In brief
In a significant legal move, Costco has initiated a lawsuit against the US government to demand a refund of tariffs imposed under President Trump's authority, which they argue is illegal. This comes as the Supreme Court prepares to hear arguments on the validity of these tariffs, with previous rulings against their constitutionality. Costco claims the tariffs have negatively impacted their business and seeks judicial relief as they approach a critical December deadline for potential refunds. The outcome could affect many companies similarly burdened by the tariffs.
Multinational retail giant Costco has sued the US government to secure a full refund of import duties if the Supreme Court rejects President Donald Trump's authority to impose tariffs without congressional approval.
Costco's lawsuit urges the federal trade court to declare Trump's 'emergency' tariffs illegal, an authority the president claims to have under the International Emergency Economic Powers Act (IEEPA).
Two lower courts have already ruled that Trump exceeded his authority by using emergency powers to impose tariffs.
The case has now reached the Supreme Court, and several companies are attempting to protect their rights to refunds should the justices strike down the tariffs.
In the lawsuit filed over the Thanksgiving holiday, Costco stated that its business had suffered due to the tariffs and expressed concern that it wouldn’t receive its money back even if the apex court upheld previous rulings.
Lawyers for Costco argued that a separate action is necessary as a refund is not guaranteed in the absence of their own judgment and judicial relief.
The world's third-largest retailer did not specify how much it was seeking back, but trade data from the US customs agency shows importers like Costco have already paid around $90 billion in IEEPA-related tariffs as of late September.
Costco's suit was brought to the US Court of International Trade ahead of a December 15, 2025 deadline, beyond which it might struggle to recover any funds paid to the government.
In May, that court was the first to rule that Trump’s tariffs were unlawful, a decision that was subsequently confirmed by the US Court of Appeals.
During a recent hearing, Supreme Court justices seemed doubtful about the president's authority to impose the levies without congressional backing.
Lawyers representing the Trump administration argued that emergency powers grant the president the authority to impose global tariffs.
The administration has cautioned that an unfavorable ruling could hinder its ability to negotiate with other countries and lead the treasury to lose billions already collected.
White House spokesperson Kush Desai stated, The economic consequences of the failure to uphold President Trump's lawful tariffs are enormous and this suit highlights that fact. They added, The White House looks forward to the Supreme Court's speedy and proper resolution of this matter.
Last month, the president asserted that the US was taking in Trillions of Dollars in tariffs and promised a dividend of at least $2000 a person (not including high income people!) will be paid to everyone.
