CIT presses CBP on the IEEPA refund gap: CAPE Phase 2 and the final-liquidation problem
Primary lensEntry posture review
Sub-topicFinally-liquidated entries
Evidence base4 records used
Use caseRefund posture
The status conferences are doing the work the orders cannot do alone
The IEEPA refund architecture has moved quickly since the Supreme Court decided Learning Resources, Inc. v. Trump on February 20, 2026, holding that IEEPA does not authorize the President to impose tariffs. The Court of International Trade has issued an initial refund order, amended it, transferred the lead case, watched CBP stand up a refund portal, and pulled the parties back into chambers roughly every two weeks since. The most consequential moments have been the closed status conferences before Judge Richard Eaton, and the orders he has been issuing afterward are starting to narrow the population of importers whose refunds remain blocked by procedural posture rather than by the merits.
The next inflection is whether the court forces CAPE Phase 2 (the phase that reaches finally-liquidated entries) to ship on a court-mandated timeline rather than on CBP's own.
The operative framework, in three orders
The current refund framework traces to three orders from Judge Eaton.
On March 4, 2026, Eaton issued the initial Refund Order in Atmus Filtration, Inc. v. United States at the U.S. Court of International Trade, directing CBP to liquidate unliquidated entries without IEEPA duties and to reliquidate liquidated entries that were not yet final. The court framed the relief as running to "all importers of record" that paid IEEPA-based duties (Greenberg Traurig analysis), not only the named plaintiffs.
On March 27, 2026, Eaton issued an amended order expanding the directive to cover finally-liquidated entries at least as a directional matter, though the operational mechanics for that population were left to be worked out.
On April 7, 2026, after Atmus Filtration voluntarily dismissed its case, the CIT sua sponte lifted the stay on Euro-Notions Florida, Inc. v. CBP, No. 25-00595 and issued a parallel order in that case. Euro-Notions is the live vehicle now, and the remaining roughly 2,500 individual IEEPA tariff cases at the CIT remain subject to the automatic stay under Administrative Order 25-02.
Phase 1 excludes Type 09 reconciliation entries and Type 47 drawback entries, and limits each declaration to 9,999 entries. CBP's stated processing target is a refund within 60 to 90 days of declaration acceptance unless a compliance review intervenes.
The volumes are large. CBP's declaration to the CIT on May 11, 2026 reported 126,237 CAPE declarations submitted since launch, 15,123,221 individual entries accepted for IEEPA-duty removal, 8,338,081 entries already liquidated or reliquidated without IEEPA duties, and an anticipated refund and interest amount of approximately $35.46 billion on the reliquidated set.
The gap the court keeps returning to
What Phase 1 does not touch is the finally-liquidated population, the entries that liquidated more than 80 days before a CAPE filing and that have no live protest open under 19 U.S.C. Section 1514, which gives importers 180 days from liquidation to file. Those entries sit outside the portal.
Eaton has flagged this gap directly. As of April 1, 2026, the court observed that "no resolution has been reached with respect to the reliquidation, by way of CAPE, of entries for which liquidation has become final." CBP has signaled that a future "Phase 2" will address that population, but no firm timeline has been published. Current industry expectation is a Q3 2026 rollout.
That gap is doing two kinds of damage.
First, it shifts cost. Importers whose entries fell outside the Phase 1 window are being advised to file individual CIT actions to preserve a refund path, which means paying counsel for what looks more like administrative work. The roughly 2,500 individual cases already on the CIT docket reflect that incentive.
Second, and this is the population the court keeps returning to in successive status conferences, the gap disproportionately strands informal entries. Many shipments that previously qualified for the Section 321 de minimis exemption became dutiable informal entries after Executive Order 14324 suspended duty-free de minimis treatment for all countries, effective in September 2025. Informal entries liquidate at or near the date of entry, which means the 180-day Section 1514 protest window had already run out for a substantial portion of the affected universe by the time Learning Resources came down. Without administrative relief, that population has no realistic path back to its money short of litigation that is uneconomic on a per-entry basis.
What the next status conference is likely to do
A further closed status conference was scheduled for May 12, 2026, with Eaton having previously instructed the government to appear prepared to discuss how liquidated entries might be handled. The trajectory of the orders, combined with the volume of finally-liquidated entries the court keeps flagging, points toward one of three outcomes.
A court-ordered Phase 2 deadline. The court has leverage to convert CBP's open-ended "future phase" into a date-certain rollout. That would be the cleanest fix for the informal entry problem because it would push the work back into ACE rather than into the protest queue.
A class-style or universe-defined operational order. The court could order CBP to identify finally-liquidated IEEPA-coded entries from its own data and refund them without requiring importer initiation. Several recent orders read as building the predicate for that move.
A narrower administrative carveout for informal entries specifically. This is the most surgical option and the most consistent with the court's stated focus, but it would leave finally-liquidated formal entries on the litigation track.
The choice matters operationally because it determines who has to do the work, either CBP at the system level or the importer at the entry level.
What changes for refund strategy
Until the court actually issues a Phase 2 order, the operating guidance from the May 27 IEEPA refund architecture brief still holds. File protests inside the 180-day window where you can, queue CAPE submissions for entries CBP can reliquidate today, and preserve litigation positions where the entry value justifies the cost.
What is changing is the planning horizon. Counsel and brokers should now build the refund file on the working assumption that a Phase 2 mechanism is more likely than not by Q3 2026, even if the specific form is unsettled. The gating activity is documentation discipline at the entry level, which means importer of record reconciliation, IEEPA-rate breakouts on the entry summary, and clean records of any Chapter 99 lines paid. Any operational order the CIT issues will still require the importer to substantiate the claim once the portal opens.
The signal worth watching is the next written order out of Eaton's chambers. If the order names a Phase 2 mechanism, even tentatively, the working assumption that finally-liquidated entries require individual litigation is gone.
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