Costco has sued the Trump administration for a refund of the tariffs it has paid on imported goods, should the Supreme Court rule them illegal, becoming one of the largest companies to challenge President Trump’s sweeping levies in court.
The complaint, filed on Friday in the U.S. Court of International Trade, argues that Mr. Trump misused a 1977 law in his move to implement tariffs on products from more than 100 countries.
The lawsuit asserts that Congress, not the president, has the authority to set tariffs, and that Mr. Trump exceeded the authority granted to him by the law, the International Emergency Economic Powers Act, or IEEPA .
“The text of IEEPA does not use the word ‘tariff’ or any term of equivalent meaning,” Costco states in the lawsuit, which was reported earlier by NBC News. The act allows the president to regulate or prohibit foreign transactions during a national emergency, but does not authorize the imposition of tariffs, according to the lawsuit.
Kush Desai, a spokesman for the White House, said in a statement that the “economic consequences of the failure to uphold President Trump’s lawful tariffs are enormous and this suit highlights that fact. The White House looks forward to the Supreme Court’s speedy and proper resolution of this matter.”
It has said in the past that its use of the IEEPA is lawful because the law gives the president the authority to “regulate” the “importation” of foreign property to deal with emergencies.
The challenge by Costco, the largest warehouse club chain in the United States, echoes arguments that a number of small businesses have already made before the Supreme Court in lawsuits against Mr. Trump’s tariffs.
Costco argues that the Trump administration’s implementation of them has created chaos. The tariffs have been “threatened, modified, suspended, and reimposed, with the markets gyrating in response,” the lawsuit says. The lawsuit does not disclose how much Costco has paid in tariffs.
Importers like V.O.S. Selections, a wine and spirits company, and Learning Resources, Inc., an educational toymaker, have already secured major rulings against the administration in lower federal courts. The Supreme Court heard oral arguments last month and is expected to rule on the legality of the tariffs in the near future.
Mr. Trump argues that tariffs have helped bring the government “hundreds of billions of dollars,” and the administration has warned of a severe economic impact should businesses be allowed to seek refunds if the government loses the Supreme Court case.
If the administration loses the Supreme Court case, there are other ways to tax imports. Multiple trade authorities exist that would allow the president to impose tariffs that are not subject to the IEEPA, and some of those provisions are already in use.
Jenny Gross is a reporter for The Times covering breaking news and other topics.
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