FedEx has led the charge in a series of lawsuits against the United States, seeking the return of billions of dollars from "emergency" tariffs imposed by Donald Trump. The move defies the administration and triggers a new wave of legal conflict following the historic US Supreme Court ruling that declared the tariffs illegal. Experts estimate that a lawsuit tsunami totaling $175 billion is set to follow.
Specifically, FedEx filed a lawsuit on Monday in the US Court of International Trade, demanding refunds for emergency duties imposed by President Donald Trump. This represents one of the most high-profile attempts at capital recovery since the Supreme Court ruled last week, in a 6-3 decision, that these specific tariffs were unlawful. Trade lawyers expect a massive surge in litigation as companies move to reclaim billions. However, the exact refund process must first be determined by a lower court, complicating the immediate outlook.
The Supreme Court decision and the $175 billion stake
More than $175 billion in US tariff revenue may now be subject to refunds after the High Court ruled that Trump exceeded his authority. The court found that the President improperly used the International Emergency Economic Powers Act (IEEPA)—a law typically reserved for sanctions—to impose duties on imported goods, according to economists from the Penn-Wharton Budget Model.
"Plaintiffs seek full restitution from the defendants for all IEEPA tariffs they have paid to the United States," the FedEx lawsuit states. FedEx and its logistics arm acted as the importer of record for goods subject to these duties. The Memphis-based giant has not yet disclosed the exact amount it is seeking to recover. The lawsuit names U.S. Customs and Border Protection, its acting head Rodney Scott, and the United States as defendants. Neither the agency nor the White House responded immediately to requests for comment.
The Washington, D.C.-based law firm Crowell & Moring is representing FedEx. The same firm is also representing major corporations such as Costco, Revlon, and EssilorLuxottica in similar IEEPA tariff refund cases.
Who stands to gain from refunds
According to Ron Ciotti of the law firm Hinckley Allen in Boston, importers, distributors, and suppliers appear to have the highest probability of success. These entities typically possess the necessary customs documentation and detailed invoices required to prove the payment of specific duties per product.
"If there was a tariff escalation clause in your contract or a price adjustment clause based on duties, then you may be able to claim a refund," he noted. Conversely, many consumers and small businesses that simply paid higher prices may struggle to provide the clear evidentiary trail needed to link their costs directly to the illegal tariffs.
Political ramifications
California Governor Gavin Newsom, considered a potential Democratic candidate for the 2028 presidential election, has separately called for refund checks to be sent directly to Americans following the Supreme Court's annulment. However, legal experts suggest that despite the political rhetoric, it will be difficult for average consumers to prove eligibility, as tariff costs were often absorbed into final retail prices without explicit documentation.
The bombshell Supreme Court ruling
In a decision characterized as historic and, for some, destabilizing, the US Supreme Court has set off a firestorm at the heart of the American economy and global trade. With geopolitical tensions rising and markets balancing on a tightrope, the nullification of the tariffs acts as a political and economic earthquake.
This bombshell ruling goes beyond mere technical legal interpretation; it directly challenges how the Executive Branch conducts trade policy, opening a Pandora's box of chain reactions. The tariffs, which Trump used as a tool of leverage and negotiation, have collapsed overnight, creating a strategic vacuum and billions of dollars in uncertainty.
On Friday, February 20, the Supreme Court ruled that President Trump overstepped his bounds by imposing sweeping tariffs under a law intended for national emergencies. The justices ruled 6-3 that the aggressive approach to duties on products entering the United States from around the world is not permitted under the 1977 International Emergency Economic Powers Act (IEEPA).
The opinion was authored by Chief Justice John Roberts, joined by three liberal justices and two conservatives, Justices Neil Gorsuch and Amy Coney Barrett. "The President invokes the extraordinary power to unilaterally impose tariffs of unlimited height, duration, and scope," Roberts wrote. However, the Trump administration "cites no statute" in which Congress previously stated that the language of the IEEPA could be applied to tariffs. Consequently, "we conclude that the IEEPA does not authorize the President to impose tariffs," Roberts concluded.
Dissenting voices
Justices Clarence Thomas, Brett Kavanaugh, and Samuel Alito issued a dissent. This represents a rare defeat for the administration in a court that maintains a 6-3 conservative majority since Trump began his second term in January.
The ruling does not affect all of Trump's tariffs; for example, those imposed on steel and aluminum under different statutes remain in effect. However, it overturns two major categories:
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Reciprocal Tariffs: These ranged from 34% for China to a base rate of 10% for the rest of the world.
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Fentanyl Enforcement Tariffs: A 25% duty on certain goods from Canada, China, and Mexico due to their alleged failure to curb drug flows. Trump may still seek to reinstate these duties using alternative legal frameworks.
Legal earthquake
The Supreme Court's challenge to the legality of the Donald Trump tariffs has triggered a legal earthquake with incalculable economic and geopolitical consequences. At stake is not just the $175 billion already collected, but trillions in budgeted revenue and the very architecture of US trade policy.
Donald Trump had turned tariffs—taxes on imported goods—into a central weapon of economic and foreign policy. Upon entering his second term, he launched a global trade war that unsettled allies and rivals alike, alienated trading partners, and sowed uncertainty in the global economy. These tariffs were the backbone of a "strategic economic sovereignty" plan.
Projections suggested trillions in revenue over the next decade for the United States, the world’s largest economy. However, since December 14, the Trump administration has not released official data on tariff revenues. According to Penn-Wharton economists, IEEPA-based revenue has already exceeded $175 billion. If this must be returned, it represents a fiscal shock with massive repercussions.
The US Constitution explicitly grants Congress—not the President—the power to impose taxes and duties. Trump utilized the IEEPA, which allows the President to regulate commerce during a national emergency, to bypass Congress. He was the first president to use the law in such an aggressive manner, stretching the limits of executive power.
Tariff refunds?
The Court's decision does not specify what will happen to the billions already collected under the now-voided IEEPA framework, leaving the door open for a wave of refund lawsuits. Hundreds of cases are currently pending in the US Court of International Trade.
While the majority opinion strikes down Trump's use of the IEEPA, it provides no guidance on restitution or whether importers are entitled to recover duties paid under measures now deemed illegal. This shifts the battle to lower courts, where importers will seek retroactive relief. In his dissent, Justice Kavanaugh noted that the process is likely to devolve into "chaos," warning of "serious practical consequences" regarding refunds.
Such claims could raise complex issues of sovereign immunity and the exhaustion of administrative remedies, particularly where duties were paid without timely protest. During oral arguments on November 5, the court appeared skeptical of Trump's authority, leading observers and betting markets to predict this outcome. The Trump administration had appealed lower court rulings that found it had exceeded its powers, with Trump himself calling a defeat a "terrible blow" to the United States.
Other options
Despite this setback, the Trump administration possesses several other legal avenues. As Deutsche Bank noted last month, sectoral tariffs (e.g., steel and aluminum) are unaffected. Another option is Section 122 of the Trade Act of 1974, which allows for temporary 15% tariffs for 150 days to address balance-of-payment deficits.
Goldman Sachs commented: "This will not be the end of tariffs... the administration will almost certainly push alternative legal frameworks. The net result will likely be slightly fewer tariffs, substantially greater trade uncertainty, and additional deficit concerns." Meanwhile, Trump called the decision a "disgrace" and told governors during a White House breakfast that he has an "alternative plan," though he provided no details.
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