Costco Sues Trump Administration Over “Illegal” Tariffs, Seeks Protection for Billions in Potential Refunds

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  Newsroom

• December 03, 2025

• Newsroom

Costco Sues Trump Administration Over “Illegal” Tariffs, Seeks Protection for Billions in Potential Refunds

Costco Wholesale Corporation has filed a lawsuit against the administration of President Donald J. Trump, arguing that the emergency tariffs imposed on thousands of imported products were unlawful and exceeded presidential authority under the International Emergency Economic Powers Act (IEEPA). The lawsuit was filed in the U.S. Court of International Trade (CIT).

The company is seeking to preserve its right to obtain full refunds for duties it paid over the past year should the Supreme Court, or lower courts, ultimately rule that the tariffs were imposed without legal basis.

Costco Says Tariffs Were Imposed Under Powers Never Intended for Trade Policy

According to the complaint, Costco argues that the Trump administration used IEEPA, normally invoked to freeze assets or restrict transactions involving hostile foreign actors, to justify broad, multi-industry tariffs unrelated to national security threats.

Reuters reports that Costco emphasized that several federal courts have already found these tariffs unlawful, determining that IEEPA does not authorize the president to levy general import duties.

The lawsuit states that unless the tariffs are invalidated soon, U.S. Customs and Border Protection (CBP) may “liquidate” past entries, finalizing the charges, making it impossible for importers to recover billions of dollars already paid.

Largest U.S. Retailer Yet to Challenge the Policy

Costco is the largest corporation to date to join the wave of lawsuits contesting the tariff regime. Other companies, including Revlon, Bumble Bee Foods, and EssilorLuxottica, filed similar challenges earlier this year.

According to AP News, Costco’s challenge significantly increases the pressure on the administration because of the company’s scale and its purchasing footprint across global supply chains.

Supreme Court Case Looms Over Tariff Legality

The legal dispute escalates as the U.S. Supreme Court considers a related case that questions the constitutionality of using emergency powers for tariff policy.

According to The Guardian, and Washington Post During oral arguments on November 5, several justices expressed skepticism about the government’s interpretation of IEEPA, raising the possibility that the Court may restrict or overturn the tariff mechanism entirely.

Costco’s attorneys said the company must secure judicial protection now because a Supreme Court ruling may come too late to prevent the liquidation of past import entries.

Background: The Tariffs at Issue

The contested tariffs were introduced as part of the Trump administration’s broader effort to reshape trade relationships and protect U.S. industries. Under the emergency orders:

• duties were applied to thousands of consumer and industrial products,

• companies argued that the rules created unpredictable costs,

• and importers said prices were ultimately passed to U.S. consumers.

Costco asserts that these costs accumulated to tens of millions of dollars, all of which may be refundable if courts rule that the administration exceeded its statutory authority.

What Happens Next

The CIT is expected to consider Costco’s request to prevent liquidation of its tariff entries while the Supreme Court reviews related cases. A ruling in favor of Costco, even temporarily, could encourage a significantly broader wave of litigation from American importers.

Legal analysts told Reuters that the case may determine whether future administrations can use emergency national security powers to enact large-scale economic policies without Congressional approval.