NEW YORK — Costco Wholesale Corp. on Friday sued the U.S. government in the U.S. Court of International Trade in Manhattan, according to a complaint that seeks to preserve potential refunds from Donald Trump’s disputed global import duties if the Supreme Court ultimately overturns his emergency tariff powers, Dec. 2, 2025.
The retailer says customs officials are working to finalise — or “liquidate” — its import entries by mid-December, and contends that, without quick intervention, the Costco tariffs it has already paid could become irreversible even if the justices eventually find the levies unlawful.
Costco tariffs lawsuit speeds toward Dec. 15 deadline.
In its 26-page complaint, Costco asks the trade court to rule Trump’s “reciprocal” and “trafficking” tariffs illegal, to halt U.S. Customs and Border Protection from collecting more of them, if any remain unpaid on Nov. 28, and to make sure that practicing customs law isn’t enough for a reseller or wholesaler dealing across borders while in-transparent to claim such a refund. The filing, first reported by Reuters, says that some of the entries can be liquidated as early as Dec. 15, terminating Costco’s right to a refund.
U.S. Customs officials recently denied Costco’s request for an extension of that liquidation window, the complaint says, leaving the company to argue in court that only a judge can prevent its tariff bills from becoming irreversible. At the same time, the Supreme Court considers Trump’s authority. Separately, Business Insider reports that Costco is demanding a “full refund” of duties imposed under the emergency tariff orders and cautions that importers aren’t entitled to automatic refunds even if the White House ultimately loses in court.
Costco has refused to say what it is paying, but the Washington state–based chain ranks among the most import-dependent U.S. retailers. About a third of its U.S. sales are from imported products, and 8 per cent come from China – revenue the Trump administration has collected around $88 billion on since challenged duties went into effect, and projects as much as $2.3 trillion over a decade, The Washington Post reported.
Those Costco tariffs have pinched margins even as the company has made efforts to shield members from sticker shock, nudging prices higher mostly on discretionary imports like floral and non-staple items while holding the line on staples like fresh fruit and pantry basics, executives said. Costco has also leaned more heavily on local sourcing, cut back on some suppliers, and expanded its Kirkland house brand in an effort to dull the blow.
Costco tariffs fit into the Supreme Court test of Trump’s power
The Costco tariffs case is pending alongside Learning Resources v. Trump. This consolidated Supreme Court challenge will determine whether the International Emergency Economic Powers Act (IEEPA) permits presidents to use emergency powers to levy sweeping tariffs on imports — and, if so, whether that broad grant of taxing authority is constitutional.
In over two hours of arguments on Nov. 5, several justices on both sides of the ideological spectrum seemed doubtful that the administration’s theory would pass muster under IEEPA, which lets a president unilaterally hike duties on virtually all imported goods if he persuades himself that it’s necessary “to address” sweeping “national emergencies” like trade deficits or drug trafficking — as SCOTUSblog reported in its description of the arguments. An earlier Federal Circuit decision in August also found that IEEPA doesn’t grant Trump’s “reciprocal” tariffs and warned that interpreting the act as a blank check would pose serious separation-of-powers issues — a ruling Holland & Knight explained.
Should the Supreme Court side with those lower courts, the government could be subject to refund claims of nearly $1 trillion, based on estimates referenced in Costco’s complaint and in congressional research on potential liability from IEEPA-based tariffs. The White House has circulated a warning that a widespread loss would blow an enormous hole in the budget, leading to draconian spending cuts, even as import-heavy companies clamour that they should never have been billed in the first place.
The Costco tariffs case is the latest in a years-long fight over tariffs.
Costco’s decision is the latest development in a string of courtroom battles over Trump-era trade policy. In 2020, during the peak of the U.S.–China trade war, some 3,500 companies had filed suits challenging previous rounds of Chinese import duties, arguing that officials violated congressional timelines established for Section 301 tariffs, as Reuters reported at the time.
Smaller importers like wine distributor V.O.S. Selections (pictured) and educational toy maker Learning Resources also won major lower-court victories recently over the IEEPA “reciprocal” tariffs, with judges determining that the law was never intended to facilitate across-the-board tax hikes on virtually all imports. The V.O.S. case, which was filed by public-interest lawyers and summarised by the Liberty Justice Centre, consolidated many of the current refund suits.
Trade lawyers say Costco’s decision to file now, as the Supreme Court weighs Trump’s authority, reflects a painful lesson from that previous wave of litigation: If, at the end of the day, an entity challenges tariffs and they are scratched out by final judgments against someone else, companies that fail to add themselves to pending lawsuits may lose their shot. Because the Costco tariffs showdown is not just about legal theory for Costco: It is a race against the calendar, trying to keep the door open to refunds that could one day total billions of dollars.
No matter how it’s decided, the case illustrates how an abstract battle over wartime economic powers has now reached the checkout lines. If the Supreme Court sides with Trump, Costco and other heavy importers might be on the hook for permanently elevated costs; if it doesn’t, then the Treasury could owe giant refunds — while companies that got Costco-style tariff refunds will need to determine whether those funds get spent benefiting consumers through lower prices, workers via higher wages or shareholders.
