CIT Strikes Down the Section 122 Tariffs, but Relief Is Limited to the Plaintiffs

What the court held

Today, a divided three-judge panel of the Court of International Trade held that the administration exceeded its authority under Section 122 when it imposed the temporary 10% global surcharge.

The majority concluded that the proclamation relied on trade and current-account conditions that did not satisfy the specific balance-of-payments requirement Congress placed in the statute. Judge Stanceu dissented.

The ruling is not universal

The court entered relief for the importer plaintiffs before it: the State of Washington, through its importing instrumentality, and private importers Burlap & Barrel and Basic Fun. The remaining state plaintiffs were dismissed for lack of standing, and the court did not extend the injunction to every importer.

That is a critical limitation. CBP is not required by this judgment alone to stop collecting Section 122 duties from nonparties or to refund every importer that has paid them.

An appeal and stay are likely

The government is almost certain to appeal and seek an immediate stay. Until the appellate court acts, importers should not assume that today's decision will produce an immediate operational change at the border.

At the same time, the decision materially strengthens refund claims by importers who paid the surcharge. The question is how those importers preserve and assert those claims while the appeal proceeds.

THE BOTTOM LINE: This is a major merits victory, but not an automatic refund order for nonparties. Importers should identify their Section 122 payments and evaluate preservation steps now.

Tariff Refund Project can analyze your Section 122 duty exposure alongside your IEEPA refund claim and identify whether protests or litigation should be considered.