Costco Takes White House to Court Over Tariffs

Costco has sued the Trump administration over what it calls the country’s “unlawful” tariffs.

In a lawsuit filed last week, the warehouse retailer asks the Court of International Trade to consider all tariffs collected under the International Emergency Economic Powers Act (IEEPA)  illegal, and seeks a full refund of all levies paid under President Donald Trump’s tariffs.

“Because IEEPA does not clearly authorize the President to set tariffs … the Challenged Tariff Orders cannot stand and the defendants are not authorized to implement and collect them,” the suit says.

Costco added that the company is facing “imminent and irreparable harm because entries for which it paid IEEPA duties are anticipated to liquidate as early as Dec. 15.”

Liquidation here is a reference to the “final computation or ascertainment of duties on entries for consumption or drawback entries,” the suit added.

With this litigation, Costco joins companies including Revlon, Kawasaki and Bumble Bee Foods in suing the White House over its tariffs.

In a statement to The Wall Street Journal, White House spokesperson Kush Desai responded by saying the “economic consequences of the failure to uphold President Trump’s lawful tariffs are enormous, and this suit highlights that fact.”

The suit comes as the U.S. Supreme Court weighs the legality of the tariffs following a legal challenge from a dozen states and hundreds of businesses.

As reported here last month, members of the court’s conservative majority, including Justice Amy Coney Barrett, joined the liberal justices in sharply questioning the government’s chief counsel in the case, Solicitor General D. John Sauer.

“Is it your contention that every country needed to be tariffed because of threats to the defense and industrial base?” Barrett asked. “I mean, Spain? France? I mean, I could see it with some countries, but explain to me why, as many countries needed to be subject to the reciprocal tariff policy as are.”

Sauer contended that the case is not about the power to conduct foreign affairs, rather than the power to tax.

“I can’t say it enough, it is a regulatory tariff, not a tax,” he said.

But even if the Supreme Court rules against the government, Costco argued its lawsuit is still necessary, as it is “not guaranteed a refund for those unlawfully collected tariffs in the absence of their own judgment and judicial relief.”