FedEx has sued the US government in federal court seeking a full refund of Trump tariffs it paid, just days after the Supreme Court ruled those duties illegal. The company, a major shipping giant, wants every dollar back from tariffs tied to a 1977 law called IEEPA that the court said President Trump misused. This comes amid warnings from the Trump administration that any refunds might drag on for years. It's a bold step. One that could shake up how businesses recover cash from past government actions.
Key Takeaways
- FedEx demands a complete refund of all IEEPA-based tariffs it paid to the US.
- Supreme Court struck down the tariffs Friday in a 6-3 ruling, saying Trump exceeded his powers.
- Tariffs topped $200 billion in 2025 collections, with refunds now in question.
- Government hints repayments could take years, even as importers push back.
Background
The story starts back when President Trump used emergency powers to slap tariffs on imports. He leaned on the International Emergency Economic Powers Act, or IEEPA, passed in 1977. That law lets the president handle threats from abroad by regulating trade. But Trump went further. He imposed broad tariffs on goods from many countries. Small businesses and some states fought back right away. They said those moves broke the law.
Lower courts sided with the challengers first. But appeals kept the tariffs in place while cases climbed to the Supreme Court. Importers kept paying. Billions flowed into government coffers. FedEx paid its share. So did others in shipping and manufacturing. And then, last Friday, the high court ruled.
Chief Justice John Roberts wrote the main opinion. He said IEEPA doesn't mention tariffs at all. "Those words cannot bear such weight," Roberts noted about Trump's broad read of the law. The court split 6-3. Justices Gorsuch and Barrett joined parts of it too. They invoked the major questions doctrine. That's a rule saying Congress must speak clearly on big economic moves. Trump's tariffs failed that test.
But the ruling left a gap. The justices didn't say how or if the government must refund the money. Justice Kavanaugh dissented. In a long opinion, he argued tariffs fit IEEPA's tools to regulate imports. He worried about refunds hitting taxpayers hard, since some costs passed to buyers.
FedEx didn't wait. The company filed suit this week. It's asking for its money back, dollar for dollar. This isn't their first rodeo with tariffs. They've dealt with steel and aluminum duties before. But these IEEPA ones hit wide. From electronics to auto parts. Shippers like FedEx felt the pinch on every package crossing borders.
Business groups cheered the ruling. Chambers of commerce called it a win for rule of law. States like those who sued said it protects local jobs hurt by higher costs. Trump officials stayed quiet at first. Then came the warning. Refunds won't come quick. Or easy.
Key Details
FedEx's lawsuit lands in a US district court. The company names top officials as defendants. Customs and Border Protection. The Treasury Department. They want a court order forcing full repayment. With interest, maybe. Filings show FedEx paid millions over years. Exact figures stay under wraps for now. But scale matches the $200 billion total from 2025 alone.
The Supreme Court decision splintered. Roberts' opinion got broad support on key points. All three Democratic justices joined the part saying IEEPA's text doesn't back tariffs. That's Sotomayor, Kagan, and Jackson. They agreed the law covers blocking or regulating imports. Not taxing them outright.
Roberts pointed to history. No president before Trump read IEEPA this way. Congress sets tariffs explicitly elsewhere. With limits. Trump's version had none. He could tweak rates anytime. On any good. After declaring an emergency courts couldn't touch.
The Dissent and Refund Fight
Kavanaugh's dissent ran 63 pages. He called tariffs a standard import tool. Policy fights belong to Congress, he said. Not judges. On refunds, he flagged risks. Importers might have raised prices. Consumers paid indirectly. Government can't just hand cash back without checks.
"The federal government 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." – Justice Brett Kavanaugh
Trump admin echoes that now. Officials say processing claims takes time. Years, even. They point to past refund battles. Like Section 301 tariffs on China. Those dragged through appeals. Some firms still wait.
FedEx argues it's simple. Court ruled the tariffs unlawful. Payments were forced. Give it back. The suit seeks class action status too. To rope in other payers. That could balloon the pot.
And it's not alone. Other firms eye similar moves. Walmart. Home Depot. They paid big. Trump’s New Tariffs Fail to Shake Steady Markets. Markets shrugged off tariff news before. But refunds? That's new money flowing.
What This Means
For FedEx, cash back means better margins. Shipping costs drop retroactively. They can cut rates or invest. Shareholders watch close. Stock dipped on tariff news years back. Now it might climb.
Wider economy feels ripples. $200 billion returned? That's stimulus. Spread to businesses hit hard. Manufacturers pass savings to buyers. Inflation eases a bit. But government loses revenue. Budget holes open. Congress might need to act. Plug gaps elsewhere.
Legal fights multiply. More suits incoming. Courts face backlog. Precedents set. Future presidents think twice on emergency powers. IEEPA gets a narrower read. Trade policy shifts to Congress. Where it belongs, some say.
Trump team digs in. They warn of long waits. Maybe caps on refunds. Or offsets for passed-on costs. Businesses push for speed. Full amounts. Lobbyists swarm DC. Hearings loom.
Global trade watches. Allies hit by tariffs cheer. China too, quietly. Supply chains adjust less frantically. But uncertainty lingers. Will new tariffs pop up? Under different laws?
Consumers? Pocketbooks matter most. Lower import costs help. Grocery bills. Electronics. Cars. But tax hikes could follow if revenue dips. Balance tricky.
Businesses like FedEx bet on courts. They've won round one. Round two's about the money. And it won't be quick.
Frequently Asked Questions
What did the Supreme Court rule on the tariffs?
The court said in a 6-3 decision that Trump lacked power under IEEPA to impose the tariffs. The law doesn't authorize taxing imports that way.
How much money is at stake in refunds?
Tariffs collected hit over $200 billion in 2025. FedEx seeks its full share, part of potentially billions across all importers.
Will FedEx get its money back soon?
Trump officials say no. Refunds could take years due to processing and disputes over who paid what.
Frequently Asked Questions
What did the Supreme Court rule on the Trump tariffs?
In a 6-3 decision, the court ruled Trump exceeded his powers under IEEPA to impose the tariffs, as the law does not authorize them.
How much are the potential refunds?
Tariff collections exceeded $200 billion in 2025; FedEx and others seek full repayment of their shares.
Why might refunds take years?
The Trump administration cites processing challenges, disputes over passed-on costs, and legal backlogs from similar cases.
