I wasn’t buying pre-arrival, so I didn’t pay any attention to the language that retailers used. I would imaging that there was some pretty common language. (I remember people quoting it here – perhaps even up thread.)
What if it was along the lines of “if we’re charged tariffs, we’ll bill you for those.”
Now imagine that importers and distributors had similar terms in their agreements with retailers, and the importers and distributors obtain refunds and pass those along to retailers. (Don’t bet on that, obviously, but you can imagine that retailers would press them on it.)
Then consumers might have an argument that, under the language of their customer agreements, the retailers were not charged the tariff (because it was refunded).
In that scenario, it doesn’t seem so farfetched to imagine a class action on behalf of consumers against retailers. Of course, there would be issues about contract language, and maybe there would have to be separate classes for each retailer (in which case only the Total Wines of the world would be attractive targets for the plaintiff’s bar.)
I can also imagine plaintiffs’ lawyers arguing that consumers were the third-party beneficiaries of any importers/distributors contracts with retailers with language saying that they (importers/distributors) would pass on tariff costs if they had to pay them (and by implication would need to refund them if they receive a refund).
My 2023 Bordeaux futures are now arriving and I am still paying tariffs on those. None of this motivates me to purchase any further Bordeaux futures. How can any business make long term plans in this kind of environment?
The payment of the tariffs and the incidence of the tariffs are not the same.
The payments were made by the importer of record. The incidence - who “paid” in the sense of higher costs or lower revenues - is much more complicated to determine. The administration would have you believe that the incidence was entirely on foreign exporters (or "countries) who lowered their prices to cover the tariffs (i.e., “paid” them). Studies show this is incorrect, and that only about 5% of the incidence was borne by producers/exporters, and the rest by importers and their customers.
The administration clearly wants to make it a pain to recover unlawfully charged tariffs, though I suspect once the first few large companies prove entitlement to a refund, others will quickly follow. But what this also probably means is that large importers who can afford a lawyer to handle will get refunds. And in some cases their customers (e.g., FedEx customers who had FedEx pay the tariff on their behalf) will get refunds indirectly, a number of small businesses will not, or will sell claims to some sort of class action collector, and see a relatively small portion of what they paid refunded.
The government’s argument in the Circuit court was that it should delay by essentially three months the process of issuing its mandate and remanding to the Court of International Trade so it could start considering relief (eg, refunds to payers).
FWIW, if you can get your wine into the US in the next few days, you’ll avoid the planned increase from 10% to 15% (on everything). And you may have until August before they go up further (though those tariffs require a process to implement).
Court of International Trade orders admin to refund all tariffs illegally collected. No requirement for a separate suit. Link to decision in the description below.
Yes, it will be appealed. But it seems likely to force a faster resolution. The admins choice now is to start paying or get an order from a higher court that it can take a more limited approach. That’s faster than fully litigating cases and then appealing.
It seems like a pretty aggressive move, both for the scope which is somewhat justified by the unique aspects of this case, and because the judge didn’t hear merits arguments because he replied “there are no merits” when the government inquired. But, definitely will speed things along.
I’d be interested to hear a meritorious argument as to why refunds aren’t due, other than some technical “you didn’t pay under protest” type of procedural argument. It’s not like anyone is seeking a refund from decades ago.
I wonder whether there’s a subconscious pushback happening from judges towards the various executive issues they are having to handle? Part collective frustration with poor engagement with the courts (e.g. ICE, trying to ignore court judgments/demands) and part firm pushback against insults that have been directed their way from politicians.
I think it’s conscious at this point, at least from some judges. They used to give a presumption of honestly to the government, and that’s changed.
I suspect this judge recognized where this was going . . . that the admin was trying to stall and delay, and knew that whatever he ruled would be appealed anyway, causing further delay. So I suspect he issued as broad a ruling as possible, as quickly as possible, to force a prompt appeal and resolution. There may also be some annoyance that higher courts gave no indication of how refunds were to be handled (if available at all), which was a criticism of the Supreme Court opinion. (Though to be fair the issue wasn’t really addressed at the lower level either).
Here is a article about the Section 122 tariffs (and potential others). I think it’s likely the courts will allow them to continue while considering whether they are lawful which will likely take more than 150 days.
Idealwine is still letting people ship for 10% - I decided to pull the trigger today with some high end bottles that have been sitting with them for about a year now. Filled out the rest of a case with some $24 bottles of Lapierre Morgon and ate the 10%.
