The courts have now struck down the two main pillars of the tariff program. Let’s start with the IEEPA duties — what’s happening on the ground right now?

On the IEEPA duties, the Customs Service has started refunding the money. There are actual live people who have received money starting on May 11th. The process is that they’ve created a mechanism for gaining the refunds that’s broken up into different phases. We’re now in Phase 1, which covers all shipments that have not been liquidated or that were liquidated within the last 80 days. The burden is on the importer to upload a spreadsheet — a spreadsheet of all their entries that fit those criteria, i.e., they’ve either not been liquidated or they were liquidated within the last 80 days.

What does “liquidated” mean in this context? It’s not a term most people know.

It’s an important term for your readers to understand because “liquidated”, a lot of people think they import something into the United States, Customs clears it, they maybe sell it downstream, it enters commerce. But from Customs’ point of view, it is not final. They can still come back and ask for more duties, and they have 314 days to do that. And that process of finalization is called “liquidation.”

So even after the goods have changed hands multiple times — bought, sold, consumed — the importer is still technically on the hook?

Yep. The importer of record — Customs can come back and say you owe more duties because they maybe disagree with the classification you brought it in under, or some other reason. Maybe there’s anti-dumping duties or other kinds of duties that you didn’t pay. Nothing is final until the shipment is liquidated.

And if something was already liquidated before you can file a Phase 1 claim?

If it was liquidated, you will get something back, but you may be part of Phase 2. This is Phase 1 — liquidated within 80 days. So if something was liquidated 90 days ago, you can’t put in now in Phase 1, but you will get your refund eventually when they come up with Phase 2. If something has been liquidated and it’s beyond that 80 days, you have to make sure you don’t hit 180 days, because if it’s more than 80 days but less than 180 days, you have to file what’s called a protest. But basically, you’re either in Phase 1 or you’re in Phase 2.

So the refund goes to the importer. What about the retailers, the small businesses, the consumers who absorbed those higher prices?

It’s just the importer, not the retailer. There’s been a number of lawsuits. People suing the importer. Costco $COST has been sued. I think Walmart $WMT has been sued. FedEx $FDX and DHL have been sued. If you had the foresight to make a contract with your provider saying, “if you get this money back, you’ve got to refund me,” but otherwise [the importer] has no legal obligation [to pay you back].

Why did the courts strike down the IEEPA tariffs in the first place?

They found them unconstitutional. The Constitution, Clause 8 of Section 1 of the Constitution, gives Congress the authority to levy taxes, and that includes import duties. The Court found that the president doing it was illegal. Unconstitutional. They found that you could not levy taxes or import duties under any circumstances under IEEPA. IEEPA does not use the word taxes or customs duties anywhere in the provision. That’s meant for other purposes.

And then the administration tried a different legal basis — Section 122 — to impose a blanket 10% tariff on imports. What happened there?

The Court of International Trade in New York ruled that that is illegal. Section 122 allows the president to levy taxes when it’s necessary to correct a balance of payment problem with another country. And the administration did not find any of these balance of payment inequities with any other country. And that was a prerequisite. The administration just didn’t want to do the homework.

What’s actually left standing, then? What tariffs are still in effect?

There’s the normal tariffs, which we refer to as the most favored nation tariffs. Those are approved by Congress. Now the administration has brought some more, 76 more Section 301 cases that are being considered now by the Office of the U.S. Trade Representative. The administration is hoping to replace all these tariffs with new Section 301 tariffs. The IEEPA duties are not in effect.

And the 10% Section 122 tariff — is Customs still collecting it while this is being litigated?

The Court said, yes, we find them illegal, but we’re going to allow Customs to continue to collect the 10% while this is being litigated. And ultimately, maybe it goes up to the Supreme Court, and they’re going to have to have another refund system just like they did for IEEPA.

You filed suit on behalf of 100 companies. What are the stakes for your clients?

The largest is expecting $8 million back in refunds, the smallest $1,500.

Have any of your clients been casualties of this — gone out of business entirely?

Some of them did, because they couldn’t afford to pay the tariffs at the time. A toy company who were bringing in all the toys from China and South Korea.

—Peter S. Green

(This interview has been edited and condensed for clarity and length)

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Big Businesses mentioned this week

The usual suspects

• eBay to Gamestop: Sorry, I gotta wash my hair tonight. Calling GameStop $GME CEO Ryan Cohen’s surprise $56 billion cash and stock offer “neither credible nor attractive,” Ebay‘s $EBAY board said it had “thoroughly reviewed your proposal and has determined to reject it,” citing the unlikelihood of the deal getting financed (GameStop’s market cap is just $10.3 billion) and its lack of confidence in Cohen’s management ability. Cohen told eBay’s board he wanted to make the merged company into the pre-eminent e-commerce site for collectibles, gaming and enthusiast communities, and had a promise of a potential $20 billion in financing from TD Bank of Canada, if GameStop got an investment grade rating from two out of three top credit rating forms. Standard & Poor’s withdrew its credit ratings from GameStop in 2022 at the company’s request. Cohen told the FT last week that if eBay rejected his bid he’d make a hostile bid. “I’m not going to take no for an answer,” he said. “I’m a pain in the ass.” Gamestop shares fell more than 9% this week, while eBay shares have climbed nearly 6%.
• IPOs Run on Dunkin ‘: Dunkin’, the chain formerly known as Dunkin’ Donuts, is going public in an IPO of parent Inspire Brands, which also owns Arby’s, Buffalo Wild Wings, Rusty Taco and Sonic Drive-In. With some 33,000 outlets driving $33 billion in revenue, an investor could be forgiven for thinking the IPO was to raise cash for expansion. But no, the $2 billion Inspire plans to raise will help pay back some of the money it owes its creator, PE fund Roark Capital, for buying Dunkin and the other brands in the first place. And while you, too, could own a Munchkin-sized stake in the company, as financial commentator Aalok Rathod noted in a post this week, “When this IPO prices, remember: you’re not investing in the future of fast casual dining. You’re refinancing someone else’s acquisition spree, one Boston Kreme at a time.”
• Shaken Shack: Shares in bourgois McDonald’s upgrade Shake Shack $SHAK plunged as much as 30% late last week, after the company said it lost money as foreign tourists avoid the U.S. over visa issues, winter storms cut into business, beef prices rose by about 17% and investments in new locations and products haven’t yet paid off. By Thursday, shares were down 55% from their peak last July.
• Can Spirit resurrect JetBlue? All the focus on the demise of Spirit may have left you forgetting the trouble that for the past decade has beset JetBlue $JBLU, and seen the airline lose 80% of its market value. With less than a 5% share of the U.S. market, it’s too small to compete with United $UAL, Delta $DAL and American $AAL, and a merger with Spirit several years back was blocked by regulators who saw the merger would have removed the pressure for cheap flights that Spirit imposed on the market. JetBlue has lost money every year since 2019, accumulating about $8.5 billion in debt. Well, Spirit is gone, and JetBlue may just have found salvation, taking some of its slots and flight routes, in the week since Spirit folded its wings and stopped putting downward pressure on airfares. JetBlue now has its eye on Spirit’s Ft. Lauderdale home base, say reports.
• Polymarket Insiders: Sometimes it pays to crunch the numbers: The New York Times did a deep dive into the numbers around Polymarket $POLYMARKET wagers on global events and other happenings that have garnered outsized returns on not-very-sure bets. The upshot: More than 80 Polymarket users have placed bets with “suspicious characteristics,” the paper reported, including 38 “whose well-timed wagers” have gone largely unnoticed, among them a bet on Israel’s strike on Iran last year and one on crypto regulation. The president’s son, Donald Trump, Jr., has a multi-million-dollar stake in Polymarket through his venture capital investment firm and the investment coincided with laxer regulation on the company.

The short stack

• Jack Daniels goes Cold Turkey: Just a couple weeks after turning down a $15 billion stock and cash offer from French drinks maker Pernod-Ricard, Louisville’s Brown Forman $BF.A the owners of Jack Daniels, see their future neat: They’ve turned down a $15 billion all-cash offer from privately held fellow bourbon-maker Sazerac. The sale would have created a colossus with about 30% of the U.S. whiskey market, giving it significant pricing power. The news is surprising, given that family-controlled—and run—Brown Forman has seen its share price slide by about two-thrids in five years, and observers largely fault the abilities of the family’s chosen executives to run the distiller. With both suitors now sent packing, the Browns appear ready to go it on their own. Brown Forman shares are down 5% since the news broke.
• Buzzcut: Byron Allen says he’s buying control of the aging cat-meme news website Buzzfeed, just weeks before his “Comics Unleashed” is supposed to replace Stephen Colbert’s “Late Show” on CBS $CBS. Allen will become BuzzFeed’s CEO and chairman, replacing founder Jonah Peretti, who said earlier this year that BuzzFeed is losing money, having piled up more than $50 million in debt. Allen said he plans to make the company succeed by beefing up BuzzFeed’s local U.S. news coverage and posting more videos made by BuzzFeed readers. Time to tee up your cat videos again?
• Shotgun wedding; Well, not quite, but Italian gunmaker Beretta, the maker of James Bond’s original gun, before it was replaced by the Walther PPK in the opening scenes of the first movie, 1962’s “Dr. No”, has officially joined forces with U.S. gunmaker Ruger $RGR. A testy takeover bid by the family-owned Italian gunsmith has ended with Beretta poised to take a 25% stake in U.S.-listed Ruger, gain two seats on Ruger’s nine-member board and a fast track into the world’s largest gun market, and have a chance to launch a tender offer for the whole company. Shares in Ruger have lost about half their value in the last five years, and the company posted a net loss in 2025 for the second consecutive year. Perhaps you’d be better off with a Walther, 007?
• Streaming steals TV ads: In mid-May every year, New York’s theaters fill up with TV executives and advertisers for the so-called “upfronts,” where the networks and streaming platforms try to sell advertisers on their upcoming programming. Now, as “streamflation” hits the main platforms, including Netflix $NFLX, Comcast’s $CMCSA Peacock, Paramount‘s $PSKY Paramount+, and Disney’s $DIS Disney+, more viewers are opting for cheaper or free ad-supported streams. A Morning Consult survey showed 56% of adults, led, of course, by the ad-aware Boomers at 67%, prefer lower-cost ad-filled streaming plans. That’s got advertisers moving their dollars from the old linear TV networks to streamers, with the two expected to split the $40 billion U.S. ad pot in roughly equal parts by 2029, as the Wall Street Journal reports.
• Money for nothing? As OpenAI raises money at ever-loftier valuations, but is still years away from a profit or an IPO that would set its fair market value, early investors are recording a paper killing. Take SoftBank $SFTBY, whose 13% stake in OpenAI jumped in value by $44 billion, including a $25 billion jump in the first quarter. That’s helped push up Softbank’s share price by more than 200% in the past year. But much of SoftBank’s investment in OpenAI is borrowed, and if a planned OpenAI IPO this year falls short, SoftBank could see a wipeout like the one it took when it backed office company WeWork a decade ago.
• Hackers look for a bigger Canvas: Millions of students across the U.S. got locked out of their main instructional platform, Canvas, in the hacking equivalent of stealing a schoolkid’s lunch money. Ransomware group ShinyHunters hacked into Canvas parent Instructure $INST, stealing billions of messages and more than 275 million personal records. The hack was vast. 41% of U.S. colleges and universities use Canvas, and some 8,800 school districts and education platforms use it. Statewide tests in New York were postponed. Instructure says it reached an agreement with the hackers, but it has not revealed how much it paid to get the data back.

Trumplandia

• The China Gambit: With president Trump in China, there’s a lot riding on his talks with Chinese leader Xi Jinping. At the heart of it is avoiding two wars: a hot war over Taiwan, the democratic island that China considers part of its territory, and which has long been a U.S. ally and a big buyer of U.S. arms (Taiwan has bought nearly 200 U.S.-made Lockheed Martin $LMT F-16 fighter jets), and a trade war. Emboldened by the U.S. failure to bring Iran to heel, the hot war may still be on the burner, but both sides see the trade war as a bigger threat to their countries. Xi appeared to accede to Trump’s demands that China open its markets to more U.S. products, telling Trump China will “open wider” to U.S. companies. Trump was accompanied by Tesla $TSLA boss Elon Musk, Nvidia $NVDA CEO Jensen Huang, and outgoing Apple $AAPL CEO Tim Cook. Boeing $BA chief Kelly Ortberg is expected to sign some large orders for planes on the trip. Also on the trip with those CEO’s: Eric Trump, who the Financial Times reports is exploring a deal with a Chinese chipmaker linked to the ruling Communist Party. Eric Trump is an advisor to Alt5 Sigma (also known as AI Financial Corporation $AIFC), a Las Vegas-based fintech company whose board chair is Trump aide Steve Witkoff’s son Zach. Alt5 and Hangzhou-based Nano Labs are in talks to build cloud computing centers in the U.S.
• The war isn’t helping the U.S. economy: The Consumer Price Index rose 3.8% in April from a year earlier, with higher gas prices replacing tariffs as the key inflation driver, while wholesale prices, measured by the Producer Price Index, rose 1.4% in April alone, up 6% from last year. And it’s not just gas. Even tomatoes are getting pricer, up 40% in April from last year, with growers blaming intense rains, crop disease, a new 17% tariff, and surging gas costs for bringing tomatoes to the U.S. from Mexico. High gas prices also appear to be hammering beer sales, according to Nielsen data, with sales at convenience stores and gas stations down about 9% in early May. In California, where gas prices are the highest in the nation, beer sales dropped 16% in April. The price uncertainty is also hammering the real estate market, where most Americans make their biggest purchase ever: Existing home sales were flat in April, after dropping 3.6% in March, the National Association of Realtors reported. President Trump says he knows how to bring down gasoline prices, which are up more than 50% since the U.S. and Israel launched their bombardment of Iran. Trump says he’ll cut the 18.4 cents-a-gallon federal excise tax on gasoline. But that’s hardly going to make a dent in gas prices. It would cut costs by 4%, lowering the average price to $4.32 a gallon.
• The trials and travails of Kevin W. So after months of waiting, President Trump’s pick for Fed chair, Ronald Lauder’s son-in-law Kevin Warsh won Senate confirmation (54-45) with Pennsylvania Sen. John Fetterman crossing party lines to support Warsh. Trump’s arch-Fed-enemy Jay Powell will stay on as a governor for another two years, and adding Warsh to the board means Trump’s temporary appointee, Stephen Miran, will have to step down, so there’s no guarantee of a consensus to lower interest rates, which could spur economic growth and/or a recession depending on which analyst or Fed board appointeee you’re talking to. “The economy is not in a “golden age” of high productivity growth and low inflation,” as Warsh told senators at his confirmation hearing, writes Fed watcher Ethan Harris. That is likely to leave Warsh, who’s only got one vote on the rate-setting Federal Open Market Committee, avoiding a rate cut in order to tame inflation.