Oregon v. United States

Slip Op. 26-53

UNITED STATES COURT OF INTERNATIONAL TRADE

THE STATE OF WASHINGTON,

Plaintiff,

Before: Mark A. Barnett, Claire R. Kelly, and Timothy C. Stanceu, Judges v.

Court No. 26-01472-3JP UNITED STATES, ET AL.,

Defendants.

BURLAP AND BARREL, INC., ET AL.,

Plaintiffs,

Before: Mark A. Barnett, Claire R. Kelly, v. and Timothy C. Stanceu, Judges

UNITED STATES, ET AL., Court No. 26-01606-3JP

Defendants.

OPINION AND ORDER

[Denying Defendants’ motion for a stay of enforcement of the judgment pending appeal.]

Dated: May 20, 2026 Freeman E. Halle, Assistant Attorney General, Office of the Washington State Attorney General, for Plaintiff The State of Washington. Also on the brief were Nicholas W. Brown, Attorney General, and Todd Sipe, Assistant Attorney General.

Jeffrey M. Schwab, Reilly W. Stephens, and James McQuaid, Liberty Justice Center, of Austin, TX, for Plaintiffs Burlap and Barrel, Inc., and Basic Fun, Inc. Claudia Burke, Deputy Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for Defendants United States, Donald J. Trump, in his official capacity as President of the United States, Department of Homeland Security, Markwayne Mullin, in his official capacity as Secretary of the Department of Homeland Security, United States Customs and Border Protection, Rodney S. Scott, in his official capacity as Commissioner of United States Customs and Border Protection, the Executive Office of the President, Jamieson Greer, in his official capacity as United States Trade Representative, and the Office of the United States Trade Representative. Also on the brief were Brett A. Shumate, Assistant Attorney General, Eric J. Hamilton, Deputy Assistant Attorney General, Patricia M. McCarthy, Director, and Justin R. Miller, Attorney-In-Charge, International Trade Field Office.

Barnett, Chief Judge: Plaintiffs1 in these companion cases contested the imposition of duties pursuant to Proclamation No. 11012, Imposing a Temporary Import Surcharge to Address Fundamental International Payments Problems (Feb. 20, 2026), 91 Fed. Reg. 9339 (Feb. 25, 2026) (“Proclamation No. 11012”), which invoked Section 122 of the Trade Act of 1974, 19 U.S.C. § 2312. See Compl. (Mar. 5, 2026), ECF No. 2, Ct. No. 26-01472; Compl. (Mar. 9, 2026), ECF No. 2, Ct. No. 26-01606. Defendants move for a stay of enforcement of the court’s judgment in these cases pending appeal to the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit” or “CAFC”). Mot. for a Stay of Enforcement of J. Pending Appeal (“Defs.’ Mot.”), ECF No. 53, Ct. No. 26- 01472;2 see also Oregon v. United States, Slip Op. 26-47, 2026 WL 1257669 (CIT May 7, 2026);3 J., ECF No. 50.4 Plaintiffs oppose the motion. Pl. States’ Resp. to Defs.’ Mot. to Stay (“State Pl.’s Resp.”), ECF No. 59; Pls.’ Resp. in Opp’n to Defs.’ Mot. for a Stay of Enforcement of J. Pending Appeal (“Priv. Pls.’ Resp.”), ECF No. 47. For the following reasons, the court denies the motion.

BACKGROUND

The court presumes familiarity with the background set forth in Oregon and supplements the background herein as necessary. On May 7, 2026, the court granted Plaintiffs’ motions for summary judgment with respect to Private Plaintiffs and the State of Washington. Oregon, 2026 WL 1257669, at *23; see also id. at *23–35 (Stanceu, J., dissenting). The court’s judgment declared Proclamation No. 11012 “invalid as contrary to law,” permanently enjoined Proclamation No. 11012 “with respect to The State of Washington (and its Instrumentalities), Burlap and Barrel, Inc., and Basic Fun, Inc. (the Importer Plaintiffs as defined in the court’s accompanying opinion),” and required Defendants to implement the permanent injunction within five days. J. at 1–2. The court also ordered “Section 122 duties paid by Importer Plaintiffs before this injunction is fully implemented” to be “refunded with interest as provided by law.” Id.

Defendants appealed this court’s judgment on May 8, 2026. Defs.’ Notice of Appeal, ECF No. 51. On May 11, 2026, Defendants filed the instant motion. Defendants also requested an immediate administrative stay and a stay pending conclusion of the appeal from the Federal Circuit. See Order from CAFC (May 12, 2026) (“CAFC Admin. Stay”), ECF No. 54 (order from the Federal Circuit docketed herein). The Federal Circuit granted Defendants’ “requests for an immediate administrative stay . . . to the extent that the judgment and the permanent injunction entered by the CIT in these cases are temporarily stayed until further notice while this court considers the motions for a stay pending appeal” and set a briefing schedule on the motion, id. at 3, which it subsequently revised, Order from CAFC (May 13, 2026), ECF No. 56. This court also set, and subsequently revised, a response deadline for Plaintiffs. Order (May 12, 2026), ECF No. 55; Order (May 13, 2026), ECF No. 57. Plaintiffs timely filed their respective responses. See State Pl.’s Resp.; Priv. Pls.’ Resp.

JURISDICTION AND STANDARD OF REVIEW

The court exercises subject-matter jurisdiction pursuant to 28 U.S.C. § 1581(i)(1)(B) (2018 & Supp. II 2022). See Oregon, 2026 WL 1257669, at *7. While the court has discretion to stay the enforcement of a judgment pending appeal pursuant to U.S. Court of International Trade (“CIT”) Rule 62(d),5 “[a] stay is an ‘intrusion into the ordinary processes of administration and judicial review’” and is “not a matter of right.” Nken v. Holder, 556 U.S. 418, 427 (2009) (citation omitted). When deciding whether to grant the motion, the court considers “(1) whether the stay applicant has made a strong showing that [it] is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies.” Hilton v. Braunskill, 481 U.S. 770, 776 (1987). “The first two considerations ‘are the most critical,’ and the party requesting a stay bears the burden of showing that the circumstances justify an exercise of the court’s discretion.” Transpacific Steel LLC v. United States, 44 CIT __, __, 474 F. Supp. 3d 1332, 1337 (2020) (quoting Nken, 556 U.S. at 433–35).

DISCUSSION

I. Irreparable Harm6

This court entered an injunction barring the Government from collecting Section 122 duties only from the three successful Importer Plaintiffs and ordered the suspend the injunction] must be made either: (1) by that court sitting in open session; or (2) by the assent of all its judges, as evidenced by their signatures.” CIT Rule 62(d). Government to refund any Section 122 duties the Importer Plaintiffs paid before the injunction went into effect. J. at 1–2. Defendants’ assertions of irreparable harm, broadly framed as harm to the President’s ability to conduct trade negotiations, manage foreign affairs, and address the U.S. balance-of-payments position, see Defs.’ Mot. at 5–7, fail to address the limited nature of this injunction applicable “to one spice importer, one toy company, and one state government whose state universities pay tariffs directly,” State Pl.’s Resp. at 4–5. The Government’s reliance on a claimed “intrusion on the President’s conduct of foreign affairs,” Defs.’ Mot. at 5, also fails to acknowledge Congress’s constitutional role in the imposition of taxes and duties, see Oregon, 2026 WL 1257669, at *2, *12 (citing U.S. Const. art. I, § 8, cl. 1); Priv. Pls.’ Resp. at 7, or the Judiciary’s role in “protect[ing] Congress’s constitutional authority from executive incursion,” State Pl.’s Resp. at 4; see also U.S. Const. art III, § 1. On these bases alone, Defendants fail to persuade the court that forgoing the collection of Section 122 duties from the three successful Importer Plaintiffs will cause the Government irreparable harm.7

Defendants further argue that even if they prevail on appeal, they may never recover the duties that otherwise would have been collected during the 150-day period of applicability of Proclamation No. 11012. See Defs.’ Mot. at 8. This court’s judgment required U.S. Customs and Border Protection (“CBP”) to effectuate the permanent injunction, not the refunds, within five days. J. at 2. Refunds in the normal course of liquidation are thus consistent with the Judgment.8 Moreover, the court’s judgment did not constrain CBP’s authority to “extend the 1-year statutory period for liquidation for an additional period not to exceed 1 year” if CBP needs additional information “for the proper appraisement or classification of the merchandise.” 19 C.F.R. § 159.12(a)(1)(i). CBP may extend liquidation for up to three years. Id. § 159.12(e). Thus, CBP can ensure its ability to collect Section 122 duties if Defendants prevail, and any concerns about nonpayment are speculative.9

Defendants next assert that “the injunction would cripple CBP’s ability to function at a particularly critical time” given the steps involved in reprogramming its automated system of record for imported merchandise, the anticipated “flood” of additional cases seeking injunctive relief, and the unworkability of extending the time period for the liquidation of millions of entries ultimately subject to Section 122 duties. Defs.’ Mot. at 9–10. Again, Defendants’ concerns are purely speculative. As of this date, the above- captioned cases are the only cases challenging the imposition of duties in Proclamation No. 11012. The court will not constrain the relief available to the three successful Importer Plaintiffs based only on speculation.10 If the court is faced with additional cases challenging the imposition of Section 122 duties pursuant to Proclamation No. 11012, the court will determine whether any specific case management procedures or other forms of relief are required based on the facts at that time.

II. Injury to Importer Plaintiffs

Defendants dismiss the possibility of harm to the three Importer Plaintiffs as mere delay in obtaining the return of Section 122 duty deposits, arguing that “[t]his harm is, by definition, not irreparable.” Defs.’ Mot. at 11–12. “Irreparable harm” to Plaintiffs is not the standard; rather, the court weighs the likelihood of substantial injury to the other parties to the proceeding, i.e., the Importer Plaintiffs. See Hilton, 481 U.S. at 776. It is difficult to see how continuing to pay unlawful Section 122 duties to the Government only to wait months, if not years, for any refund would not qualify as substantial injury. Moreover, Defendants fail to address the court’s additional reasons for entering a permanent injunction in the first instance. See Oregon, 2026 WL 1257669, at *21–22. A stay will compound the losses, such as “lost profits and damage to business relationships, investments, and innovation” as a result of the Section 122 tariffs. Id. at *22; see also Priv. Pls.’ Resp. at 4.

III. Public Interest

Regarding the public interest, Defendants identify the need for the President to address “threats to the United States’ economy, military preparedness, and national security.” Defs.’ Mot. at 12.11 For that proposition the Government cites Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7, 24 (2008), see Defs.’ Mot. at 12, when the Supreme Court concluded that a preliminary injunction burdened “the [U.S.] Navy’s ability to conduct realistic training exercises” with a resulting “adverse impact on the public interest in national defense,” Winter, 555 U.S. at 24. The Government also cites PrimeSource Building Products, Inc. v. United States, 45 CIT __, __, 535 F. Supp. 3d 1327, 1335 (2021). See Defs.’ Mot. at 12. There, the court granted the Government’s motion for a partial stay of the judgment based, in part, on intervening appellate authority and the need for “due consideration” to the Government’s corresponding “potential claim to the revenue.” PrimeSource, 535 F. Supp. 3d at 1335. Neither circumstance is present here. Furthermore, “Section 122 is not triggered by generalized appeals to ‘economic and national security interests,’” Priv. Pls.’ Resp. at 7, and as such, these generalized concerns are also not a basis to stay this court’s judgment.

Defendants assert that “there is a strong public interest in allowing the Executive Branch to implement administration policies.” Defs.’ Mot. at 7 (citing Trump v. Orr, 146 S. Ct. 44, 46 (2025); Trump v. CASA, Inc., 606 U.S. 831, 859 (2025)). Orr and CASA, however, are distinguishable. Orr considered a stay motion in the context of class-wide relief. 146 S. Ct. at 46 (citing CASA, 606 U.S. at 831, 861). CASA addressed the issue of universal preliminary injunctions. 606 U.S. at 838. The relevant discussion in CASA, cited in Orr, emphasized the universal nature of the injunctive relief granted by the lower courts, finding irreparable harm from the lower courts’ respective entries of a universal injunction “that likely exceed[ed] the authority conferred by the Judiciary Act,” distinct from any harm arising from the restraint of an Executive policy. Id. at 859–60. In Oregon, this court declined to enter a universal injunction and instead granted importer- specific relief. 2026 WL 1257669, at *21–23. Thus, the harms claimed in CASA and Orr are not present here. Additionally, as previously stated, it is Congress that possesses inherent constitutional authority to impose tariffs, U.S. Const. art. I, § 8, and it is thus “up to Congress, not the [Executive], to decide whether the public interest merits further action” in response to well-intended but unlawful executive action, Ala. Ass’n of Realtors v. U.S. Dep’t of Health & Hum. Servs., 594 U.S. 758, 766 (2021) (vacating a stay of a judgment holding unlawful a COVID-era eviction moratorium); see also Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 582, 585–86 (1952) (finding an executive action unlawful due to a lack of congressional authorization, despite the President’s finding that the “action was necessary to avert a national catastrophe”).

IV. Likelihood of Success on the Merits12

Defendants address the likelihood of success on the merits last, Defs.’ Mot. at 13–15, even though it is one of the two “most critical,” Nken, 556 U.S. at 434. Aside from recounting arguments that the Oregon majority rejected, Defendants contest the court’s reliance on legislative history. Defs.’ Mot. at 14 (arguing “legislative history is not the law” (quoting Azar v. Allina Health Servs., 587 U.S. 566, 579 (2019))). However, in Azar, the Supreme Court rejected the Government’s reliance on “ambiguous” legislative history when the statutory text “clearly foreclose[d] the government’s position.” 587 U.S. at 580. Here, the statute does not expressly define “balance-of-payments deficits.” Oregon, 2026 WL 1257669, at *13–16. Thus, Defendants’ motion for a stay of enforcement of the court’s judgment is denied.

CONCLUSION AND ORDER

In accordance with the foregoing, it is hereby ORDERED that Defendants’ motion for a stay of enforcement of the judgment pending appeal (ECF No. 53, Ct. No. 26- 01472; ECF No. 42, Ct. No. 26-01606) is DENIED.

/s/ Mark A. Barnett Mark A. Barnett, Chief Judge /s/ Claire R. Kelly Claire R. Kelly, Judge /s/ Timothy C. Stanceu Timothy C. Stanceu, Judge

Dated: May 20, 2026

New York, New York