Costco says no refunds owed to customers for tariff price hikes

By Jonathan Bilyk | Legal Newsline
The Center Square

CHICAGO — Warehouse club retail giant Costco says it doesn’t owe its customers any refunds for higher prices they paid when Costco allegedly increased those prices to account for the cost of unconstitutional tariffs imposed by President Trump.

In a May 18 filing, Costco asked a federal judge to dismiss a class action lawsuit demanding such refunds. In that filing, Costco asserted the lawsuit is at best premature, because the company has not itself yet received any refunds from the federal government to cover its own tariff expenses.

And even if it does receive a refund, Costco said customers’ lawsuits accusing the retailer of fraud also must fail, because the customers can’t show they were ever misled into paying for any of the goods or products they purchased from Costco.

“It does not matter whether plaintiff paid a higher price then he thinks he should have paid,” Costco wrote in a brief in support of its motion to dismiss. “Plaintiff got what he paid for, and Costco never suggested that it would (or even might) later refund part of the purchase price.”

Costco’s filing landed a little over two months after attorneys from the firm of Korein Tillery, of Chicago, first filed suit against the company in Chicago federal court. The lawsuit was filed on behalf of named plaintiff Matthew Stockov, identified only as a resident of northern Illinois who is a Costco member that regularly shops at Costco.

However, the plaintiffs are seeking to expand the action to include potentially tens of millions of other people across the country, and particularly in the states of Illinois, California, Florida, Michigan, Missouri, New Jersey, New York, Ohio, Washington and Wisconsin, who purchased goods from Costco between February 2025 and February 2026.

The lawsuit is one of an estimated 17 class actions filed against retailers and shipping companies across the country. Those lawsuits accuse the companies of allegedly defrauding customers by allegedly attempting to keep “windfall profits” they allegedly may earn in the wake of the U.S. Supreme Court’s ruling striking down the tariffs imposed by President Donald Trump on imported goods.

In Chicago courts, the lawsuit against Costco has been joined by legal actions against Chinese online discount sellers Temu and Shein and against activewear seller Fabletics.

The lawsuits all assert the retailers responded to Trump’s tariffs by increasing prices on goods.

The complaints against Temu and Shein, for instance, accused the retailers of increasing prices of some products by as much as 377%.

The lawsuit against Costco pointed to reports indicating the warehouse retailer had increased prices by about 30%.

No matter the actual totals, court documents indicate the plaintiffs against Costco believe the company may have tacked on as much as $1.1 billion to the prices paid by Costco’s U.S. members during the time the tariffs remained in effect.

So, the plaintiffs in the lawsuits claim retailers and shippers who raised their prices now owe consumers a refund, after the Supreme Court declared the federal International Emergency Economics Act did not give U.S. presidents the power to unilaterally impose tariffs.

While the lawsuit against Costco was filed in Chicago federal court, the lawsuits against Shein, Temu and Fabletics originated in Cook County Circuit Court. The three companies have since removed those lawsuits to federal court, where they remain pending.

However, Costco and the Chinese online retailers have all moved quickly to attempt to bring the legal actions to swift ends.

In the lawsuits against Temu and Shein, the Chinese companies have asserted in new court filings that the disputes don’t belong in court. Rather, they assert user agreements dictate the dispute must instead go to individual arbitration. Should the courts grant those requests, the companies could succeed in largely ending the class actions.

Meanwhile, Costco has opted to mount a frontal defense against the lawsuit, asserting it has no legal basis to continue.

The company notes it is just one among a long list of retailers and other companies demanding refunds from the federal government for the illegal tariffs. Costco noted their legal action remains pending, and the company has received no guarantees it will ever see any refunds.

But, even if it ultimately receives a refund, Costco further said it has not defrauded anyone or violated any state consumer fraud law.

So, the retailer asserts the lawsuit should be dismissed.

Plaintiffs have not yet responded to the dismissal motion in court.

Costco is represented by attorneys from the firms of Munger Tolles & Olson, of Los Angeles and Washington, D.C.; and Perkins Coie, of Chicago.