CIT Says It Can Order Refunds for Plaintiffs' Finally Liquidated Entries in 1581(i) IEEPA Cases

Judges Gary Katzmann, Timothy Reif and Jane Restani said the court has the inherent authority to order reliquidation in cases brought under Section 1581(i), the court's "residual" jurisdiction used, among other things, to contest the underlying legality of certain tariffs. The court also noted the government's position that it won't contest CIT's ability to order such reliquidation, ruling that the U.S. is barred from changing its position in the future.

The issue arose as companies flock to the trade court to potentially secure their refund rights for IEEPA tariffs, should the high court strike down the duties. Leading the charge are attorneys at Crowell & Moring, who urged the trade court for a preliminary injunction on the theory that the companies have no basis to file a protest, since CBP rotely applies the IEEPA tariffs, and that CIT may not have the authority to order reliquidation (see 2512040044). In response, the U.S. said it won't oppose or object to the court's authority to order reliquidation of the plaintiffs' entries (see 2512120033).

The trade court seized on the government's assurances in rejecting Crowell's preliminary injunction. The court said the U.S. will be "judicially estopped" from going back on its word regarding the "availability of relief in the form of reliquidation." The government convinced the court to accept that importers who filed suit under Section 1581(i) can get refunds via reliquidation and that importers won't experience irreparable harm due to liquidation, and, as a result, the U.S. can't later "assume a contrary position" to argue that refunds aren't available after liquidation.

The three judges distinguished the present case from the Section 301 litigation, in which the U.S. did contest CIT's ability to order reliquidation of finally liquidated entries. In the Section 301 case, the trade court granted a preliminary injunction against liquidation of affected entries due to doubt from the U.S. Court of Appeals for the Federal Circuit about CIT's authority to order reliquidation or refunds in Section 1581(i) cases.

The court said, in fact, it held in the Section 301 litigation that the court has the ability to order reliquidation in Section 1581(i) cases, adding that it agrees now that this is the case. While such authority is limited in Section 1581(a) cases, which require a protest to be filed before CBP prior to judicial review, filing a protest now would be an "utter futility," since CBP is "powerless to perform any active role in the determination of the constitutionality of the assessment."

Katzmann, Reif and Restani cited the 2001 CAFC decision in Thomson Consumer Elecs. v. U.S. for the proposition that the trade court can order the reliquidation of finally liquidated entries in Section 1581(i) cases challenging the underlying legality of the subject tariffs. "As long as this court has jurisdiction under 28 U.S.C. § 1581(i), the court can provide remedial relief, as the Government here acknowledges."

Since the importers are thus "not at risk of experiencing irreparable harm as a result of liquidation," the court denied the injunction request and didn't discuss the remaining factors that go into granting a preliminary injunction.

(AGS Company Automotive Solutions v. United States, Slip Op. 25-154, CIT Consol. # 25-00255, dated 12/15/25; Judges: Gary Katzmann, Timothy Reif and Jane Restani; Attorneys: Daniel Cannistra of Crowell & Moring for plaintiff AGS Company Automotive Solutions; Catherine Yang for defendant U.S. government)