A Clinton-appointed federal judge has ordered the Trump administration to begin refunding an estimated $130 billion to companies after the Supreme Court invalidated tariffs imposed under emergency powers last year. The massive refund process affects more than 1,000 companies that paid duties on imports from nearly every country.

Court Takes Control of Refund Process

Judge Richard Eaton of the U.S. Court of International Trade issued a three-page order Wednesday directing U.S. Customs and Border Protection to calculate what importers would have paid without the now-invalid tariffs. Eaton declared he has sole jurisdiction over all refund cases, stating no other judge will reach contrary conclusions on these matters. The order came in a case brought by Atmus Filtration, Inc., which challenged President Donald Trump’s use of the International Emergency Economic Powers Act to impose sweeping tariffs.

The Supreme Court ruled 6-3 in February that IEEPA does not authorize tariffs, even after a national emergency declaration, because Congress did not clearly grant the executive branch that power. The 1977 law allows presidents to regulate economic transactions in response to foreign threats, but the majority held this does not extend to imposing tariffs. Justice Brett Kavanaugh warned in his dissent that refunding billions would create serious practical consequences and be a mess, noting some importers already passed costs to consumers.

Administration Signals Fight Ahead

Judge Eaton dismissed concerns about chaos during a hearing before issuing his order, saying refunds are not particularly novel and will proceed smoothly. The Trump administration indicated it plans to appeal the order to delay its implementation. Eaton scheduled a closed-door conference with the parties Friday to discuss details of the refund process. All importers who paid the duties are entitled to benefit from the Supreme Court’s ruling, according to the judge’s order.

What This Means for Taxpayers

The refund process could take years to complete as CBP calculates amounts for thousands of companies across multiple industries. The Supreme Court decision represents a significant check on executive power over trade policy, returning authority to Congress. How the Treasury Department manages refunding $130 billion while some costs were already passed to consumers remains unclear. The case underscores ongoing tensions between presidential emergency powers and constitutional limits on executive authority over economic policy matters traditionally controlled by the legislative branch.