Section 301: Forced-Labor Tariffs Spark State Lawsuit
As noted in our previous article, on July 24, 2026, the Trump administration invoked Section 301 of the Trade Act of 1974 against 60 economies worldwide, including China, the European Union, Mexico, and Canada, on the ground that these economies had failed to adopt or enforce prohibitions on the importation of goods produced with forced labor.
On August 3, 2026, the State of New York, together with a coalition of twenty-four other states, filed suit against the Trump administration challenging implementation of the Section 301 tariffs. The plaintiffs contend that the Section 301 tariffs are merely the prior tariffs—previously held unconstitutional—reissued under a different name. We will continue to monitor this matter and will provide updates as the litigation develops.
De Minimis Exception Elimination Following CIT Ruling
On August 13, 2026, the Court of International Trade (“CIT”) issued its decision in Axle of Dearborn, Inc. v. Department of Commerce. The Court held that the executive branch holds valid authority under the IEEPA to rescind the Section 321 de minimis exemption for goods valued at $800 or less. The panel clarified that withdrawing the duty-free privilege does not create a new tax, but simple subjects the low value shipments to existing congressionally approved rates.
The effect of this decision is forcing a major overhaul of e-commerce and logistic models. All direct-to-consumer imports, even those under $800, now face full duty rates. Businesses must quickly update their pricing and customs filings to cover these new costs.
CAPE Phase 3: Final Liquidated Entries
Previously, the CBP claimed that it lacked administrative authority to issue automatic refunds for finally liquidated entries. On July 15, 2026, Judge Eaton issued an Order which explicitly directs the CBP to reliquidate the entries under Phase 3 of the CAPE framework, overriding the standard administrative barrier.
The CIT reliquidation order provides individualized relief only to importers with pending cases. It is unclear whether the relief will extend to those without pending cases.
Immediate Action Required
If you have entries that fall under Phase 3, preserve your right to these refunds immediately. Contact our office to initiate protective CIT filings before any statutory windows close.