Politics

Will Trump’s Tariffs Face a Billions-Dollar Backlash? Supreme Court Case Sparks Refund Frenzy

Supreme Court heard tariff case; justices skeptical. Refunds could be in the billions; firms are buying claims.

November 6, 2025, 11:09 AM

Wooden judge's gavel next to stacks of banded $100 bills, symbolizing legal finance.

A gavel rests next to stacks of US $100 bills, symbolizing the billions-dollar tariffs case. By Victor Moussa / Shutterstock.com.

Executive Summary

The Supreme Court heard oral arguments on a landmark tariff case challenging the Trump administration’s levies, with several justices expressing skepticism and potentially paving the way for tens of billions in business refunds.

A significant point of contention is the uncertain and complex mechanism for tariff refunds, should the court rule against the administration, with nearly $90 billion collected from the tariffs under review.

Investment banks are actively approaching importers to purchase their potential tariff refund stakes at a discount, allowing businesses to de-risk the outcome for immediate cash.

The Story So Far

The Supreme Court is currently reviewing the legality of tariffs imposed by the Trump administration, which have accumulated nearly $90 billion from businesses, creating a landmark case with potentially massive financial implications. This legal challenge, which has drawn skepticism from several justices, could result in tens of billions of dollars in refunds to businesses, leading to complex reimbursement processes and attracting investment banks to purchase potential claims at a discount.

Why This Matters

Should the Supreme Court rule against the Trump administration’s tariffs, businesses could be eligible for tens of billions of dollars in refunds, though the reimbursement process is expected to be highly complex and potentially messy, requiring intricate navigation of legal and administrative procedures. This financial uncertainty has prompted investment banks to actively buy potential refund claims at a discount, offering immediate cash but also creating a dynamic where some businesses experience “seller’s remorse” while others hold out for a full potential payout.

Who Thinks What?

Several conservative and liberal Supreme Court justices expressed deep skepticism regarding the Trump administration’s legal position to maintain the tariffs and raised questions about the complexity of a potential reimbursement process.

Businesses challenging the tariffs, represented by Neal Katyal, believe their clients would be entitled to refunds if the court rules against the administration, though they acknowledge the process for others would be “very complicated”; some importers who sold their potential refund claims are experiencing “seller’s remorse” after oral arguments, while others who held onto their stakes feel “more cautiously optimistic.”

Investment banks like Oppenheimer and Jefferies are actively approaching importers to purchase their potential tariff refund stakes at a discount for immediate cash, allowing businesses to de-risk the outcome and receive guaranteed payment without waiting for court decisions.

The Supreme Court heard oral arguments on Wednesday in a landmark tariff case challenging the Trump administration’s levies, potentially paving the way for tens of billions of dollars in refunds to businesses. Several conservative and liberal justices expressed deep skepticism regarding the administration’s legal position to maintain the tariffs, raising questions about the complexity of a potential reimbursement process.

Uncertainty Over Refund Eligibility

A significant point of contention during the arguments was the mechanism and eligibility for tariff refunds should the court rule against the Trump administration. Justice Amy Coney Barrett pressed Neal Katyal, representing the challenging businesses, on how the reimbursement process would function, describing it as a potential “mess.”

Katyal acknowledged the complexity, stating that while his five client businesses would be entitled to refunds, the process for others would be “very complicated.” Trade attorney Thomas Beline suggested that businesses outside the direct legal challenge might need to file separate appeals with lower courts to seek refunds.

The Reimbursement Process

The federal government has collected nearly $90 billion from the tariffs currently under review. Beline advises importers to request liquidation extensions or file protests with U.S. Customs and Border Protection (CBP) to prevent entries from fully settling, which could facilitate future refunds.

While a 1998 Supreme Court decision on harbor maintenance fees resulted in $730 million in refunds over two years, the current case involves a substantially larger sum. Ashley Akers, senior counsel at Holland & Knight and a former Justice Department trial lawyer, indicated that CBP might implement a streamlined process for refunds, though automatic blanket refunds are unlikely. Any refunds received could also include statutory interest.

Wall Street’s Involvement

In anticipation of a potential ruling, investment banks like Oppenheimer and Jefferies have actively approached importers to purchase their potential tariff refund stakes at a discount for immediate cash. This allows businesses to de-risk the outcome and receive guaranteed payment without waiting for court decisions.

Marketing materials from Oppenheimer in July suggested a “market rate” of 20% to 30% of the payments made for these tariffs. Kyle Peacock of Peacock Tariff Consulting noted aggressive tactics from these firms, particularly targeting “credit-stretched” importers, with some accepting offers as low as 5% to 7% of a potential refund.

Industry Reaction and Outlook

Peacock observed a “scare mentality” being employed by firms buying refund claims, often suggesting businesses would receive nothing otherwise. Following Wednesday’s oral arguments, many of his clients who sold their claims are experiencing “seller’s remorse,” while those who held onto their stakes feel “more cautiously optimistic.”

The Supreme Court’s decision, expected in the coming months, will determine the fate of billions in tariff revenue and set a precedent for how businesses navigate complex trade policies and potential reimbursements.