Supreme Court to Redefine the President’s Power to Fire Independent Agency Heads- Implications for Business
Since returning to office in January 2025, President Trump has made broad assertions of executive authority, including the power to fire independent agency heads at will.1 For almost a century, these officials have been protected by law from such “without cause” removals, enjoying insulation from direct presidential control. That status quo—rooted in the Supreme Court’s 1935 decision in Humphrey’s Executor v. United States—is on the verge of transformation.
This term, the Supreme Court will reconsider Humphrey’s Executor and decide whether Congress may insulate independent agency heads from the president’s control. The practical implications are significant, including increased presidential oversight of regulatory decisions made across independent agencies such as the Federal Reserve System, the Securities and Exchange Commission, the Federal Trade Commission (FTC), the National Labor Relations Board (NLRB), and many others. Depending on how the Supreme Court rules in the pending cases, businesses may have to reassess how they interact with these agencies in the regulatory process.
Humphrey’s Executor and Removal Authority
Although the president has clear constitutional authority to remove executive agency heads (such as the Secretary of State), Congress has long sought to restrict the removal power as it relates to leaders of “independent” boards and commissions—those agencies that Congress has structured to be more insulated from presidential control. To that end, Congress has often imposed “for cause” restrictions on the president’s ability to remove the heads of these independent agencies.2 The Supreme Court validated this approach in Humphrey’s Executor, where it upheld a law that prevented the president from removing FTC members except in cases of “inefficiency, neglect of duty, or malfeasance in office.”3 That decision—which was seen as a check on President Roosevelt—established that Congress could limit the president’s removal authority for independent agencies, which function as quasi-legislative or quasi-judicial bodies.4
Nearly a century later in Seila Law LLC v. CFPB, the Supreme Court refused to extend Humphrey’s Executor to the Consumer Financial Protection Bureau (CFPB), noting that the CFPB’s single director held significant “executive” power, unlike the “New Deal-era” FTC’s “multimember” expert panel.5 The Court also suggested that it might rule differently on Humphrey’s Executor today.6 That shift aligns with the Supreme Court’s growing support for the unitary executive theory—a theory that has been advanced by multiple presidents for many years—under which the president has direct and sole control over the entire executive branch based on Article 2 of the Constitution, which states that “[t]he executive Power shall be vested in a President of the United States of America.”
Legal Challenges to President Trump’s Exercise of Removal Authority
In recent months, President Trump has fired several independent agency heads, directly challenging Congress’s limits on his removal power. The president signaled his position early in his term, when the Justice Department told Congress that it would no longer defend “for-cause” removal rules and would urge the Supreme Court to overrule Humphrey’s Executor. 7
These firings have affected more than a dozen independent agencies, sparking a wave of litigation. Bound by Humphrey’s Executor, lower courts have rejected the firings for violating Congress’s for-cause removal provisions. But given the Supreme Court’s treatment of emergency requests in these cases, many expect the Court to ultimately agree with the president and find that statutory for-cause removal restrictions are unconstitutional.
One key case is a Humphrey’s Executor déjà vu, involving President Trump’s firing of FTC Commissioner Rebecca Slaughter—the same position at issue in the landmark decision. President Trump dismissed Slaughter via an email, citing her service as “inconsistent” with the administration’s priorities.8 Slaughter filed suit, and the district court ordered her reinstatement. The government appealed to the D.C. Circuit, requesting a stay of her reinstatement, but the request was denied.9 The government then asked the Supreme Court for an emergency stay, which the Court granted in a 6-3 ideological split (thus preventing Slaughter’s reinstatement while the case is litigated). The majority provided no explanation, prompting a dissent by Justice Kagan, joined by Justices Sotomayor and Jackson, who warned against using the Court’s emergency docket to “reshape the Nation’s separation of powers” by shifting authority from Congress to the president.
The Supreme Court also took the unusual step of granting certiorari before judgment, allowing the Court to directly review the district court’s decision.10 The Court will hear Slaughter’s case in December 2025, and has directed both sides to address whether Humphrey’s Executor should be overruled. Meanwhile, the Court has blocked the reinstatement of several other officials who are similarly contesting their at-will terminations, including from the Consumer Product Safety Commission (CPSC), Merit Systems Protection Board, and the NLRB.11
The Supreme Court took a slightly different tack for the president’s for-cause removal of Lisa Cook from the Federal Reserve Board, declining to immediately grant the government’s request to remove her during litigation. Instead, Cook remains in office, with arguments on the government’s stay request scheduled for January 2026.12 The difference in approach could suggest that the Court’s reconsideration of Humphrey’s Executor will impact independent agencies differently, depending on each agency’s composition and functions. Even if some for-cause protections are deemed constitutional, thorny questions will remain about the scope of review and deference granted to the president in making requisite findings for removal.
What Lies Ahead for Independent Agencies and Those They Regulate
Stakeholders in government and industry are closely watching, with many expecting the Supreme Court to use the Slaughter and Cook cases to redefine the president’s authority over independent agencies. As shown in the Quick Guide to Independent Regulatory Agencies, there are dozens of independent agencies that currently enjoy for-cause and other congressional protections. The future of these protections (and potentially the very structure of these agencies) is uncertain. If Humphrey’s Executor is overturned, these agencies may be brought under direct presidential control. Treating more of these independent agencies like traditional executive agencies could lead to: (1) rapid policy swings, as regulatory priorities shift with each new administration; (2) enforcement volatility tied to current political trends; and (3) greater external influence on agency decision-making. But with such shifts may also come increased accountability to voters and the political process.
Many businesses are directly regulated by independent agencies such as the CPSC, the Equal Employment Opportunity Commission, the FTC, the NLRB, the Surface Transportation Board, and several others.13 The manner in which these agencies regulate industry could dramatically change, depending on whether the Supreme Court overrules Humphrey’s Executor and which agencies are affected by the Court’s new approach to the president’s removal authority. As a result, businesses may have opportunities to advocate more directly for their regulatory prerogatives.
Footnotes
1 See US Policy and Regulatory Alert, Trump Administration Asserts Control Over Independent Agencies.
2 See Quick Guide to Independent Regulatory Agencies, which identifies 30 independent agencies and provides a top-line summary of their composition, their statutory for-cause removal protections (if any), and current litigation status.
3 Humphrey’s Executor v. United States, 295 U.S. 602, 619 (1935) (citing 15 U.S.C. § 41).
4 Id. at 631 (“Whether the power of the President to remove an officer shall prevail over the authority of Congress to condition the power by fixing a definite term and precluding a removal except for cause will depend on the character of the office.”)
5 Seila Law LLC v. CFPB, 591 U.S. 207, 218 (2020).
6 Id. at 216 n.2.
7 https://www.justice.gov/oip/media/1389526/dl?inline.
8 Slaughter v. Trump, 2025 WL 1984396 (D.D.C. 2025).
9 Slaughter v. Trump, 2025 WL 2551247 at *1 (D.C. Cir. 2025).
10 Trump v. Slaughter, 2025 WL 2692050 (U.S. Sept. 22, 2025).
11 See supra, Quick Guide.
12 See Miscellaneous Order, https://www.supremecourt.gov/orders/courtorders/100125zr_7648.pdf.
13 These are among the subset of independent agencies whose heads have been fired and are now involved in active litigation. See Quick Guide to Independent Regulatory Agencies.
Quick Guide- Independent Regulatory Agencies
The US Supreme Court will soon decide the fate of Humphrey’s Executor and with it the president’s power to remove the heads of independent agencies. As the legal community awaits this ruling, there has been heightened attention on independent agencies, including their varying leadership structures and removal protections.
Our quick guide to independent regulatory agencies identifies 30 such agencies and provides a top-line summary of their composition, the statutory “for cause” removal protections Congress has put in place for their leaders, and the current status of those protections. This guide is a resource for understanding how the Court’s upcoming decisions in this area may affect the independent agencies that most directly regulate your industry.
View our quick guide here.
California Mandates Easy Social Media Account Deletion
California recently enacted California Assembly Bill 656 (the “Act”), which requires social media platforms to make it easier and more straightforward for users to delete their social media accounts and personal information. The Act applies to social media platforms that generate more than $100 million in annual gross revenues.
Key provisions of the Act include:
Conspicuous Account Deletion Button. Social media platforms must display a clearly visible and accessible account deletion button labeled “Delete Account” in the platform’s settings menu. Once a user clicks the “Delete Account” button, the social media platform must provide the steps necessary to complete the account deletion request, which must also include the deletion of the user’s personal information.
Easy-to-Use Verification Method. The Act specifies that if a social media platform requires verification of the account deletion request (e.g., through two-factor authentication, email, SMS message), such verification must be easy-to-use and cost-effective.
CCPA Deletion Request. An account deletion request must be treated as a request to delete under the California Consumer Privacy Act (CCPA) and processed in accordance with the CCPA’s requirements (e.g., within 45 days, flowed down to service providers).
No Obstruction or Interference. Social media platforms may not use confusing designs, including dark patterns, to obstruct or interfere with users’ ability to delete their accounts and personal information.
Subsequent Login Does Not Revoke the Request. User login after an account deletion request does not revoke or cancel the deletion request.
The Act takes effect on January 1, 2026.
Governor of Oregon Orders Clean Energy Overhaul
Key Takeaways
Oregon Governor Tina Kotek issued Executive Order (EO) 25-29 on November 19, 2025, directing Oregon agencies to fast-track the state’s clean energy transition.
The EO mandates implementation of the Oregon Energy Strategy, orders the streamlining of permitting for renewable energy and energy storage projects, and prioritizes transmission planning to improve grid reliability and affordability. The EO emphasizes infrastructure development, regulatory streamlining, and resilience measures to meet the state’s ambitious climate goals, while also supporting public-private partnerships to explore emerging carbon-free technologies.
Agency work plan updates and stakeholder engagement processes should begin in early 2026. Agency reports and recommendations are due in July and September of the coming year.
With the signing of this order, which follows on the heels of the Washington Clean Energy Siting Council’s 2025 Report, the Pacific Northwest continues to move toward aligning regulatory structures with decarbonization goals.
Summary of Directives
Foster the Transition to a Clean Energy Economy
State agencies are directed to align their decisions and investments with Oregon’s Energy Strategy, focusing on the five least-cost pathways (energy efficiency, clean electricity, electrification, low-carbon fuels, and resilience). Key objectives include advancing energy efficiency across all sectors, accelerating investment in clean electricity infrastructure, increasing electrification of vehicles and buildings, and strengthening the Low-Carbon Fuels Standard to achieve a 50% carbon intensity reduction by 2040. The order also directs the Public Utility Commission to establish criteria to value benefits from utility investments in system resiliency, such as microgrids, storage, and virtual power plants.
Get Clean Energy Projects Built
Agencies are tasked with streamlining land use, environmental reviews, permitting, and interconnection processes for clean energy projects and associated infrastructure. Initiatives include reducing barriers to the development of renewable generation, storage, grid infrastructure, updating land use planning rules, modernizing siting and permitting processes, designating transmission corridors on state and federal lands, and setting a goal of deploying 8 gigawatts of energy storage by 2045. Reports and recommendations to the Energy Facility Siting Council and the Governor are due in the second half of 2026.
Build a Resilient Clean Energy Economy
The Governor’s order also aims to promote economic development and support emerging technologies. Agencies, including the Oregon Departments of Energy and Environmental Quality, must pursue public-private partnerships to support clean energy technologies, evaluate emerging carbon-free technologies, and propose frameworks to overcome risks and barriers. Progress will be reported in biennial energy reports, starting with the December 2026 submission to the legislature. The goal is to attract climate-friendly industries, create jobs, and align with Oregon’s climate objectives.
Pricing Algorithms – Price Tags and Personal and Competitor Data- States Step Up Algorithmic Pricing Regulation
As price-setting by computer algorithm becomes increasingly prevalent, states are stepping in to address transparency and fairness concerns that federal legislation has yet to comprehensively tackle. Lawmakers argue that clear disclosure and limits on algorithmic practices are essential to protect consumers from opaque pricing methods that may leverage their personal data or result from anti-competitive collaboration among businesses. The growing patchwork of state-level initiatives signals a broader trend toward local oversight of algorithmic decision-making in commerce, but the landscape is rapidly changing as lawmakers attempt to catch up to rapidly changing technology.
As they are often at the forefront of these issues, recent legislative and regulatory developments in California and New York are leading the way on regulating the growing technology. In the meantime, federal courts have issued divided decisions dealing with algorithmic pricing.
New York: Algorithmic Pricing Disclosure Act Survives Legal Challenge
In May 2025, New York passed the Algorithmic Pricing Disclosure Act, requiring businesses to inform customers when prices are set using personalized algorithms. The Act broadly applies to entities domiciled or doing business in New York. The Act requires businesses to disclose when a price is set using an algorithm that incorporates personal consumer data by requiring the following disclosure: “THIS PRICE WAS SET BY AN ALGORITHM USING YOUR PERSONAL DATA.” The New York Act is enforced solely by the New York Attorney General, who must first issue a cease-and-desist notice before pursuing penalties of up to $1,000 per violation.
The passage of the New York law marked a significant milestone, as it recently withstood a legal challenge brought by industry groups who argued that the mandated disclosure infringed on commercial free speech and imposed undue burdens on businesses.[1] On October 8, 2025, the court granted New York State’s motion to dismiss, finding the disclosure was factual and uncontroversial and that it served a valid consumer protection interest.
California: Restrains use of Competitor Data to Influence Price
On October 6, 2025, California signed AB 325 into law. AB 325 prohibits agreements to use or distribute a “common pricing algorithm,” defined as any software or other technology that two or more people use which ingests competitor data to recommend, align, stabilize, set, or otherwise influence a price or commercial term (including terms related to both upstream vendors and downstream customers), and lowers the pleading standard under the Cartwright Act (California’s antitrust statute, Cal Bus. & Prof. Code § 16720) for certain civil claims. The law also prohibits coercing another person to set or adopt a recommended price or commercial term generated by such an algorithm for the same or similar products or services in California.
Other Efforts to Regulate Algorithmic Pricing
In 2025 alone, more than 50 bills have been introduced to regulate algorithmic pricing across 24 state legislatures, including the following:
Illinois introduced several bills that, if enacted, would regulate or ban dynamic pricing in selected situations, including ticket sales (HB 3838) or the use of consumer data in pricing (SB2255).
Texas introduced SB 2567, which would require retailers to disclose algorithmic pricing at the point of sale.
Massachusetts introduced House Bill 99 which, if enacted, would ban dynamic pricing based on customers’ biometric data.
Colorado’s legislature passed, but the governor vetoed, HB25-1004, legislation that would have prohibited the sale or distribution of an algorithmic device sold or distributed with the intent to be used by two or more landlords in the same market to set or recommend the amount of rent, level of occupancy, or other commercial terms.
New Jersey introduced SB 3657, which seeks to make it unlawful for landlords or property managers to use algorithmic systems to influence rental prices or housing supply in New Jersey.
Pennsylvania introduced HB 1779, which seeks to require disclosure of algorithmic pricing and prohibits dynamic pricing based on protected class data (e.g., race, gender, religion).
Last week, U.S. Senators Ron Wyden and Peter Welch introduced The End Rent Fixing Act of 2025. The Act is targeted at algorithms that use competitors’ data to set rental rates. The Act would make it unlawful for rental property owners to contract for the services of a company that coordinates rental housing prices and supply information and would designate such arrangements as a per se violation of the U.S. antitrust laws. It would also prohibit the practice of coordinating price, supply, and other rental housing information among two or more rental property owners. The Act would also allow individual plaintiffs to invalidate any pre-dispute arbitration agreement or pre-dispute joint action waiver that would prevent the plaintiff from bringing suit.
Algorithms Using Competitors’ Data to Set Prices
U.S. antitrust law hasn’t fully caught up with how algorithmic price setting, and the legal landscape, is changing fast. Some experts think there could be liability in certain situations. For example, the Department of Justice has argued that if competitors use the same pricing algorithm—and that algorithm relies on competitors sharing their data to set prices—it could violate the Sherman Antitrust Act.
In September 2025, the Ninth Circuit issued the first federal appellate decision on algorithmic pricing in Gibson v. Cendyn Group, ruling that competing Las Vegas hotels did not violate Section 1 of the Sherman Act by independently using the same third-party pricing software, where there was no underlying agreement among competitors and the software did not share confidential information among licensees.
In contrast, in December 2023, an Illinois federal court denied motions to dismiss claims in multi-district class action litigation alleging software vendors and rental property owners and managers conspired by sharing property rental pricing and supply data to fix prices for multi-family house rentals across the country.[2] Last week, the court granted preliminary approval of settlements with 27 defendants for $141.8 million. The litigation continues with the larger defendants whose conduct, the plaintiffs contend, comprised the larger volume of the alleged illegal commerce at issue in the case.
In June 2025, an Illinois federal court denied a motion to dismiss allegations that health insurers unlawfully conspired to underpay out-of-network providers by outsourcing rate-setting to analytics firm MultiPlan. The court applied the per se standard, finding plaintiffs “plausibly alleged a horizontal hub-and-spokes price-fixing agreement.”
Conclusion
The legislative developments and growing litigation over the legality of dynamic pricing tools reflect growing concern among policymakers about the fairness and transparency of algorithmic pricing models. As states continue to debate and refine proposed laws, businesses that rely on dynamic pricing must closely monitor these changes and proactively assess their compliance obligations. Staying informed about both state and federal actions will be essential to avoid potential legal pitfalls and ensure responsible use of pricing algorithms.
Our team is available to assist with legal reviews, compliance strategies, and AI governance planning. If you have questions about how statutes, regulations, or court rulings impact you or your business, contact your Miller Canfield attorney or one of the authors of this alert.
[1] National Retail Federation v. James, 1:25-cv-05500-JSR
[2] In Re: RealPage, Inc., Rental Software Antitrust Litigation, Case No. 3:23-md-3071, MDL No. 3071.
2026 Minimum Wage Increases in New York: Key Details for Employers
The minimum wage in New York State is set to increase to $17.00 in New York City, Long Island, and Westchester County and to $16.00 for employees in the rest of the state, beginning January 1, 2026, along with several other wage credit adjustments affecting employers.
Quick Hits
Effective January 1, 2026, New York State will raise the minimum wage to $17.00 for downstate employees and $16.00 for upstate employees
Along with the minimum wage increases, there will be adjustments to the cash wage and tip credits for tipped service employees, as well as revised meal and uniform credit rates to reflect the new wage structure.
The minimum salary thresholds for the executive and administrative employee minimum wage exemption are also set to increase for both downstate and upstate employees.
Minimum Wage Increase
New York has separate minimum wage rates for employees in downstate New York, which encompasses New York City, Long Island (Nassau and Suffolk Counties), and Westchester County, and for employees in upstate New York (the remainder of the state). The hourly minimum wage rates for both downstate and upstate and employees will increase by $0.50 per hour in 2026.
Effective January 1, 2026, the rate for downstate employees will increase to $17.00 per hour from $16.50 per hour, and for upstate employees, it will increase to $16.00 per hour from $15.50 per hour. Along with the minimum wage rate increases, there will be adjustments to the minimum cash wage for tipped service employees and the employer tip credits.
New York City, Long Island (Nassau and Suffolk Counties), and Westchester County
Current Rate
Effective January 1, 2025
Minimum Wage
$16.50
$17.00
Overtime (plus one half)
$24.75
$25.50
Fast Food Workers
$16.50
$17.00
Cash Wage for Tipped Food Service Workers
$11.00
$11.35
Tip Credit for Food Service Workers
$5.50
$5.65
Cash Wage for Tipped Service Workers
$13.75
$14.15
Tip Credit for Tipped Service Workers
$2.75
$2.85
Remainder of New York State
Current Rate
Effective January 1, 2025
Minimum Wage
$15.50
$16.00
Overtime
$23.50
$24.00
Minimum Wage for Fast Food Workers
$15.50
$16.00
Cash Wage for Tipped Service Workers
$10.35
$10.70
Tip Credit
$5.15
$5.30
Cash Wage for Tipped Service Workers
$12.90
$13.30
Tip Credit for Tipped Service Workers
$2.60
$2.70
After 2026, the minimum wage will adjust for inflation based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Northeast Region. Since January 1, 2024, the minimum wage rate for non-tipped fast food workers at chain restaurants (those with more than thirty locations nationally) has been the same as that of other non-tipped workers.
Meal Credit Adjustments
New York law allows employers to take a credit for meals provided to employees as part of employees’ wages valued up to specific rates. However, according to the New York Hospitality Industry Wage Order issued by the New York Department of Labor (NYDOL), the meals must meet strict requirements to qualify for the wage credit.
Meals must be furnished to employees at times when they customarily eat. Further, meals must include at least one type of food from four categories: “(1) fruits or vegetables; (2) grains or potatoes; (3) eggs, meat, fish, poultry, dairy, or legumes; and (4) tea, coffee, milk or juice.”
New York City, Long Island (Nassau and Suffolk Counties), and Westchester County
Current Rate (Per Week)
Effective January 1, 2025 (Per Week)
Restaurants and Hotels
Food Service Workers
$3.95
$4.05
Service employees
$4.60
$4.75
All Others
$5.65
$5.80
Resort Hotels
Food Service Workers
$4.35
$4.50
Service Employees
$5.95
$6.15
All Others
$7.45
$7.70
Remainder of New York State
Current Rate (Per Week)
Effective January 1, 2025 (Per Week)
Restaurants and Hotels
Food Service Workers
$3.95
$4.10
Service employees
$4.25
$4.40
All Others
$5.35
$5.50
Resort Hotels
Food Service Workers
$4.25
$4.40
Service Employees
$5.60
$5.80
All Others
$7.00
$7.25
Uniform Credit Adjustments
New York law provides that where an employer “does not maintain required uniforms for any employee, the employer shall pay the employee” a rate in addition to the employee’s regular rate of pay to cover washing, ironing, dry cleaning, or repair of mandatory uniforms. The weekly rate increases with the number of hours worked. Employees who work more than thirty hours are paid the “High rate,” those who work more than twenty but up to thirty hours are paid the “Medium rate,” and those who work twenty hours or less are paid the “Low rate.”
Employers are not required to make uniform maintenance payments if the required uniforms are “(1) are made of ‘wash and wear’ materials; (2) may be routinely washed and dried with other personal garments; (3) do not require ironing, dry cleaning, daily washing, commercial laundering, or other special treatment; and (4) are furnished to the employee in sufficient number, or the employee is reimbursed by the employer for the purchase of a sufficient number of uniforms, consistent with the average number of days per week worked by the employee.” Employers are also not required to pay for uniform maintenance if the employee “chooses not to use the employer’s service.”
New York City, Long Island (Nassau and Suffolk Counties), and Westchester County
Current Rate (Per Week)
Effective January 1, 2025 (Per Week)
Uniform Allowances (20 or fewer hours per week)
$9.80
$10.10
Uniform Allowances (more than 20 to up to 30 hours per week)
$16.25
$16.75
Uniform Allowances (over 30 hours per week)
$20.50
$21.10
Remainder of New York State
Current Rate (Per Week)
Effective January 1, 2025 (Per Week)
Uniform Allowances (20 or fewer hours per week)
$9.25
$9.55
Uniform Allowances (20 to 30 hours per week)
$15.30
$15.80
Uniform Allowances (over 30 hours per week)
$19.25
$19.85
Executive and Administrative Salary Exemption
Employees who work in an “[e]xecutive” or “administrative” capacity and who are paid a “salary” not less than the thresholds set by state regulations may be exempt from the state’s overtime pay requirements. The thresholds are again set to increase for both downstate and upstate employees, under a three-year increase set by the New York Department of Labor.
Effective January 1, the thresholds will increase:
New York City, Long Island (Nassau and Suffolk Counties), and Westchester County
$1,275.00 ($66,300 per year), up from the current $1,237.50 per week
Remainder of New York State
$1,199.10 per week ($62,353.20 per year), up from $1,161.65 per week
New York law also makes employees who “[w]ork in a bona fide … professional capacity” (ellipsis in original) overtime exempt if they meet the specific requirements. However, those requirements do not include specific salary thresholds for individuals, such as those working in an executive or administrative capacity. While there is no minimum salary threshold under New York for the profession exemption, the salary minimums under the Fair Labor Standards Act (FLSA) apply. The federal minimum for exempt professional employees under FLSA is $684 per week or $35,568 per year. That minimum has remained flat since 2019 as a U.S. Department of Labor (DOL) rule that had planned increases was struck down in court in November 2024.
Next Steps
Employers across New York State may want to take steps to prepare for these upcoming increases. Importantly, while the 2026 minimum wage increase marks the end of three years of set annual increases, the minimum wage rate will be indexed to inflation, with adjustments based on the CPI-W for the Northeast Region. The NYDOL reminded employers that minimum wage theft is considered a crime under New York State penal law and could result in prosecution.
State Privacy Action Grows- Consortium Expands, California Launches Data Broker Strike Force
The Consortium of Privacy Regulators is growing. Meanwhile, CalPrivacy has announced a new program, a data broker “strike force.”
Minnesota and New Hampshire have joined with Colorado, Connecticut, Delaware, Indiana, New Jersey, Oregon, and the California Privacy regulatory body (CalPrivacy) to coordinate on their enforcement of “comprehensive” privacy laws. The consortium was created earlier this year, with the stated goal of coordinating privacy law enforcement efforts. Since the consortium was created, California, Colorado and Connecticut joined together in September to investigate companies’ alleged failure to honor sale opt-out requests and honor GPC signals.
Meanwhile, CalPrivacy announced that it will increase its oversight of data brokers. It has created a special team called the Data Broker Enforcement Strike Force. This team will ensure that companies are following rules about protecting consumer privacy and registering as data brokers. The strike force will have more resources to investigate violations. The strike force creation follows recent actions brought by the agency under California’s Delete Act.
Putting it into Practice: The state-level actions are a reminder to those operating in the US. As we enter into 2026, expect more state level coordination and enforcement. This is a good time to assess if your privacy program takes an adaptive and principles-based approach. Do your training efforts go beyond memorization? Do you reward “small wins” and otherwise take an organizational change lens to your compliance efforts?
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The Lobby Shop- Washington Reopens- The Fallout, the Politics, and What Happens Next [Podcast]
With the federal government reopened, Lobby Shop hosts Josh Zive, Paul Nathanson and Liam Donovan break down the political fallout and how both parties are repositioning. They then turn to the Virginia and New Jersey election results and what they signal for the 2026 midterms, assess ongoing redistricting battles and discuss how the economy—including inflation and tariff policy—may shape voter sentiment.
Ninth Circuit Partially Pauses Enforcement as CARB Attempts to Clarify Disclosure Laws
In September, we provided a Bracewell Update discussing the California Air Resources Board’s (CARB’s) Preliminary List of Reporting/Covered Entities relating to the state’s climate disclosure laws—the California Corporate Greenhouse Gas Reporting Program (SB 253) and the Climate Related Financial Risk Disclosure Program (SB 261). As detailed in our prior article, SB 253 requires US companies with total annual revenues in excess of $1 billion that do business in California to annually disclose their scope 1, 2 and 3 greenhouse gas (GHG) emissions for the prior fiscal year. SB 261 requires US companies with total annual revenues exceeding $500 million that do business in California to publish biennial climate-related financial risk reports.
On Tuesday, November 18, 2025, CARB hosted a third public workshop to address comments received regarding applicability, deadlines, reporting requirements and other topics ahead of the upcoming initial reporting deadlines. The same day, the Ninth Circuit enjoined enforcement of the SB 261 Climate Related Financial Risk Disclosure requirements pending an appeal of a challenge to those requirements.[1] The Court did not enjoin enforcement of the SB 253 requirements.
Ninth Circuit Order Pauses SB 261 Enforcement
The US Chamber of Commerce and other business groups challenged both SB 253 and SB 261 in January 2024, arguing that both laws violated the First Amendment.[2] The District Court denied plaintiffs’ request for preliminary injunction,[3] and plaintiffs appealed the denial to the Ninth Circuit and requested an injunction pending appeal. Without providing any reasoning, the Ninth Circuit granted the injunction request for SB 261 and denied the request for SB 253.[4] This means California may not enforce the requirements of the Climate Related Financial Risk Disclosure Program until the Court has made a ruling on appeal. Oral argument is currently scheduled for January 9, 2026, after the initial SB 261 reports are due on January 1. During the public workshop, CARB staff indicated they were still reviewing the order and provided the guidance discussed below. Bracewell will continue to monitor for litigation updates and additional guidance published by CARB that takes this decision into account.
CARB Changes Direction on “Doing Business in California”
CARB acknowledged significant shortcomings during the public workshop related to its published list of reporting/covered entities. CARB’s acknowledgements included recognizing that the California Secretary of State database fails to include revenue and may include incomplete or outdated data, and that several major companies are missing from the database list that CARB believes meet the eligibility thresholds for SB 261 and SB 253. In turn, CARB emphasized that the list should not be used as a compliance tool and reiterated that “[e]ach potentially regulated entity remains responsible for compliance.”[5]
CARB stated that it is turning back to the California Revenue and Tax Code (“RTC”) for defining “doing business in California” and “revenue” for purposes of applicability. In doing so, CARB explained that corporate tax filings contain the most up-to-date data. Accordingly, CARB has proposed the following definition of “doing business in California” in accordance with RTC § 23101 (but omitting § 23101 (b)(3)-(4) related to property holdings and payroll):
Actively engaging in any transaction for the purpose of financial gain or profit and any of the following conditions is met during any part of a reporting year:
The entity is organized or commercially domiciled in this state;
Sales, as defined in The Revenue and Taxation Code subdivision (e) or (f) of Section 25120 as applicable for the reporting year, of the entity in this state exceed the inflation adjusted thresholds of seven hundred thirty-five thousand and nineteen ($735,019) (2024). For purposes of this paragraph, sales of the entity include sales by an agent or independent contractor of the entity. For purposes of this paragraph, sales in this state shall be determined using the rules for assigning sales under Sections 25135 and 25136, and the regulations thereunder, as modified by regulations under Section 25137.
CARB stated that if a company files tax returns with the California Franchise Tax Board, then it “automatically” meets the above requirements provided in the definition of “doing business in California” for the purposes of SB 253 and 261.[6] Further, CARB maintains that it will utilize the RTC definition of “gross receipts” at RTC § 25120(f)(2) for defining “revenue” for purposes of SB 261 and SB 253 because gross receipts is verifiable on FTB tax filings. Accordingly, “revenue” is proposed to mean:
The gross amounts realized (the sum of money and the fair market value of other property or services received) on the sale or exchange of property, the performance of services, or the use of property or capital (including rents, royalties, interest, and dividends) in a transaction that produces business income, in which the income, gain, or loss is recognized (or would be recognized if the transaction were in the United States) under the Internal Revenue Code, as applicable for purposes of this part. Amounts realized on the sale or exchange of property shall not be reduced by the cost of goods sold or the basis of property sold.
CARB noted that “applicability would be determined by the lesser of the entity’s two previous fiscal years of revenue” in order “[t]o account for annual changes in revenue.”[7]
CARB Clarifies that Parent and Subsidiaries Determine Applicability Separately
Recognizing the many comments received regarding parent-subsidiary relationships, CARB clarified that “[i]nclusion criteria should be assessed on an individual company basis.”[8] While a parent company may report on behalf of its subsidiary, the parent-subsidiary relationships do not determine which entities are regulated. It is possible that a subsidiary could be subject to reporting requirements while a parent company is not, and vice versa.
Deadlines and Guidance for SB 261 Reporting Requirements
Deadlines. CARB maintained that reports should be posted to entities’ websites and links to reports on the CARB docket by January 1, 2026. CARB stated that the docket will open December 1, 2025 so that entities can meet the January 1 deadline. CARB may issue further guidance regarding deadlines in light of the Ninth Circuit decision.
Reporting Frameworks: CARB continued to state that companies may use one of several frameworks, including TCFD Final Report of Recommendations from 2017 or later versions, International Financial Reporting Standards (IFRS) Disclosure Schedules, or any “report developed in accordance with a regulated exchange, national government, or other governmental entity.”[9]
Requirements: CARB has not updated the draft checklist posted on September 2, 2025 and discussed in our last update. Reporting entities are expected to use “best efforts” in complying with the checklist, including providing the best available data, explaining their process, and identifying any gaps in data, key assumptions, and difficulties faced in generating reports. Additionally, CARB expects that each report should: “contain a statement on which reporting framework is being applied; discuss which recommendations and disclosures have been compiled and which have not; and provide a short summary of the reasons why recommendations/disclosures have not been included as well as discussion of any plans for future disclosures.”[10]
Deadlines and Guidance for SB 253 Reporting Requirements
Deadlines: CARB has pushed back anticipated deadlines for reporting Scope 1 and Scope 2 emissions to August 10, 2026. Reporting Scope 3 emissions data will not be required until at least 2027.
Reporting Templates: CARB published a template for Scope 1 and 2 emissions on October 10, but CARB stated that use of the template is optional for initial 2026 reporting. If companies already generate reports that cover Scope 1 and 2 emissions, then CARB is allowing submittal of those reports.
Requirements: If the reporting entity’s fiscal year ends between January 1st and February 1st, 2026, then the entity will report data from the fiscal year ending in 2026. However, if the reporting entity’s fiscal year ends between February 2nd and December 31st, 2026, then the reporting entity will report data from the fiscal year ending in 2025.[11] In any event, CARB intends to give each reporting entity at least six months after end of their fiscal year to submit their report.
CARB maintained that if companies were not collecting data in December 2024, when CARB’s Enforcement Notice was issued, they are not required to submit Scope 1 and 2 reports but must submit a statement on company letterhead indicating that they were not collecting data at the time the notice was issued.[12] Additionally, CARB confirmed that data assurance is not required for 2026 reporting.
CARB Continues to Welcome Public Comment
While the comment period for CARB’s Draft Reporting Template for Scope 1 and Scope 2 GHG Emissions closed on October 27, 2025, CARB indicated they are still welcoming and evaluating stakeholder feedback to inform subsequent rulemaking for SB 253 and SB 261 to take place in Q1 2026. Additionally, CARB has invited feedback on Scope 3 reporting categories.
CARB indicated that the public comment period will be open for the 45-day comment period upon publication of the notice package for the initial rulemaking.
Lily Walton contributed to this article
[1] US Chamber of Com., et al. v. Randolph, No. 25-5327 (9th Cir. Nov. 18, 2025) (order granting injunction pending appeal in part).
[2] See Complaint for Declaratory and Injunctive Relief, US Chamber of Com., et al. v. Randolph, No. 2:24-cv-00801 (C.D. Cal. Jan. 30, 2024).
[3] See US Chamber of Com., et al. v. Randolph, No. 2:24-cv-00801-ODW (PVCx) (C.D. Cal. Sept. 11, 2025) (order denying plaintiffs’ motion for preliminary injunction).
[4] US Chamber of Com., No. 25-5327.
[5] CARB, SB 253/261/219 Public Workshop: Update on California Corporate Greenhouse Gas Reporting and Climate-Relate Financial Risk Disclosure Programs (Nov. 18, 2025) at 18 (available at https://ww2.arb.ca.gov/sites/default/files/classic/SB%20253%20261%20Nov%20Workshop%20slides_v2.pdf) (“Public Workshop Presentation”).
[6] Public Workshop Presentation at 21.
[7] Id. at 23.
[8] Id. at 28.
[9]Id. at 35.
[10] Id. at 36.
[11] Id. at 11.
[12] Id. at 12.
Illinois Overhauls County Siting Process for Renewable Energy and Energy Storage Projects: Seven Key Takeaways
On October 30, the Illinois General Assembly passed the Clean and Reliable Grid Affordability Act (CRGA). CRGA makes significant updates to Illinois’ current statewide siting and zoning framework for renewable energy projects and creates a statewide standard for energy storage projects.
In 2023, Illinois enacted statewide standards for counties regulating commercial wind and solar energy projects, and counties may not impose conditions more restrictive than these standards. (We covered that law here.) CRGA updates these standards, and we summarize key changes below. Governor JB Pritzker has pledged to sign CRGA into law.
County Permit Fees Must Be Reasonable
The Act imposes a new “reasonableness” requirement for siting and building permit application fees and limits the number of building permits to one per project. For wind and solar energy projects, siting fees at or below $5,000 per megawatt (MW), up to $125,000, and building permit fees at or below $5,000 per MW, up to $75,000, are presumed reasonable.
For energy storage projects, siting and building permit fees each cannot exceed $5,000 per MW, up to $50,000.
In addition to reasonable permit fees, counties may recover documented, reasonable permit processing costs in excess of the maximum permit fee.
Road Use Agreement Fees Must Be Tied Actual Costs
The Act limits road use agreement fees between local governments and developers of commercial wind, solar, or energy storage facilities. Any fees, fines, or payments in an agreement are limited to a local government’s actual costs negotiating and administering the agreement and constructing any necessary road work. Local governments can only require developers to pay for roadwork that is specifically needed to construct the wind, solar, or energy storage project and restore the roads once project construction is complete.
Counties Must Conduct Public Hearings on an Accelerated Schedule
Under CRGA, public hearings for solar, storage, or wind project siting must now begin and end within 60 days after the developer files its application. This is a significant change from recent years. Some county siting hearings have continued for upwards of six or more months. The county must issue its decision within 30 days after the hearing concludes.
Project Developers Have a Longer Period to Obtain Building Permits
The Act provides that county siting permits for commercial solar energy or wind projects cannot impose a deadline to start construction or obtain a building permit sooner than five years from the date of permit issuance. The Act further allows developers to request an extension of the deadline based on reasonable cause.
For energy storage projects, the deadline to start construction or obtain a building permit must be at least three years from the date of permit issuance, and developers may request an extension based on reasonable cause.
Counties Have Zoning Jurisdiction Over Solar Energy Projects in Unincorporated Areas
The Act clarifies county authority to permit commercial solar projects relative to municipal zoning jurisdiction. For solar energy projects, the Act clarifies that, whether a county is zoned or unzoned, a county’s solar regulation applies in all unincorporated areas outside a municipality’s corporate boundaries (municipal regulation applies inside municipal boundaries). By comparison, municipalities may regulate wind energy projects within their boundaries and within a 1.5-mile zone surrounding their boundaries, often referred to as a municipality’s extraterritorial jurisdiction for wind energy projects.
Limits on Vegetative Screening
The Act limits a county’s ability to specify the type of vegetative screening required between commercial solar energy facilities and nonparticipating residences. Screening requirements must be commercially reasonable – though commercially reasonable is not defined – and height‑limited to avoid interference with solar output.
Energy Storage Siting Standards
CGRA also puts forth county siting standards for stand-alone energy storage projects similar to the statewide standards for commercial wind and solar energy projects. These standards apply to storage systems larger than 1,000 kilowatts (1 MW) that do not use combustion to store energy (for example, battery storage systems) and are not co-located with wind or solar energy assets. Only counties that have enacted zoning ordinances may apply these standards, and only in unincorporated areas outside any municipality’s corporate boundary.
Safety Baseline: Counties may require compliance with the National Fire Protection Association Standard 855, titled “Standard for the Installation of Stationary Energy Storage Systems,” but may not set more stringent standards.
Hearings: Counties must hold at least one public hearing before granting an energy storage project’s siting approval. Hearings must be completed within 60 days of the application filing and the county must issue its decision within 30 days after the hearing concludes.
Physical Siting Requirements: If a county enacts an energy storage system siting ordinance, it must include the following physical siting requirements, without alternation.
Setbacks: At least 150 feet from the nearest wall of any occupied community building or nonparticipating residence, 50 feet from nonparticipating property lines, and 50 feet from public road rights‑of‑way. A nonparticipating property owner may provide written consent to waive an applicable setback.
Fencing: Perimeter fencing must be at least seven feet and no more than 25 feet high.
Noise: Counties may not set noise limits more restrictive than Illinois Pollution Control Board standards. After operations begin, a county may require a one‑time, reasonable perimeter sound test to demonstrate the facility’s compliance.
Decommissioning: Counties may require decommissioning plans that include removal of obsolete or abandoned structures, restoration of soils and vegetation, and reuse or recycling of equipment and components. Counties may also require financial assurance equal to the estimated decommissioning cost, less salvage value, to be provided in certain increments over the first 10 years of the facility’s operation.
Grandfathering: Applications submitted before CRGA’s effective date are not subject to these energy storage siting standards.
Additional research and writing from Hee Soo Jung, a law clerk in ArentFox Schiff’s Chicago office.
California AB 1415: Expanded Oversight for Private Equity and Hedge Fund Investors in Healthcare Deals
Go-To Guide:
California’s AB 1415 expands the scope of entities required to submit advance notice to the Office of Health Care Affordability (OHCA) in advance of a proposed agreement or transaction.
The new law requires private equity, hedge fund investors, and management service organizations (MSOs), and other “noticing entities” to notify OHCA 90 days prior to any proposed agreement or transaction.
AB 1415 defines “noticing entity” as a (i) private equity group or hedge fund, (ii) newly created business entity created for the purpose of entering into agreements or transactions with a health care entity, (iii) management services organization, or (iv) an entity that owns, operates, or controls a provider, regardless of whether the provider is currently operating, providing health care services, or has a pending or suspended license.” See, Cal. Health & Safety Code Section 127507(h).
It is unclear whether monetary thresholds for a material change transaction pursuant to existing law will extend to noticing entities in the forthcoming regulations.
Existing law requires health care entities that meet specified revenue thresholds, among other requirements, to provide notice to OHCA at least 90 days prior to the closing date to allow OHCA to review the transaction and determine whether such transaction will be further evaluated under a “cost and market impact review” (CMIR). “Health care entities” are defined as payors, providers such as hospitals, physician organizations, clinics, ambulatory surgery centers, laboratories, and imaging facilities, fully integrated delivery systems, pharmacy benefit managers (PBMs), including parent, subsidiary, or affiliated entities that act on behalf of a payer.
A “material change transaction” is defined as a merger, acquisition, corporate affiliation, or agreement that involves a transfer of assets or control that would affect the provision of health care services in California and transactions that meet specified materiality thresholds. A material change transaction does not include transactions that occur in the ordinary course of business, such as corporate restructuring – if the health care entity already directly or indirectly through intermediary entity controls – is controlled by or under common control with all parties to the transaction.
I.
A health care entity that is a party to (as buyer, seller, or both), or subject of, a material change transaction that meets at least one element in Section I and at least one element in Section II must file a pre-transaction notice with OHCA if:
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It has annual revenue of at least $25 million or owns or controls California assets of at least $25 million;
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It has annual revenue of at least $10 million or owns or controls California assets of at least $10 million, and is a party to or subject of a transaction with:
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any health care entity that has annual revenue of at least $25 million or owns or controls California assets of at least $25 million, or
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any entity that owns or controls a health care entity that has annual revenue of at least $25 million or owns or controls California assets of at least $25 million.
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It is a provider or fully integrated delivery system that provides health care services in a designated primary care health professional shortage area (HPSA) in California.
Notably, health care entities such as affiliates or subsidiaries that are not listed as parties to the purchase agreement may still be deemed “subject of” a material change transaction if, as a result of the transaction, their assets, governance, responsibility, or operational control will be transferred.
II.
A health care entity (buyer, seller, or both) meets the criteria for a material transaction if it meets any one of the elements in Section I and any one of the elements listed below:
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The proposed fair market value of the transaction is $25 million or more, and the transaction is for the provision of health care services;
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The transaction is more likely than not to increase annual California-derived revenue of any health care entity that is a party to or subject to the transaction by either $10 million or more or 20% or more of the annual California-derived revenue;
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The transaction involves the sale, transfer, lease, exchange, option, encumbrance, or other disposition of 25% or more of the total California assets of the submitter entity;
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The transaction involves the transfer of control, responsibility, or governance in whole or in part of the submitter entity;
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The transaction will result in an entity contracting with payers on behalf of consolidated or combined providers and is more likely than not to increase annual California-derived revenue of any provider in the transaction by either $10 million or more or 20% or more of annual California-derived revenue;
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The transaction involves the formation of a new health care entity, affiliation, partnership, joint venture, or parent corporation for purposes of providing health care services in California and it is projected to have at least $25 million in annual California-derived revenue or the transfer or control of California assets related to such health care services valued at $25 million or more;
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The transaction is part of a series of related transactions for the same or related health care services (otherwise known as a Roll up) occurring over the past 10 years involving the same health care entities or affiliated entities and those combined transactions comprise a single transaction for purposes of determining revenue thresholds, including asset and control circumstances; or
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The transaction involves the acquisition of a health care entity by another entity, and the acquiring entity has consummated similar transactions in the past 10 years with a health care entity that provides the same or related health care services and the proposed transaction plus the prior similar transactions will be treated as a single transaction for determining revenue thresholds, including asset and control circumstances.
AB 1415 (Bonta) amends the California Health & Safety Code §§127500 et seq. to broaden definitions for entities subject to the OHCA pre-transaction notice obligations. Effective Jan. 1, 2026, management service organizations, private equity, hedge fund managers, any newly created business entities created for the purpose of entering into agreements or transactions with a health care entity (otherwise known as NewCos), and an entity that “owns, operates, or controls a provider, regardless of whether the provider is currently operating, providing health care services, or has a pending or suspended license” defined as “noticing entities” must provide written notice to OHCA regarding proposed agreements or transactions between:
1.
A noticing entity and a health care entity;
2.
A noticing entity and MSO; or
3.
A noticing entity and an entity that owns or controls the health care entity or MSO.
OHCA is expected to issue a notice of proposed rulemaking that will provide additional guidance for management service organizations, including clarifying regulations intended to prevent duplicative notice filings. It remains unclear, however, whether the forthcoming regulations will address monetary thresholds for determining a “material change transaction” under existing law, and whether those thresholds will extend to noticing entities.
Gov. Newsom vetoed a similar bill introduced last year, AB 3129 (Wood). In his veto message, Newsom wrote, “However, OHCA was created as the responsible state entity to review proposed health care transactions, and it would be more appropriate for the OHCA to oversee these consolidation issues as it is already doing much of this work.” Unlike AB 1415 (Bonta) pre-transaction notice requirement, AB 3129 (Wood) would have mandated a pre-consent process for private equity backed healthcare transactions.
There is an upward trend across the country towards greater oversight of private equity investments in the healthcare industry. In a press statement, Assemblymember Mia Bonta revealed her perspective on private equity investments in healthcare: “Research shows that as market consolidation rises, so do prices. Over the past decade, hospital mergers have steadily increased, often leading to service reductions or closures as profits are prioritized over community needs.”
Gov. Newsom additionally signed SB 351 (Cabaldon), which codifies the corporate practice of medicine and authorizes the California attorney general to enforce the corporate bar against private equity groups or hedge funds that interfere with the professional clinical judgment of physicians or dentists. The new statute additionally prohibits certain clauses in practice management contracts that would (i) limit provider competition with the practice in the event of termination or resignation, or (ii) disparaging, opining, or commenting on the practice on any issues relating to quality of care, utilization, ethical, or professional challenges in the practice of medicine, dentistry, or revenue-increasing strategies used by the private equity group or hedge fund. Together with the forthcoming OHCA regulations, SB 351 underscores the importance for investors and health care organizations to review existing arrangements to ensure alignment with state law requirements.
Additional states with proposed legislation include states like Massachusetts1, Illinois2, and Pennsylvania3.
Outstanding Issues
This bill adds to the growing patchwork of state laws that may differ from federal regulations.
It is unclear whether a noticing entity’s internal corporate restructuring would fall under the purview of AB 1415.
What constitutes “material amount of assets or operations” in a proposed transaction remains unclear.
Considerations
Private equity and hedge fund investors may wish to:
Proactively assess whether their active or proposed transaction falls within the parameters of AB 1415 and adjust timelines accordingly;
Actively review MSO/PC arrangements and harmonize with new laws; and
Monitor and consider engaging in OHCA regulatory rulemaking process (proposed regulations forthcoming).
1 See, S.868.
2 See, SB 1998.3 See, HB 1460.
In Search of: IEEPA Tariff Refunds
Highlights
The U.S. Supreme Court is expected to rule on the legality of the International Emergency Economic Powers Act (IEEPA) tariff actions in late 2025 or early 2026.
Importers should begin to prepare for potential tariff refunds by tracking protest filing deadlines and by filing timely protests with U.S. Customs and Border Protection (CBP).
The courts could also establish a special IEEPA refund process that may require certain filings or complaints in court.
As the U.S. Supreme Court reviews the lawsuits challenging President Donald Trump’s IEEPA fentanyl and reciprocal tariffs, U.S. importers should take steps now to preserve their legal right to recover IEEPA duties paid if the Supreme Court rules that the tariffs are invalid.
In August 2025, the U.S. Court of Appeals for the Federal Circuit affirmed the U.S. Court of International Trade’s (CIT) earlier decision that President Trump’s IEEPA tariffs were illegal. The Department of Justice appealed the Court of Appeals’ decision to the Supreme Court, which heard arguments on Nov. 5. A final decision is expected in late 2025 or early 2026.
If the Supreme Court agrees with the lower courts and rules that the IEEPA tariffs are illegal, the IEEPA tariffs would be revoked and U.S. importers could be eligible for refunds of IEEPA tariffs paid since February 2025. However, refunds are not automatic under U.S. Customs law, and the Supreme Court’s decision may not directly address how refunds should work. Consequently, importers should start preparing now in case the Supreme Court’s ruling opens the door for recovering IEEPA tariff payments.
IEEPA Tariff Refund Process
At this point, it is unclear what refund process would apply or whether refunds will be handled by the courts or by CBP.
The courts could create a special refund process that requires new filings or complaints. Alternatively, the courts could tell importers to use the normal CBP process, which has strict deadlines. Specifically, importers may be required either to: (one) file post-summary corrections of “unliquidated” entries, or (two) file protests for “liquidated” entries within 180 days of liquidation. “Liquidation” is CBP’s final calculation of duties owed, which usually occurs approximately 314 days after entry but can happen sooner.
To prepare for the possibility of refunds, importers should closely track the liquidation status of all entries for which they paid IEEPA tariffs. Knowing whether each entry is still unliquidated or already liquidated is now critical.
Once an entry liquidates, the importer must file a formal protest within 180 days to protect the right to a refund. The 180-day deadline is a strict statutory deadline. If the deadline passes, the importer permanently loses the ability to recover the tariffs for that entry. No extension of the 180 days is possible.
Finally, in addition to monitoring liquidation status, importers should begin gathering the records they will need if refunds become available. This includes:
Pulling all import data from ACE (Automated Commercial Environment), the online CBP system that stores entry information and duty payment records, for every entry that paid IEEPA duties.
Gathering complete entry packets for all affected entries and proof of duty payments.
For entries that have already been liquidated and are within the 180-day window, importers can file protests even before the Supreme Court decision is issued and can supplement the protests after the decision.
Besides filing protests with CBP post-liquidation, importers may consider filing an appeal in federal court for refunds of IEEPA tariffs collected. However, questions still remain as to the appropriate venue and jurisdiction for such appeals. Notably, the CIT held that it has exclusive jurisdiction to hear claims challenging the IEEPA tariffs under Section 1581(i) of Title 28, the court’s “residual jurisdiction.”
This ruling was subsequently upheld by the Court of Appeals for the Federal Circuit. Nonetheless, arguments made at the Supreme Court may impact the jurisdictional question as some parties challenged whether IEEPA grants the President the authority to implement tariffs altogether — an issue which could impact whether the CIT’s exclusive jurisdiction is appropriate.