Costco Sues U.S. Government Over Tariff Payments Amid Legal Uncertainty

In a significant legal move, Costco has taken action against the U.S. government, seeking a complete reimbursement of tariff payments should the Supreme Court determine that these levies were imposed without proper Congressional approval. The lawsuit emphasizes the financial risks the retailer faces amidst ongoing questions about the legality of these tariffs. Costco's legal filing, submitted on Friday, highlights the impending December 15 deadline that could prevent the company from reclaiming any overpayments. Despite its request for an extension from U.S. Customs and Border Protection, Costco’s appeal was denied, placing it in a precarious position if the tariffs are later deemed unlawful. While the specific amount of funds Costco is claiming has not been disclosed, the implications are significant. Typically, importers have six months to dispute liquidation determinations, yet Costco warns that certain tariff assessments may be non-contestable post-factum. This situation exposes companies to the risk of permanently losing the ability to recover payments if such duties are ultimately invalidated. Consequently, Costco's legal representatives argue that a "separate action is necessary" to ensure a refund, emphasizing the need for protection in light of the current legal uncertainty. The lawsuit articulates the concern that “this Court and the Federal Circuit have cautioned that an importer may lack the legal right to recover refunds of duties for entries that have liquidated, even where the underlying legality of a tariff is later found to be unlawful.” In response to the ongoing situation, White House spokesman Kush Desai remarked, "The economic consequences of the failure to uphold President Trump’s lawful tariffs are enormous and this suit highlights that fact," as reported by CNBC. Desai went on to express that the White House looks forward to a “speedy and proper resolution” by the Supreme Court regarding this matter. As one of the world's largest retailers, Costco joins a growing number of companies that are similarly contesting these "reciprocal" tariffs, which affect various trading partners, including Canada, China, and Mexico. According to recent trade data from U.S. Customs, importers had already contributed around $90 billion under this emergency tariff regime by late September.