. Auto parts maker BorgWarner filed in December 2025 seeking a ruling that the IEEPA tariffs were unlawful and full reimbursement of duties paid. Goodyear Tire & Rubber filed a protective lawsuit the same month, challenging the emergency-powers tariffs and seeking an injunction against further duties under the same authority. Toyota subsidiaries, Kawasaki Motors and Yokohama Tire filed similar protective suits in November 2025.

Retail and consumer brands have also joined the wave. Costco sued the US government in November 2025 to secure refund rights ahead of the Supreme Court decision. Barnes & Noble filed in December, arguing Trump lacked the authority under IEEPA to impose tariffs at all. J.Crew, Staples and Dole Fresh Fruit Company filed in January 2026, each seeking full reimbursement of duties paid. Luxury brands including Prada and Tom Ford Distribution filed in February and January, respectively, requesting the Court of International Trade to order refunds with interest.

FedEx has filed a separate lawsuit seeking full reimbursement of tariffs paid, while Chinese automaker BYD filed Feb. 9, 2026.

IEEPA-based Tariffs: What the Supreme Court Struck Down

The Supreme Court's invalidation of IEEPA-based tariffs dismantled a broad and layered set of duties covering nearly every major US trading partner.

Mexico, the United States' largest trading partner faced a 25% tariff on all goods outside USMCA coverage from March 4, 2025, with a 10% rate on potash. Canada was hit with a tiered structure:  35% on most non-USMCA goods, 10% on energy and potash, and 40% on goods suspected of transshipment, while China faced fentanyl-linked duties that fluctuated between 10% and 20% throughout the year.

Beyond bilateral measures, the framework imposed a global minimum tariff of 10% on most trading partners, with country-specific rates reaching up to 41%, alongside a parallel regime targeting low-value shipments under US$800 with per-package fees of US$80 to US$200.

Brazil faced a 40% rate justified on political grounds, India a 25% levy tied to its Russian oil imports, and a 25% tariff applied to goods from countries designated as importers of Venezuelan oil.

New Tariffs in the Pipeline

Even as refund battles play out in the courts, the administration is moving to rebuild its trade barriers through a different legal route. Hours after the Supreme Court ruling, Trump signed an executive order establishing a replacement tariff of 10%, with an announcement that the rate would rise to 15%. US Treasury Secretary Scott Bessent confirmed on CNBC that the increase is "likely sometime this week."

The new tariffs are being implemented under Section 122 of the Trade Act of 1974, which allows the president to impose temporary duties for up to 150 days without congressional approval, a legally more durable framework than the emergency powers previously used. 

"They are more slow moving, but they are more robust," Bessent said. "They have survived more than 4,000 legal challenges." He added that he expects the broader tariff structure to be fully restored within five months.

The Office of the US Trade Representative and the Commerce Department will conduct trade studies during the 150-day window, work that could lay the legal groundwork for additional, longer-lasting duties.