The following update is drawn from a communication issued by various news sources and primarily the Liberty Justice Center, the national nonprofit law firm that served as lead counsel in V.O.S. Selections v. Trump, the case that originated the IEEPA tariff challenge and produced the Supreme Court’s February 2026 ruling that IEEPA does not authorize the President to impose tariffs. Because of that role, the Liberty Justice Center has been closely tracking the CIT proceedings and provided a detailed account of the June 9 hearing. Susan Thomas, Executive Assistant Commissioner, US Customs/CBP Office of Trade, represented Customs at the hearing and provided updates.
The key takeaway from the hearing: Nobody argued that importers are not entitled to refunds. The entire discussion focused on how the remaining refunds will be processed. Judge Eaton emphasized throughout that the Supreme Court has already determined the IEEPA tariffs were unlawful, and that the objective is to ensure every importer receives every refund to which they are entitled, including interest. Judge Eaton added that the government’s appeal of the ruling is delaying payments to importers.
The scale of the program: To put the size of this effort in context, CBP processed refunds on approximately 338,000 entries during all of 2025. The IEEPA refund program involves more than 53 million entries, approximately $166 billion in duties collected from more than 330,000 importers, making it one of the largest administrative refund efforts the agency has ever undertaken.
Phase 1 Approximately $107 Billion
This is the largest category. CBP reported the following at the hearing:
- More than 16 million entries have been submitted through CAPE
- Approximately $95 billion in refunds is currently moving through the CAPE system
- Approximately $23 billion has already been transmitted to Treasury for payment
- CBP expects that figure to reach approximately $40 billion by the end of June
- Nearly 89% of all Phase 1 refund dollars are already somewhere in the processing pipeline
The primary bottleneck at this point appears to be moving approved refunds through the remaining administrative steps and through Treasury rather than the submission process itself.
Phase 2: Approximately $28.7 Billion
This is the category many members have been asking about. Key details confirmed at the hearing:
- CAPE functionality for reconciliation entries is expected to be completed on June 29, 2026
- This category covers approximately 3.3 million entries
- It represents approximately $28.7 billion in IEEPA duties
- Once this functionality is live, more than 80% of all IEEPA duties collected will be eligible for refund through CAPE
Phase 3 (Finally Liquidated Entries): Approximately $11.4 Billion
For the first time at the hearing, CBP provided a dollar estimate for this category:
- Finally liquidated entries represent approximately $11.4 billion, or about 6.9% of total IEEPA duties collected
- This covers approximately 6.9 million entries
- CBP expects the CAPE buildout to address these entries to be completed by the end of July
An important nuance raised at the hearing: CBP does not yet know how many of these entries are already covered by one of the thousands of individual refund lawsuits currently pending before the CIT. The amount ultimately requiring a separate administrative solution could be significantly smaller than the $11.4 billion figure.
Remaining categories: Several smaller categories totaling approximately $18.9 billion remain outside the current CAPE process, including drawback claims, certain specialized reconciliation scenarios, administrative protests, and other complex entry types. CBP did not provide specific timelines for these at this hearing.
Focus on small businesses: CBP’s own analysis found that between 86% and 96% of affected importers qualify as small businesses. Judge Eaton returned to this point repeatedly, emphasizing that small businesses must have a practical path to their refunds and should not be forced to file individual federal lawsuits simply to recover money that is already legally owed to them.
Judge Eaton specifically praised CBP Commissioner Rodney Scott and the CAPE development team for the speed with which the system was built. While acknowledging that CAPE is still being refined, the court recognized the rapid development as genuine evidence of CBP’s commitment to returning unlawfully collected duties.
The government made clear at the hearing that it intends to continue processing refunds. The remaining debate centers on the procedural mechanism for handling the last categories of entries, particularly certain finally liquidated entries not already before the court through individual lawsuits. This appears to be a question of how, not whether, those refunds will be paid.
A follow-up status conference is scheduled for June 11. We expect further discussion of the remaining categories and the process that will ultimately be used to address them. We will continue monitoring and will provide updates as developments warrant.
