After HMTX, Lists 3 and 4A are permanent and IEEPA is the refund line
The Supreme Court's June 15 cert denial in HMTX leaves the Federal Circuit's Section 301 ruling as controlling authority. List 3 and 4A duties are durable, IEEPA is the refund line through CAPE, and the next fight is whether USTR can rebuild the tariff wall under Sections 301 and 307 without recreating IEEPA's legal defect.
Written byTRAVERSE Research
Primary lensEntry posture review
Evidence base10 records used
Use caseSaved scope review
Throughout, Section 307 means Trade Act Section 307, 19 U.S.C. 2417, the authority to modify a Section 301 action. It does not mean the forced-labor import ban at 19 U.S.C. 1307. The distinction matters because the next Section 301 fight is itself a forced-labor case, and confusing the two distorts both the legal posture and the refund analysis.
The Supreme Court's June 15, 2026 denial of certiorari in HMTX Industries v. United States sets no Supreme Court precedent, but it leaves the intact. For litigation over Lists 3 and 4A at the Court of International Trade and the Federal Circuit, that decision is now the controlling authority absent en banc reversal, later Supreme Court intervention in another case, or a change in the statute. Importers subject to Lists 3 and 4A should treat those duties as durable and unwind any position that depends on recovering them.
Three developments now set entry posture. HMTX has fixed Lists 3 and 4A as durable Section 301 duties, the February IEEPA decision opened the refund line, and the new Section 301 investigations are where the next fight sits.
Where the cert denial leaves Lists 3 and 4A
The denial appeared in the weekly order list on June 15, 2026, with no explanation and no noted dissents, the Court's standard practice when it declines a case. A denial sets no Supreme Court precedent and resolves nothing on the merits at the highest level. It leaves the Federal Circuit's precedential opinion in HMTX Industries, LLC v. United States in force. Because this type of Section 301 challenge proceeds through the Court of International Trade and then the Federal Circuit, that opinion controls these tariffs absent a future en banc reversal, a later cert grant in a different case, or a change in the statute.
That finality reaches a large cohort. Per the cert petition, more than 4,200 additional actions raised substantively similar claims, with HMTX selected as the sample case. The cohort began in September 2020 with roughly 3,500 lawsuits brought by more than 6,000 importers at the Court of International Trade. It now has no surviving common merits theory on whether the modification exceeded USTR's authority.
The litigation history shows why the theory is closed, not merely paused. A three-judge panel at the Court of International Trade issued its first opinion on April 1, 2022. It rejected the government's argument that the tariffs were non-justiciable presidential action or a political question, held that USTR had statutory authority to impose Lists 3 and 4A, but found that USTR had violated the Administrative Procedure Act by failing to adequately respond to significant public comments, and it remanded for further explanation without vacatur. On remand USTR produced a fuller explanation, and the court's second opinion, on March 17, 2023, held that the redetermination cured the defect and sustained the tariffs.
The Federal Circuit affirmed on September 25, 2025, but on different statutory ground. It declined to address the scope of USTR's authority under Section 307(a)(1)(B) and instead concluded that Section 307(a)(1)(C) independently authorized the Lists 3 and 4A actions. The court held that the tariffs were USTR action subject to review under the Administrative Procedure Act rather than unreviewable presidential action, that the word modify is indifferent to both the degree and the direction of change and so reaches major escalations as well as de-escalations, that nondelegation was satisfied because the provision supplies an intelligible principle, and that the remand elaboration met the Administrative Procedure Act's requirements. It distinguished the Solar Energy line on the ground that a separate phase-down requirement, not the word modify, had cabined the authority in that case.
Why HMTX and IEEPA came out differently
The Federal Circuit treated the IEEPA and Section 301 lines differently. In the V.O.S. Selections line, it rejected the IEEPA tariff theory. In HMTX, it upheld the List 3 and 4A Section 301 modifications because it viewed them as a new use inside an existing statutory tariff scheme rather than a transformation of tariff authority. It reasoned that the major-questions doctrine did not apply because the Lists 3 and 4A tariffs may, at best, be a new use of USTR's regulatory authority but do not transform that authority, in contrast to the unprecedented IEEPA tariffs. Clear congressional authorization in Sections 301 and 307 meant the doctrine was not triggered at all.
That transformation point is what divides the two lines. In the Supreme Court's IEEPA decision, the Court reasoned that reading IEEPA to permit tariffs would be a transformative expansion of executive authority over tariff policy, giving the President power to impose unbounded tariffs free of the procedural limits in other tariff statutes. Section 307, by contrast, was held to operate inside an existing and congressionally authorized scheme. That line is how to read which future tariff actions are vulnerable. An action that looks like a genuinely novel assertion of power is exposed. An action that looks like an incremental use of authority Congress already granted is durable.
The Section 307 loophole argument and why it failed
Section 307 lets USTR modify or terminate any action taken under Section 301, subject to the specific direction of the President if any, where the burden on United States commerce of the subject practices has increased or decreased, or where the action is no longer appropriate. It requires USTR to give interested persons affected by the proposed modification an opportunity to present their views. The initial Section 301 action, by contrast, requires the fuller sequence of investigation, determination within statutory deadlines, consultation with the target government, and comment periods.
The importers built their case on that asymmetry. They argued that Section 307 should allow only modest changes to the original action, and that the Federal Circuit's reading hands any administration a roadmap to bypass Section 301's safeguards by imposing modest tariffs under the full procedure and then expanding them massively under the streamlined one, without fresh consultation, committee advice, or new fact-findings. They framed this as a major-questions and nondelegation problem. The courts rejected the magnitude limit. The Federal Circuit held that the differing procedural requirements reflect the different inquiries under Sections 301 and 307 rather than a cap on how large a modification can be, that the authority to modify duties includes the authority to increase them, and that the operative boundary is that a modified action must stay tied to the original Section 301 action and tailored to eliminating the foreign practices that prompted it.
The IEEPA refund line and the finally-liquidated fight
The February 20, 2026 decision in Learning Resources, Inc. v. Trump, consolidated with the V.O.S. Selections matter, held six to three that IEEPA's authority to regulate importation does not include the power to impose tariffs, which is a branch of the taxing power reserved to Congress. Because the defect was the absence of statutory tariff authority rather than anything specific to particular countries, rates, or durations, it reached the IEEPA tariff program as a whole.
Refunds are now flowing through the Consolidated Administration and Processing of Entries tool, known as CAPE, which strips the IEEPA Chapter 99 lines and refunds the duties with interest. A first phase went live in April 2026 for unliquidated and recently liquidated entries. A second phase covering reconciliation entries is set to launch on June 29, 2026. A later phase for finally-liquidated entries is targeted for the summer but, on CBP's current position, only for importers who have filed suit at the Court of International Trade. That position is the contested edge. On May 29, 2026 CBP asserted that once an entry is finally liquidated it has no authority to reliquidate or refund without a court order, and it has appealed the trade court's broader injunction except as to named plaintiff importers.
For importers, the separation between these routes is where mistakes happen. CAPE is an automated reliquidation mechanism. The protest pathway under 19 U.S.C. 1514 and the post-summary correction are the traditional entry-by-entry tools. A parallel action at the Court of International Trade under 28 U.S.C. 1581(i) is currently the only assured path for finally-liquidated entries. A CAPE claim does not preserve protest rights, and a protest does not substitute for a suit on a finally-liquidated entry.
Section 122 is still unsettled
The President imposed a ten percent global surcharge under Section 122, a balance-of-payments provision that allows up to fifteen percent for up to one hundred fifty days, with collection beginning February 24, 2026. The Court of International Trade, in a divided May 7 decision, declared the surcharge invalid and enjoined collection, but only as to three plaintiffs with standing, and declined a universal injunction. The court granted relief to the State of Washington, Burlap and Barrel, and Basic Fun, and dismissed the other state plaintiffs for lack of standing. On June 11, 2026 the Federal Circuit granted the government's stay pending appeal, finding the government had made a sufficient showing that it is likely to succeed on the merits and that the trade court's narrow reading of the balance-of-payments provision may be incorrect, while stating it was not prejudicing the ultimate disposition by a merits panel.
The stay is a strong interim signal for the government, not a merits ruling. Importers should treat the surcharge as currently collectible, potentially refundable, and time-limited, with the current Section 122 collection period set to expire around July 24, 2026 unless replaced by another authority or new action (estimated as to the precise expiry date, which tracks the one-hundred-fifty-day window from the February start of collection).
The new Section 301 investigations
Functionally, the new investigations operate as the administration's post-IEEPA tariff-reconstruction platform. Legally, USTR frames them as investigations into discrete unfair practices, including forced-labor import-ban failures, structural excess capacity, Brazil-specific practices, Vietnam intellectual property enforcement, and related country or sector files. The difference is practical, not academic. The functional reading helps anticipate where rates land. The legal framing is what appears in any administrative record and any future challenge, and it governs procedural rights.
The forced-labor matter is proposed, not effective. It was initiated on March 12, 2026 and covers sixty economies, being fifty-nine countries plus the European Union. On June 2, 2026 USTR found all sixty actionable and proposed additional duties of ten percent for economies with a forced-labor import prohibition, a partial regime, or a reciprocal-trade commitment, and twelve and one-half percent for the rest, with Annex A exclusions covering Section 232 goods, certain raw materials, pharmaceuticals, aviation parts, and others, and a proposed textile and apparel mechanism tied to purchases of United States textiles and cotton. Comments are due July 6, 2026, hearing-appearance requests are due June 22, and the hearing is July 7. The ten percent tier closely matches rates negotiated under several IEEPA-era reciprocal-trade deals, which supports the functional reading, though the effective date remains unset (inferred as to the link between the tier and the prior deals).
The excess-capacity investigation is pending. It was initiated on March 11, 2026 and covers sixteen economies, namely China, the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, South Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India. Flagged sectors include aluminum, automobiles, batteries, cement, chemicals, electronics, glass, machine tools, semiconductors, ships, solar, and steel. Comments were due in mid-April and hearings ran in early May. No proposed action had issued as of June 16, 2026.
Other country-specific probes are active. The Brazil matter was initiated on July 15, 2025, and a June 1, 2026 determination found practices actionable and proposed a twenty-five percent tariff with extensive product and aircraft carve-outs, with comments due July 1 and a hearing on July 6 and a statutory deadline for responsive action around mid-July. The Vietnam intellectual property matter was initiated in late May 2026 after a Special 301 priority designation, with comments due in early July and a final determination due around late November. A China Phase One compliance review is underway, and holdover files include China shipbuilding and maritime, China semiconductors, and Nicaragua labor (Brazil and Vietnam deadlines estimated to the nearest reported dates).
A drug-pricing Section 301 probe has been urged but not initiated. On June 10, 2026 dozens of House Republicans urged USTR to open a Section 301 investigation into foreign drug-pricing practices. USTR had signaled in February that it would initiate such an investigation on an accelerated timeframe, but as of June 16, 2026 no formal pharmaceutical-pricing Section 301 investigation has been initiated.
What this means for entry posture
For Lists 3 and 4A, the conclusion is straightforward. Importers should treat the List 3 duties, raised to twenty-five percent, and the List 4A duties, reduced to seven and one-half percent, as permanent fixtures of landed cost. The refund question is where importers go wrong. They should not carry refund positions premised on the HMTX Section 307 modification theory. That theory, and the Administrative Procedure Act defect theory as it was actually litigated in HMTX, are effectively closed. Any remaining recovery path is narrow and entry-specific. It runs through granted exclusions, classification or origin corrections, Chapter 99 application errors, or other product or program-specific grounds. None of those is the HMTX theory, and none should be described to a client as a live path to recover Lists 3 and 4A duties on the ground that the modification exceeded USTR's authority.
Operationally, importers should hold a bifurcated model. The IEEPA layer is struck down and refundable through CAPE, subject to the finally-liquidated dispute. The Lists 3 and 4A Section 301 layer is upheld and durable, while Section 301 more broadly has become the administration's preferred vehicle. Many China-origin consumer goods bore both layers at once, and only the IEEPA layer is refundable. The Section 232 duties on steel, aluminum, copper, and autos, and the suspension of de minimis treatment for China, also survive. For an importer with stacked China-origin exposure, the recoverable cash is in the IEEPA layer, not in the Section 301 layer, except for narrow exclusion, classification, origin, or Chapter 99 correction grounds.
Going forward, supply-chain exposure analysis should assume that Section 301 and Section 232 tariffs persist and that new Section 301 tariffs on sixty or more economies should be modeled as a live Q3 2026 risk. The mitigation levers are familiar. They include USMCA qualification, foreign-trade zones, classification and tariff-engineering review, and sourcing diversification grounded in genuine substantial transformation rather than transshipment, which CBP actively polices, along with a bond-sufficiency review for any new duty layer.
Where the next challenge comes from
With IEEPA foreclosed and the administration pivoting to Section 301, the HMTX challengers argued that future Section 307 modification fights are inevitable. They predicted the issue would become a quickly recurring one once the President leaned more heavily on Sections 301 and 307, warned that the government's use of the modification path was all but inevitable, and noted that the Court would otherwise have to confront the question later in an emergency posture. They observed that the government initiated dozens of Section 301 investigations in a span of days, against roughly one hundred thirty in the statute's first forty-six years.
The merits theory that a modification exceeded USTR's authority is now foreclosed at the Federal Circuit, but the surviving theories define where the next challenge comes from. Administrative Procedure Act notice-and-comment challenges survive, because the HMTX holding on that point was specific to the cured remand, and procedural challenges to accelerated investigations that compress statutory comment or consultation periods are live. The argument that a specific Section 307 modification is untethered from the originally investigated practices also survives, because the Federal Circuit decided on Section 307(a)(1)(C) grounds and expressly declined to address the scope of subsection (B). Major-questions or nondelegation arguments remain available against a future expansion that is genuinely transformative rather than incremental, distinguishing the new-use framing that saved Lists 3 and 4A. The most likely single trigger for the next major challenge is a Section 307 increase to the new tariffs imposed without a fresh investigation.
Bottom line
HMTX closes the List 3 and 4A refund trade on the Section 307 modification theory. IEEPA remains the refund line, processed through CAPE and contested mainly at the finally-liquidated boundary. The next fight is whether USTR can use Section 301, and later Section 307, to rebuild the tariff wall without recreating IEEPA's legal defect.
For importers, the operating posture is narrow but urgent. Close out refund positions premised on HMTX. Maximize IEEPA recovery through CAPE, post-summary corrections, protests, and, where needed, Section 1581(i) litigation. Engage the open Section 301 dockets before the July deadlines. And for every new Section 301 duty layer, preserve entry-level rights from the first entry. Do not assume that class, universal, or programmatic relief will preserve the rights of importers that did not file suit, protest, correct, or otherwise preserve entry-level claims.
Caveats
The factual claims above are tied to the source trail. Interpretive and forecast statements are identified where the record does not itself establish the conclusion. The cert denial, the Federal Circuit holding, the IEEPA decision, the Section 122 stay, and the forced-labor, excess-capacity, Brazil, and Vietnam investigations are confirmed. Whether and when the new Section 301 tariffs take effect, and whether future Section 307 modifications will be challenged, are forecasts. The drug-pricing probe is urged, not initiated. The reading of the new investigations as a reconstruction platform is interpretation, and the legal framing as discrete unfair-practice cases is what governs.
On announced versus effective status, the forced-labor ten and twelve and one-half percent tariffs and the Brazil twenty-five percent tariff are proposed. The Section 122 surcharge is effective and being collected pending appeal. Lists 3 and 4A China duties are effective and durable. IEEPA duties are invalidated, with refunds in progress but contested for finally-liquidated entries.
Two source conflicts remain. The excess-capacity country count is sixteen economies on USTR's primary sources, being fifteen countries plus the European Union, against a Congressional Research Service description of fourteen countries plus the European Union, and the primary-source count is used here. The forced-labor ten percent tier composition is described differently across secondary analyses, and the categorization here follows USTR's framing by determination type rather than a fixed country count. Separately, the phrase that appears in some commentary as only a matter of time is a paraphrase, not a verbatim quote from the briefs, where the actual phrasings are all but inevitable and become a quickly recurring one. Reported totals for IEEPA duties collected range across different dates and measurement bases, from roughly one hundred twenty-nine billion dollars in late 2025 deposits to roughly one hundred sixty-six billion dollars collected as of the June 2026 hearing, and the latter is the most current figure for refund-scope purposes.
