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Costco\u2019s newly filed lawsuit in the U.S. Court of International Trade serves as a warning shot for companies that have been paying tariffs imposed under the International Emergency Economic Powers Act (IEEPA). Costco is challenging the legality of these duties and is asking the court to prevent U.S. Customs and Border Protection (CBP) from liquidating its entries, which Costco states are scheduled to begin liquidating as early as December 15, 2025.<\/p>\n
The timing is significant. Once entries liquidate, an importer\u2019s options for recovering duties become more limited, even if a court later determines that the underlying tariff was unlawful. That concern is not unique to Costco. Any importer that paid IEEPA duties on goods entered in late 2024 or early 2025 may face similar pressures as the statutory liquidation period approaches. Costco is one of several well-known companies<\/a> pursuing similar litigation, including Revlon, Kawasaki Motors, Bumble Bee Foods and EssilorLuxottica, the parent company of Ray-Ban.<\/p>\n Below is an overview of the relevant legal framework and considerations for importers evaluating their own timelines.<\/p>\n In 2025, President Trump used IEEPA to impose broad new tariffs on imports from Canada, Mexico, China and many other trading partners, including a \u201creciprocal\u201d tariff program<\/a> that layered new duty rates on top of existing trade measures. Costco\u2019s complaint<\/a> seeks declaratory and injunctive relief. The company challenges the lawfulness of IEEPA-based tariffs and aims to preserve its ability to obtain refunds of duties already paid.<\/p>\n According to the complaint, Costco has paid significant IEEPA duties on a continuous basis. Its entries subject to those duties are scheduled to begin liquidating on or after December 15, 2025, and at least one entry has already liquidated. Costco also states that CBP denied its request to extend liquidation on November 18, 2025.<\/p>\n To preserve its refund rights before liquidation occurs, Costco filed its action in the Court of International Trade on November 28, 2025 and indicates that it intends to seek a preliminary injunction that would halt liquidation.<\/p>\n Liquidation is the final computation<\/a> of duties owed on an entry for consumption or drawback. Once CBP liquidates an entry, the importer receives notice of the final duty amount and any increase or refund.<\/p>\n Because of these limitations, the period before liquidation is often the most important window for addressing potential tariff challenges.<\/p>\n The December 15, 2025 date referenced in Costco\u2019s complaint reflects Costco\u2019s specific entry dates. It is not a government wide or tariff wide deadline for all importers.<\/p>\n However, it still provides a useful signal for the broader importing community.<\/p>\n Costco\u2019s experience also illustrates two practical realities for importers.<\/p>\n For other importers, the key point is not Costco\u2019s specific date but the need to evaluate individual entry timelines before liquidation begins.<\/p>\n The December 15 liquidation date noted in Costco\u2019s complaint applies specifically to its own entries based on early 2025 or late 2024 import dates. Other importers with similar entry timelines may face comparable deadlines as CBP approaches the one year statutory liquidation period, which, in practice, usually occurs around 314 days after entry. Because CBP has discretion to deny extensions and courts have warned that refunds may be unavailable after liquidation, it is critical for importers to act before their entries liquidate. To do so, importers should review their entry dates and monitor liquidation status through CBP\u2019s Official Notice of Extension, Suspension and Liquidation portal<\/a> or ACE reports, then file any necessary complaints or injunctions before liquidation occurs.<\/p>\n Three developments will shape the coming months for importers.<\/p>\n A future court decision addressing the validity of IEEPA duties will not necessarily provide relief for entries that have already liquidated. Companies with meaningful IEEPA exposure should evaluate their timelines, financial risk and legal options now.<\/p>\n KJK\u2019s litigation attorneys are available to review entry data, assess potential exposure and discuss strategies for preserving refund rights under the current legal landscape. To discuss further, please contact KJK Managing Partner (JJP@kjk.com<\/a>; 216.736.7260) or reach another attorney at 216.696.8700.<\/p>\n<\/p><\/div>\nBackground: IEEPA Tariffs and the Costco Lawsuit<\/h2>\n
What Is Liquidation and Why Does It Matter<\/h2>\n
Legal framework<\/h3>\n
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After liquidation occurs<\/h3>\n
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Why December 15 Is Not a Universal Deadline<\/h2>\n
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Practical Steps for Importers Now<\/h2>\n
Looking Ahead<\/h2>\n
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