Trump Tariffs Trigger Lawsuit as Costco Customers Seek Refunds
Synopsis
An Illinois federal court on Wednesday was hit with a nationwide class action suit by a Costco customer suing for the return of any tariff refunds received by customers who paid higher prices. The lawsuit comes after a February 20 Supreme Court decision that overturned Trump’s broad tariffs as illegal. Costco’s chief executive, Craig Jelinek, said the company would pass any refunds along to customers through lower prices but offered no specific details. Other companies seeking to recoup tariff duties, including more than 2,000 plaintiffs that have already sued the government, include Costco. FedEx is also being sued by consumers in a similar lawsuit in Florida. More than $130 billion was raised under the tariff law in total
Customers of Costco filed a class action suit insisting that any refunds the company receives for tariffs get passed back to shoppers. The case comes after the Supreme Court issued a ruling on Feb. 20 that overturned Trump's emergency tariffs.
Key Highlights
- Costco shoppers in the US sued on Wednesday for tariff refunds.
- Costco is one of more than 2,000 companies that are already suing the government to recover tariff duties they’ve paid.
- FedEx has a similar consumer lawsuit against it filed last month in federal court in Florida.
Costco Customers Sue to Ensure Money From Tariff Refund Goes Back
Costco Wholesale was sued on Wednesday in a proposed national class action that seeks refunds for customers who paid higher prices charged by the company after the Supreme Court invalidated import tariffs imposed by President Donald Trump. The people who filed the case shop at Costco regularly.
The lawsuit, filed on behalf of a Costco shopper in federal court in Illinois, asks for a ruling that the company must return to customers any refunds it gets from tariffs it paid under the International Emergency Economic Powers Act. The argument in layman’s terms means, if Costco ended up paying more due to the tariffs and passed that cost along to shoppers, then if Costco gets the money back, so should shoppers.
There Is No Legal Question About Those Tariffs
On Feb. 20, the Supreme Court held that Trump had exceeded his authority in using the emergency powers law to impose sweeping tariffs last year. That ruling set the stage for what could become one of the largest refund scenarios in US trade history. And soon after the ruling came down, companies and consumers alike had one question, who gets money back and how much?
About $130 billion has been collected from Trump’s tariffs under the emergency powers law, and the Supreme Court’s ruling did not provide clear guidance on how refunds would actually play out. Justice Brett Kavanaugh acknowledged in a separate opinion that the process of sending all that money back was likely to be messy. That uncertainty is precisely why customers are turning to the courts now, rather than waiting to see what happens.
Costco Said It Would Pass Refunds on to Customers
It remained unclear if, or when, businesses would be able to reclaim the tariffs they paid before, Costco’s chief executive officer Ron Vachris said in a call with analysts last week. If any refunds do pass through to Costco, he said the retailer intends to pass them on in the form of lower prices and enhanced value for shoppers. That sounds good, but the lawsuit says, it is not enough.
The customers who brought the case argued that promising lower prices to future shoppers at some point in the future was not the same as giving back money to those who have already paid more. The lawsuit, filed Wednesday, said the company was promising a potential future benefit to an unknown number of future shoppers. The consumers who were charged higher during the tariff period want to see themselves get something back, not just whoever lives near the Costco down the road.
This Is All Part of a Much Larger Legal Battle
Costco is one of more than 2,000 companies suing the administration to regain duties they paid, while global shipper FedEx is facing a similar consumer class action that was filed in Florida federal court last month. The number of companies involved illustrates how far-reaching these tariffs were. It was not only a handful of sizable retailers. It roiled thousands of businesses in every corner of the US economy.
During the period between February 2025 and January 2026, American consumers absorbed over $231 billion in costs from tariffs, about $1,745 per household. Senator Elizabeth Warren added that there is no legal avenue at the moment for everyday consumers and small businesses to recover that money on their own. Those big companies with lawyers can sue and extract refunds and then just keep the money, a system that was rigged against regular folks. The Costco lawsuit is one effort to do something about it.
FAQs
1. Why are Costco customers suing?
They want to ensure that if Costco receives money from the government for tariff refunds, it goes back to the shoppers who paid more, not just stays with the company.
2. How much money are we talking about?
The amount collected under the tariff law was about $130 billion and, with interest, the estimated total owed could exceed $175 billion with respect to companies and goods of all kinds.
3. Is Costco the only company its customers sue?
No, FedEx is also facing a customer class action lawsuit of this nature filed in its native Florida and more such cases will follow.
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