Since our July 17 update on the IEEPA refund process, the Court of International Trade (CIT) has provided its clearest indication yet of how it intends to handle finally liquidated entries during CAPE Phase 3. The court has outlined the framework it plans to use, designated a new lead case, and signaled that class certification could soon become a central issue. Here’s what importers need to know.
CIT Sets the Stage for Phase 3 Reliquidations
On July 15, 2026, the CIT issued an order outlining the next phase of the IEEPA refund litigation. Rather than issuing one blanket ruling, the court stated that it will enter case-specific reliquidation orders in each of the approximately 3,700 individual IEEPA cases currently pending before it. Those orders will follow procedures the court says it will describe in a forthcoming order.
This is the clearest indication yet of how the court intends to address finally liquidated entries during CAPE Phase 3. While the July 15 order does not automatically extend refunds to importers who never filed suit, it establishes the framework the court intends to use while broader legal questions remain on appeal.
New Lead Case: Freestyle World Inc. v. United States
The court also named a new lead case for the finally liquidated entry issue. Freestyle World Inc. v. United Statesreplaces Euro-Notions Florida, Inc., which is voluntarily dismissing its claim.
As the new lead case, Freestyle World will now shape how the court addresses importers whose entries became final before CBP’s refund process was established. Companies following the litigation should now look to Freestyle World for future developments rather than Euro-Notions.
Class Certification Could Become the Next Major Development
Freestyle World, like lead plaintiff V.O.S. Selections, has a pending motion for Rule 23 class certification. If the court certifies a class, it could provide a mechanism for extending refunds to similarly situated importers without requiring every company to file its own lawsuit.
That question remains unresolved, however. The federal government continues to argue before the U.S. Court of Appeals for the Federal Circuit that CBP lacks authority to reliquidate finally liquidated entries or issue refunds without a specific court order for each importer. The July 15 order does not resolve that dispute, but it demonstrates that the CIT is actively moving forward with a process while the appeal continues.
CAPE Refund Totals Continue to Grow
The litigation was not the only development this week. During the court’s July 14 status conference, CBP reported continued progress under the CAPE refund program.
According to CBP, approximately $121.75 billion in potential and certified refunds have now been accepted into CAPE processing, while roughly $86.3 billion has been certified and transmitted to the U.S. Treasury for payment. CBP also reported that 9,837 approved refunds remain on hold because importers have not provided ACH payment information, underscoring the importance of ensuring refund enrollment information is current.
What Hasn’t Changed
The overall framework for IEEPA refunds remains the same.
- Unliquidated and not-yet-final entries continue moving through CAPE and are generally unaffected by the appeal.
- Finally liquidated entries covered by active CIT litigation currently appear to have the clearest path toward refunds through the court’s developing Phase 3 process.
- Finally liquidated entries without a pending lawsuit remain the group facing the greatest uncertainty. While the July 15 order and potential class certification represent encouraging developments, neither guarantees refunds for companies that did not file suit.
The two-year statute of limitations for IEEPA refund claims also continues to run.
What to Watch Next
The next several weeks could bring additional clarity.
- CBP’s next CAPE progress report is expected on August 4.
- A closed settlement conference is scheduled for August 5.
- The court is expected to provide additional guidance on its Phase 3 reliquidation procedures as the litigation progresses.
Action Items for Importers
Companies with finally liquidated entries should continue monitoring developments closely.
- Review whether your entries are covered by existing litigation.
- Monitor the Freestyle World case and any developments regarding Rule 23 class certification.
- Evaluate with counsel whether filing a protective action remains appropriate rather than relying on a potential future class.
- Confirm your ACE and ACH refund enrollment information is current so approved refunds are not delayed.
- Continue watching CBP’s CAPE progress reports for updated refund totals and Phase 3 implementation details.
ASK ALBA™: Not sure whether your finally liquidated entries are better served by filing individually or waiting on the class certification process? Contact our trade compliance team.
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