Alcohol Beverage Importers Continue to Navigate Uncertainty Despite Supreme Court Decision on IEEPA Tariffs
POSTED BY Bahaneh Hobel, John Trinidad, Theresa Barton Cray, and Tracy Genesen
On February 20, 2026, in a victory for American beer, wine, and spirits importers, the Supreme Court in Learning Resources, Inc. v. Trump, 607 US ____, Slip Op., February 20, 2026 (“Learning Resources”) struck down President Trump’s imposition of tariffs under the International Emergency Economic Powers Act (“IEEPA”). The Trump administration had used IEEPA to justify certain tariffs imposed on imported goods from various countries in 2025, including beer, wine and spirits.
Despite the decision in the importers’ favor, no one is popping the Champagne quite yet. First, while the Court’s opinion invalidated the Trump administration’s IEEPA tariffs, it has no effect on the administrations’ ability to rely on other statutes to impose tariffs. Second, on the same day that the Supreme Court issued its decision, the President issued a proclamation imposing a 10% worldwide tariff under a different federal law (discussed in more detail below). This new tariff is set to go into effect for a 150-day period starting at 12:01am EST on Tuesday, February 24. Then, over the weekend, the President announced on social media that this new tariff was being increased to 15%, though as of this writing, no new official proclamation has been issued. Finally, there is significant uncertainty regarding how and when importers will be refunded for tariff payments previously paid on these unconstitutional IEEPA tariffs. Indeed, administration officials have signaled that they will wait for a court order before they specify a tariff refund process.
In short, alcohol beverage importers will continue to have the unenviable task of navigating their business through tariff and trade uncertainty for the foreseeable future. We have included guidance from the National Association of Beverage Importers below on potential next steps, but ultimately, importers should seek advice from experienced trade counsel on these fast-moving issues.
Case Background
As background, IEEPA grants the President the authority “to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States, if the president declares a national emergency with respect to such threat.” IEEPA expressly grants the President the right to “regulate…importation or exportation of…any property in which any foreign country or a national thereof has any interest...”
Shortly after taking office, President Trump declared a national emergency with respect to two stated foreign threats: (i) drug trafficking into the United States at the northern and southern United States borders, specifically the influx of illegal drugs from Canada; and (ii) “large and persistent” trade deficits with other countries, which the President argued undermined American manufacturing. The President subsequently imposed a 10% tariff on nearly every county in the world, and higher tariffs on key U.S. trading partners including Canada, Mexico, China, the European Union, Japan and South Korea, citing his right to regulate importation under IEEPA.
The IEEPA tariffs disrupted and burdened the already struggling beverage alcohol industry by creating widespread uncertainty amongst importers, affecting cross-border sales, and eventually driving up prices for imported products.
Learning Resources and Hand2mind, two family-owned educational toy companies, filed suit in the U.S. District Court for the District of Columbia challenging the constitutionality of the IEEPA tariffs and arguing that the statute did not authorize the President to impose tariffs. In a separate action, V.O.S. Selections, a New York based wine and spirits importers, and four other small businesses filed suit in the U.S. Court of International Trade (“CIT”) raising similar arguments to those made by plaintiffs in the Learning Resources case. The plaintiffs in both cases prevailed. In Learning Resources, the administration filed an appeal with the D.C. Circuit Court of Appeals, and plaintiffs quickly filed a petition for certiorari before judgment, and the Supreme Court granted the petition. In VOS Selections, the Federal Circuit Court of Appeals affirmed the CIT decision in favor of the plaintiffs and the government filed a writ of certiorari to appeal the decision to the Supreme Court. The Supreme Court consolidated the appeals in both cases and heard oral argument on November 5, 2025.
In the consolidated Learning Resources decision, the Supreme Court held that the IEEPA does not grant the President the authority to impose tariffs. The majority first acknowledged that the power to impose tariffs is a taxing power delegated to Congress under Article I of the Constitution and therefore has “unique importance.” As the Court stated, because these taxing powers are typically reserved to Congress, “[w]hen Congress grants the power to impose tariffs, it does so clearly and with careful constraints.” See Learning Resources, Slip Op. at 17. Although IEEPA grants the President the power to “regulate” importation, the Court held that “regulate” under IEEPA does not include the power to impose taxes or tariffs because Congress did not provide clear congressional authorization granting the President the specific right to impose taxes or tariffs in IEEPA. See Learning Resources, Slip Op. at 15-17. In making these statements, the Court made clear that tariffs imposed on imported goods are a form of taxation on United States importers, and absent clear congressional direction otherwise, this is a power reserved to Congress. See Learning Resources, Slip Op. at 17.
Non-IEEPA Tariffs and New Tariff Announcements
Although the Court’s decision invalidated the Trump administration’s IEEPA tariffs, importers are unfortunately not yet out of the woods with respect to global tariffs. The Court’s decision in Learning Resources focused specifically on IEEPA tariffs, leaving the dispute between the United States and Canada with respect to tariffs imposed under Section 232 of the Trade Expansion Act of 1962 largely undecided.
Additionally, the Trump administration has made clear it will continue its tariff strategy by relying on alternative statutory support. In fact, as noted above, shortly after the issuance of the Court’s opinion on Friday, President Trump signed a Proclamation (“Imposing a Temporary Import Surcharge to Address Fundamental International Payments Problems”) imposing a temporary 10% global “surcharge” under Section 122 of the Trade Act of 1974. This provision allows a president to impose an “import surcharge” of up to 15% for up to 150 days (absent Congressional approval for extension) to address problems caused by “fundamental international payments problems” or “serious United States balance-of-payments deficits.” The next day, the President declared in a social media post that the new tariff would go up to 15% effective immediately, but no new proclamation or more official action has taken place as of the publication of this post. It is possible that importers will also challenge Section 122’s applicability and whether its requirement for a “balance-of-payments problems” is met by virtue of the deficits with other countries but that remains to be seen.
For good measure, the administration is laying the groundwork for tariffs under Section 301 of the Trade Act of 1974. That provision grants the U.S. Trade Representative (“USTR”) the ability to impose tariffs if an investigation determines that “the rights of the United States under any trade agreement are being denied” or “an act, policy, or practice of a foreign country…is unjustifiable and burdens or restricts United States commerce.” The USTR announced that it is initiating “several” such investigations “to deal with unjustifiable, unreasonable, discriminatory, and burdensome acts, policies, and practices by many trading partners.”
Uncertainty Regarding Tariff Refund Process and Timing
While the Supreme Court ruled that the IEEPA tariffs were unconstitutional, it did not provide any guidance on the process by which refunds should be issued. In his dissent, Justice Kavanaugh predicted consequential refund chaos, writing: “The United States may be required to refund billions of dollars to importers who paid the IEEPA tariffs, even though some importers may have already passed on costs to consumers or others. As was acknowledged at oral argument, the refund process is likely to be a ‘mess.’”
Now that the Supreme Court has weighed in, one would think that importers are entitled to a refund for payments made in response to the unconstitutional IEEPA tariffs. Indeed, the government has on multiple occasions in front of multiple courts, expressly stated that importers would have a right to refunds should the tariffs be deemed unconstitutional. For example, in opposing plaintiffs’ motion for a preliminary injunction in the Learning Resources case before the District Court, the government stated, “[E]ven if a stay is entered and defendants do not prevail on appeal, plaintiffs will assuredly receive payment on their refund with interest.” Learning Resources, Inc. v. Trump, No. 25-cv-01248 (D.D.C. filed Apr. 22, 2025), June 2, 2025, ECF No. 41. The CIT included a laundry list of similar government statements in footnote 1 of this decision. Accordingly, in any court action, the government would appear to be judicially estopped from arguing that importers are not entitled to refunds.
The executive branch, however, appears unwilling to make the road to refunds efficient or easy for U.S. importers. During an interview on Sunday, Treasury Secretary Scott Bessent claimed that the Supreme Court had remanded the question of refunds to the lower court. On the same day, U.S. Trade Representative Jamieson Greer stated the Court of International Trade will “have to step in and give some direction on how they want [tariff refunds] to be done.” And President Trump himself signaled that the process of tariff refunds could take years of litigation. Indeed, in an election year, the issue of tariff refunds may become a political football. Congressional Democrats are pressing the administration to provide a detailed explanation of how it will process tariff refunds, and administration officials have stated that refunds would constitute a “corporate boondoggle” for importers that have raised prices on down-stream purchasers (including consumers).
There are several moving pieces, and it is unclear whether importers will simply be able to rely on an administrative process to seek refunds, or whether they will have to file suit before the CIT in order to do so. Earlier today, the National Association of Beverage Importers (NABI) provided members with the following input regarding refunds (reprinted here with permission from NABI):
Refunds were not addressed by the Supreme Court’s majority, but when a tax is found unconstitutional, the money collected under that tax is refundable, unless the court expressly limits its holding to the parties. The court did not do that, so under ‘normal’ circumstances importers are entitled to refunds (plus interest). That is not to say that refunds will be automatic—they are not. The president hinted during his Friday press conference that refunds would need to be sought through litigation, though there is similarly nothing that indicates litigation is required across the board.
The standard refund process is either a post summary correction (PSC) for those entries which have not liquidated, and will not liquidate for at least 15 days. The standard refund process for entries which have liquidated is to file a protest.
There are unknowns with either route, and no guarantees for approval, but the costs of filing either a protest or a PSC are relatively low and would serve as the starting point for potential future litigation, should importers seek to file claims with the CIT. At this time, however, importers should be considering internally, and/or with counsel, whether they should submit through the standard Customs process to preserve their rights to a refund. Most tariffs paid on alcoholic beverages should not yet be liquidated so many entries should be ‘refundable’ via PSC.
DP&F will continue to monitor both the IEEPA refund question and the Trump Administration’s pursuit of alternative statutory authorities in support of a new tariff agenda and will publish updates as this matter evolves.
For further questions regarding IEEPA tariffs and potential refunds, or other alcohol beverage matters, please reach out to DP&F’s Alcohol Beverage Law and Compliance team.
Thank you to Andrea Nappi Conforme, President of the National Association of Beverage Importers (NABI) for assistance in reviewing this blog post with our DP&F Alcohol Beverage Law and Compliance team and in allowing us to incorporate information they previously sent to NABI members. NABI is a national trade association representing U.S. importers of beer, wine and distilled spirits. For more information about NABI or membership inquiries, please contact NABIpresident@bevimporters.org.
