In this episode of S&C’s Critical Insights, Eric Kadel and Andrew DeFilippis, Co-Heads of S&C’s Tariffs Response Team, and associate Michael Loughlin discuss recent developments in tariffs, including the Supreme Court’s decision in Learning Resources, considerations surrounding tariff refunds and the emerging market for refunds.
A preview of the conversation is below.
Michael: There is a lot of uncertainty over refunds, even though there's a ton of money at stake. Eric, I understand a market has developed for these claims and refund proceeds. Could you talk about that and what we're seeing?
Eric: Essentially what you're talking about is a situation where for reasons that you typically find in other contexts, you might have somebody who owns a claim but doesn't want to wait for the period of time that it will take to receive payment on that claim. So they want to monetize the value of that claim early. What we've seen is some market-based creativity where various investment firms, maybe private credit, maybe in some cases banks or other investment funds, are thinking about purchasing these claims. They can't outright purchase the claim and step in vis-a-vis the government as the true claim holder, but they can set up different protections and structures so that they're entitled to what the claimant eventually receives.
Read: “Tariffs Tracker – President Adjusts Steel, Aluminum, Copper and Pharmaceutical Tariffs”