On Friday, while regaling reporters following the unfavorable Supreme Court ruling which crumbled a key pillar of his tariff regime, Donald Trump confirmed the worst nightmare for American importers.

Hundreds and probably thousands of small- and medium-sized businesses who paid the trade levies out of their own pockets last year are left in the lurch. They paid import duties which turned out to be illegal, and there’s no efficient way to reclaim the money.

In his February 20 harangue, Trump said businesses will have to litigate their refund claims, and noted that the process could take as long as half a decade. “I guess it has to get litigated,” he said. “We’ll end up being in court for the next five years.”

A lot of small businesses won’t have the resources for that, which means — and there’s really no way around this — they were robbed and the only recourse they have is beyond their financial wherewithal.

Consider how convoluted this is about to get for anyone not resigned to writing the illegitimate levies off as a sunk cost.

Some of the impacted businesses have banded together, and I imagine some law firms will be willing to do this work pro bono. And then there’s the nascent market for tariff claims, which some businesses sold to investors for pennies on the dollar ahead of the SCOTUS ruling. I’ll focus on those claims, because that market’s about to get interesting.

The rationale for selling away your refund rights as an importer was simple: If you were out money from the tariffs but you knew you wouldn’t be able to afford to sue Trump in the event the court struck those tariffs down, it was best to monetize your claim on a theoretical refund by selling that claim to a hedge fund, because at least then you get something.

Some importers did just that. As Wired noted, “only a select few hedge funds engaged in the trade [but] those that did generally bought tens of millions of dollars worth of claims.” Because the court didn’t rule on the refund question, the fate of those claims rests, in the interim anyway, with the lower courts.

Of course, Trump will challenge any lower-court ruling which demands Treasury pay out full refunds. That means investors who own those claims are now in the same boat as the importers from whom they purchased the refund rights: Staring down a legal battle with the Trump administration.

Any fund or investor who goes that route will have to net the cost of litigation against the full refund payout with the latter adjusted for i) the opportunity cost of the money spent on legal fees during what’s likely to be a lengthy court battle and ii) the odds of the Supreme Court ultimately ruling that Trump has to issue the refunds.

That, in turn, likely means only the deepest-pocketed, most well-connected hedge funds and alternative asset managers will be willing to take this on. For anyone else, it’s a fool’s errand.

Importers’ desperation equated to a lot of leverage for the funds which bought their claims. But assuming prediction websites made markets for this event, and assuming those markets were deep enough to handle tens of millions in action, small funds would’ve been better off trading the SCOTUS outcome there. Because they could’ve made a bet on a binary outcome with a contract that clearly specified the terms for collecting.

Instead, their hypothetical payoff — which the Wired article puts as high as ninefold — has to be adjusted not just for the cost of securing it through litigation, but also for the odds of an unfavorable court ruling, which would render the claims worthless and the legal fees wasted.

And that’s to say nothing of the fact that the defendant is going to be The President of the United States who — and I don’t need to ask forgiveness for this characterization because he’d probably take it as high praise — is an asshole whose fondness for litigation is the stuff of legend.

As one niche distressed debt investor who spent nearly $1 million of his own money buying tariff refund claims from importers put it, in remarks to Wired, “Trump is Trump is Trump, man. I’m not sure if you want to be on the other side of him, no matter how good the legal arguments are.”

Me neither. And it’s important to note that the administration issued a series of Executive Orders early last year threatening reprisals against law firms seen as taking cases at odds with Trump’s agenda.

So, imagine you’re a small fund or a maverick distressed debt manager sitting with a pile of IEEPA tariff refund claims. You paid $1 million for them, and they’re theoretically worth $10 million. But getting that $10 million means suing Trump. And the cost of that goes well beyond legal fees.

By suing him, you’re putting yourself on his radar, with everything that entails. Suffice to say I hope your mortgage documents are spick and span, and I hope your accountant has crossed your t’s and dot your i’s. Because there’s a very good chance FHFA and the IRS are going to be taking a very hard look at your paperwork. They’ll find something, and then you’ll have more legal fees.

My advice to any such claims holders (and this isn’t official “financial” advice, it’s an unofficial tip from a political scientist who’s studied autocracies for two decades), is to market your claim to somebody with the institutional clout and connections to safely navigate these extraordinarily treacherous waters.

Simply put: If you paid $1 million for IEEPA tariff refund claims that are theoretically worth $10 million, sell those damn things to the first buyer who comes along offering $2 million or $3 million. You may think those claims are assets, but I can assure you they’re going to feel more like liabilities if you try to collect.