A divided panel of the U.S. Court of International Trade (CIT) issued a decision in the combined cases of The State of Oregon v. United States and Burlap and Barrel, Inc. v. United States, on May 7, 2026, holding that President Trump’s recently imposed 10 percent global tariffs under Section 122 of the Trade Act of 1974 (the “Section 122 tariffs”) were unlawful.

The ruling represents another significant judicial check on the Trump Administration’s tariff authority but leaves considerable uncertainty as to next steps. For one, the Trump Administration is already in the process of appealing and will likely ask for a stay of the order in the interim. But more important for the trade community is the fact that the CIT’s ruling only applies to certain parties that filed the cases; the court did not order U.S. Customs and Border Protection (CBP) to stop collecting those tariffs broadly.

Background on Section 122 Tariffs

President Trump imposed the Section 122 Tariffs under a proclamation on February 20, 2026, the same day that the Supreme Court invalidated (and President Trump ended) his prior tariffs under the International Emergency Economic Powers Act (IEEPA). Through Section 122 tariffs, Congress delegated specific tariff authority to the President for a limited duration (150 days unless Congress extends them) to address international payment problems such as balance-of-payments deficits.

The President used the authority to impose a global 10 percent tariff on all imports, with listed exceptions based on “the needs of the United States economy.” The tariffs are set to expire on July 24, 2026.

The U.S. Court of International Trade Ruling

The CIT concluded that the Trump Administration lacked the authority to impose the Section 122 tariffs, because the trade deficits cited in the proclamation did not meet the definition of balance-of-payments deficits required to impose the tariffs. The CIT therefore held that the proclamation is invalid, and “the tariffs imposed on Plaintiffs are unauthorized by law.”

Despite the broad language of the holding, the relief—an injunction preventing application of the tariffs—is not universal and does not apply to all importers. Only the plaintiffs that the court found had standing to bring the claims benefited from the ruling.

More Waiting Games for Importers

Given that the court declined to issue a nationwide injunction, many importers are likely wondering whether to file actions in the CIT. There is no one-size-fits-all approach, and each business should consult legal counsel in deciding the best course of action, but patience is likely still in importers’ best interests.

The Trump Administration has unequivocally stated that they will appeal this decision, and, while the case is on appeal, they will seek and likely obtain a stay of the ruling. This would keep the Section 122 tariffs at status quo, with CBP still collecting the tariffs while the import world waits on the appeal process to (or through) the U.S. Court of Appeals for the Federal Circuit.

Section 122: Always a Stop Gap Measure

The Section 122 tariffs are thought to be only a temporary backstop following the Supreme Court’s ruling on the IEEPA-based tariffs, while the Trump Administration continues to pursue more durable tariff measures. The U.S. Trade Representative has launched an investigation and regulatory process under Section 301 of the Trade Act of 1974. Tariffs that result from that process have historically proven more durable and defensible in court.

What This Means for Companies

For now, companies should continue to monitor developments closely but should not expect immediate, across the board relief from these tariffs. Businesses impacted by current or potential future tariffs should consider the following measures:

1. Know your deadlines and data. Inventory your entries to ensure you know entry dates, liquidation dates, and protest deadlines for all entries on which Section 122 tariffs were assessed, and start compiling your data for potential refund requests if they become available, as they are with the IEEPA-based tariffs.
2. File protests. Under ordinary CBP procedures, importers must file protests to preserve their rights within the 180-day time period following liquidation, and this course of action is still recommended, given the uncertainty.
3. Review agreements and terms and conditions. Importers may be contractually required to refund purchasers that paid higher prices to cover tariffs. 
4. Litigation? Whether litigation would be the right solution for your business should be considered carefully, though the majority of businesses should exercise patience while the trade community waits on the next court decisions.
5. Coordinate with the Ice Miller International Trade team. The Ice Miller team is monitoring this situation closely and can help you determine your best course of action.

How Ice Miller Can Help

As businesses navigate these uncertain and rapidly changing times, the Ice Miller team stands ready to assist and provide guidance on these and other issues. Please contact Meghann Supino, Michael Stroud, Dale Stackhouse, Joe Heaton, Grace Dahm, or Emily Bullen if you believe we can help.

Resources

• Prior Ice Miller publication, Refund Portal to Open for Phase 1 Refund Requests Monday, April 20
• Prior Ice Miller publication, The New Tariff Landscape in the Wake of the Supreme Court’s Learning Resources Decision Takes Shape
• Prior Ice Miller publication, Court Directs Customs to Issue Refunds of a Majority of the IEEPA-Based Tariffs
• Prior Ice Miller publication, Supreme Court Showdown Results Are In: Emergency Tariffs Rejected
• Prior Ice Miller publication, Court of International Trade Issues Surprise Ruling on Trump Tariffs: What You Need to Know
• Prior Ice Miller publication, Historic Rulings on Tariffs Set Stage for Potential Supreme Court Showdown

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.