Tariff Refunds for Toy Importers: What the Freestyle World Class Action Means

Many toy companies import their products, and they paid the IEEPA tariffs that the Supreme Court later struck down. On Oct. 8, the U.S. Court of International Trade certified a class action that could cover tens of thousands of importers who haven't sued or haven't used the government's refund system. Here's what the court record says.

How We Got Here

On Feb. 20, 2026, the Supreme Court held in Learning Resources, Inc. v. Trump that "IEEPA does not authorize the President to impose tariffs." (Learning Resources is an educational toy company.) According to the Court of International Trade, when it issued an initial refund order in March, an estimated $166 billion in unlawfully collected duties had been assessed on 53 million entries, involving roughly 330,000 importers of record.

Most refunds are going through CAPE (Consolidated Administration and Processing of Entries), a system U.S. Customs and Border Protection added to its ACE online portal. The court called CAPE "a remarkable success." As of Oct. 2, 2026, about $136.6 billion had been accepted for processing in CAPE, and about $126 billion in duties plus interest had been refunded. The court said that more than 75% of the $166 billion was refunded within 215 days of the federal appeals court's mandate. The court has also ordered reliquidation in more than 4,000 lawsuits brought by individual importers.

The Class Action: Freestyle World v. United States

Freestyle World, Inc. filed suit on Feb. 19, 2026 (Court No. 26-01088). On Oct. 8, Judge Richard K. Eaton granted its motion and certified this class:

"All importers of record who paid duties imposed by the Challenged Tariff Orders between February 1, 2025, and February 19, 2026, excluding any entity that has separately filed an action seeking to recover IEEPA duties payments."

The plaintiff asks for an injunction directing liquidation or reliquidation of entries without regard to IEEPA duties. That would lead to refunds for the importers of record who paid. The court explained why it certified the class: if CAPE stopped working, about $30 billion would remain on deposit with the Treasury. Some importers haven't used CAPE, and the court said it believes they are "overwhelmingly small importers who, because of the cost or effort involved in filing a CAPE declaration, or because they are unaware of the program, will never take advantage of CAPE." CAPE also doesn't accept some kinds of entries, including finally liquidated entries of importers who haven't sued.

Key points from the opinion:

• The case hasn't been decided on the merits. The court noted that the Supreme Court's ruling "has yet to be applied to Freestyle's facts."
• The class was certified under USCIT Rule 23(b)(2). The court said membership in such a class "is mandatory and fixed," meaning there is no opt-out or opt-in.
• Companies that filed their own lawsuits are excluded. As of Oct. 7, 2026, more than 4,000 nearly identical cases had been filed, involving about 7,000 plaintiffs.
• Class counsel are Barnes, Richardson & Colburn, LLP and Lieff Cabraser Heimann & Bernstein, LLP.
• A separate appeal on finally liquidated entries, V.O.S. Selections, is fully briefed at the Federal Circuit. The court said a decision "will be rendered in due course."

Status as of Nov. 1, 2026: The court's opinion set a closed conference for Oct. 13 and told the parties to jointly propose a schedule for the case, including when the government will respond to the complaint. On Nov. 1, the court's class-action page listed only the Oct. 8 opinion, and no scheduling order was posted there.

What CBP Says About Refunds

CBP's IEEPA refunds page (last modified Oct. 28, 2026) says:

• Importers of record and their authorized customs brokers file a CAPE Declaration, a .CSV list of entries, through the ACE Secure Data Portal. Each declaration can hold up to 9,999 entries, and filers can submit more than one. Only the importer of record, or the authorized broker that filed the entries for it, may file.
• Importers need an ACE Portal account with bank account (ACH refund) information on file.
• CAPE Phase 1 covers certain unliquidated entries and certain entries within 80 days of liquidation. Phase 2 covers entries flagged for reconciliation where the reconciliation entry isn't yet on file.
• Valid refunds are "generally issued within 60 - 90 days following acceptance of the CAPE Declaration," unless a compliance concern requires more review.
• CBP charges no fees for tariff refunds. CBP says that if someone claiming to be CBP asks for a fee or financial information, "it is a scam." The page lists official CBP contacts for general and technical questions.

Refunds go to the importer of record that paid the duties, not to shoppers who bought the imported toys.

This article summarizes the court record and CBP's public guidance. It is not legal advice. Importers should speak with their customs broker or a trade attorney about their own entries.

For the full weekly market brief: The ToyDirectory Intelligence Report

Sources:

• U.S. Court of International Trade: Freestyle World, Inc. v. United States, Slip Op. 26-123 (Oct. 8, 2026)
• U.S. Court of International Trade: IEEPA Refund Class Action Litigation
• U.S. Customs and Border Protection: IEEPA Duty Refunds

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