Costco Increased Prices for Consumers Under Illegal Tariffs, Class Action Lawsuit Claims

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Costco has been hit with a proposed class action lawsuit that alleges the wholesale retailer wrongfully passed on to consumers the costs of tariff duties that the United States Supreme Court has since declared unlawful.

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The 15-page tariffs lawsuit claims that Costco, the third-largest retailer in the world, wrongfully increased its prices to recoup the “economic burden” of tariff-related charges imposed by President Donald Trump under the International Economic Emergency Powers Act (IEEPA). “[F]or all intents and purposes,” consumers paid for the illegal tariffs due to the higher prices, the case says.

The complaint was filed following a February 20, 2026 Supreme Court opinion in a case known as Learning Resources, Inc. v. Trump that invalidated all tariffs levied under the IEEPA, which were then terminated via executive order.

According to the lawsuit, Costco runs on a membership model where consumers pay an annual fee to access “low pricing on a vast array of goods.” Like most retailers burdened by tariffs, Costco, the suit says, passed the “bulk” of the tariff obligations onto consumers. In fact, the case says that Costco was able to increase its profits and “expand margins” when the unlawful IEEPA tariffs were in effect.

The lawsuit contends that as a “direct result” of Costco’s “pass-through” tariff pricing, consumers were forced to pay higher prices than they otherwise would have without the IEEPA tariff regime.

Indeed, the filing states that Costco’s CEO publicly acknowledged that the company had raised prices, stating that “we did increase some price [sic] there because we felt that was something that the member would be able to absorb.”

Consumers were quick to notice, the case states, citing a post made on Reddit in September 2025 where one user commented they had noticed “significant price increases on [a] majority of the items.” An October 2025 Facebook comment cited in the filing similarly notes that despite seeing “price hikes” at most grocery stores, Costco’s price increases were “higher than most.”

The lawsuit says that Costco, along with nearly 2,000 other companies, is attempting to “recover” tariff refunds from the federal government, and the complaint states that “[t]hey seem likely to succeed.” Additionally, the case says that on March 4, 2026, the Court of International Trade ordered that IEEPA tariffs should be refunded to “[a]ll importers of record.”

Related Reading: Class Action Lawsuit Claims UPS Collected Illegal Tariffs from Importers, Consumers

Costco is “poised” to be paid twice for unlawful tariff burden, “once by its customers (through elevated prices) and once by the U.S. government,” the class action lawsuit claims. The filing estimates that Costco is entitled to “hundreds of millions” in refunds, potentially surpassing one billion dollars.

The lawsuit states that as of the filing date, Costco has not said if it intends to reimburse consumers in any way for the tariff-related price increases seen throughout its stores, even though consumers were “shouldering two-thirds of President Trump’s new tariff cost.” Essentially, the lawsuit states that it aims to prevent Costco from “double recovery” and profiting from a situation that caused consumers financial hardship.

The Costco class action lawsuit seeks to cover all individuals in the United States who purchased from any Costco retail channel any good subject to the tariffs imposed under IEEPA, during the period February 1, 2025 through February 24, 2026.

Learn all about the legal process: What is a class action lawsuit?