Warehouse workers review documents amidst stacked inventory, forklifts in motion.
Nike is embroiled in a class action lawsuit that accuses the sportswear giant of failing to refund consumers for tariff-related costs that were allegedly passed on through higher prices. The lawsuit, filed in federal court in Portland, Oregon, centers on the U.S. Supreme Court’s February ruling which stated the president lacked the authority under the International Emergency Economic Powers Act (IEEPA) to impose certain tariffs.
Plaintiffs contend that Nike, which reported paying approximately $1 billion in tariffs on imported goods due to these actions, inflated prices on some footwear by $5 to $10 and on apparel by $2 to $10 to offset these costs. The complaint alleges that Nike has made “no legally binding commitment to return tariff-related overcharges to the consumers who actually paid them.” This could result in Nike recovering the tariff payments twice: once from consumers via elevated prices and again from the federal government through refunds.
This legal challenge is not isolated, as several major companies, including Costco, are facing similar lawsuits for allegedly not passing tariff-related refunds to consumers. It’s reported that over 2,000 companies have initiated legal action in the U.S. Court of International Trade to recover tariffs paid on imported goods.
Nike has previously indicated that tariffs would materially impact gross margins through the fiscal quarter ending August 2026. This lawsuit follows closely on the heels of Nike’s announcement of plans to lay off approximately 1,400 employees across its Global Operations team, primarily impacting its technology division in North America, Asia, and Europe. Nike has declined to comment on the lawsuit.
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