Target, Ralph Lauren Among 3,500 Firms Suing for Trump Tariff Refunds

Date: Wednesday, September 30, 2020
Source: Sourcing Journal

As many as 3,500 companies represented by multiple law firms have now joined a lawsuit against the Trump administration at the U.S. Court of International Trade (CIT) that contests the assessment of List 3 and List 4 tariffs imposed on China-made goods under Section 301 of the Trade Act of 1974, according to Nicole Bivens Collinson, president of international trade and government relations at Sandler, Travis & Rosenberg.

Speaking on a webinar on Tuesday, Collinson said the legal action centers around the charge that the Office of the U.S. Trade Representative “failed to meet a timelines of action under the Trade Act…and otherwise violated the Administrative procedures Act.”

The CIT challenge involves $200 billion of imported goods, including apparel, footwear and textiles in the administration’s “List 3” 25 percent tariffs, and $129 billion from “List 4” 7.5 percent tariffs.

Attorney Peter W. Klestadt of Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt said earlier this month that the lawsuit also asserts that the duties were imposed to retaliate against Chinese tariff measures, rather than to remedy the Asian nation’s unfair trade practices, and therefore were not authorized under the Trade Act.

Klestadt and Collinson both noted that if successful, these cases could result in the refund to the plaintiffs of all tariffs they paid on the List 3 and 4 goods over the past two years, and up until the case is resolved.

“It is probable that only importers that file their own lawsuits will be able to recover refunds, at least with respect to entries that have been liquidated by CBP (Customs & Border Protection),” he said. “While importers can file protests on liquidated entries, there is no certainty that CBP would be authorized to issue refunds to importers without a case filed in court.”

According to a Reuters report, Target Corp. and Ralph Lauren are among the companies involved in taking action.

Also this month, a World Trade Organization (WTO) dispute panel report concluded that actions taken by the United States to combat China’s alleged theft of U.S. technology and intellectual property were inconsistent with the global trade body’s rules. The panel found that punitive tariffs imposed on a wide range of Chinese imports were inconsistent because they applied only to products from China and because they were applied in excess of the rates to which the U.S. had previously agreed upon.

Collinson noted that the Trump administration said it would appeal the ruling, but that the WTO Appeals Panel is nonoperative because the U.S. has declined to approve several members appointed to the seven-person body.