On May 7, 2026, the U.S. Court of International Trade (CIT) ruled that the Trump administration’s 10% temporary global tariff imposed under Section 122 of the Trade Act of 1974 is unlawful. The court held that the statutory conditions required to invoke Section 122 were not satisfied and that the tariffs were therefore unauthorized by law.

The Section 122 tariffs were imposed by the administration on February 20, 2026, after tariffs previously imposed by President Donald Trump, pursuant to his alleged authority to impose duties under the International Emergency Economic Powers Act (IEEPA), were struck down, as we outlined in prior client alerts. The Section 122 tariffs were a substitute measure to be used as a temporary buffer while Section 301 investigations that could support the imposition of more permanent tariffs are conducted. The Section 122 tariffs may stay in place for 150 days, unless extended by congressional action, and were set to expire on July 24, 2026.

This decision provides only limited and, perhaps temporary, relief. Unlike the CIT’s order regarding IEEPA tariff refunds, the court did not issue a nationwide injunction. Relief in the form of tariffs previously paid and interest thereon applies only to the specific plaintiffs before the court. The Section 122 tariffs remain in effect for other importers while the appeals process unfolds. To date, the government has appealed the decision to the U.S. Court of Appeals for the Federal Circuit. In addition, on May 11, 2026, the Trump administration asked CIT to pause its ruling pending appeal; if a stay is granted, the tariffs would resume for the three importers who brought the lawsuit.

Regardless of any government appeal, key tariff payment deadlines continue to run, including liquidation and payment timing and the statutes of limitation for protests and court challenges. Those deadlines are not suspended by this decision because it’s not a universal injunction. It’s uncertain if the tariffs will be ultimately invalidated on a broader basis and resolution could take years, potentially delaying refunds and increasing procedural complexity. If relief is not granted on a universal basis, such delays could create uncertainty for individual claims, including leaving some claims subject to differing outcomes. This is particularly true for statutory deadlines lapses, potentially affecting the availability and amount of refunds available for later claims for relief.

For these reasons, importers may wish to consider filing a "protective" action at the CIT to preserve potential refund rights, as many did during the early stages of the IEEPA tariff disputes. While the IEEPA experience suggests refunds may ultimately be achievable, relying on future administrative mechanisms entails real risk. Taking early legal action may help avoid uncertainty and protect refund claims should broader relief be granted later.

We will continue to monitor developments closely, including any appeal, changes to tariff administration, or refund guidance. Importers should consider partnering with outside counsel to discuss strategic options tailored to their individual exposure.

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