Key Takeaways:
A consumer class action accuses Lululemon of collecting hundreds of millions from shoppers through price increases tied to tariffs later ruled unlawful.
Hagens Berman filed a consumer class action June 30 accusing Lululemon of collecting hundreds of millions of dollars through price increases tied to tariffs the Supreme Court later invalidated, the law firm said.
"Lululemon admitted publicly that tariffs drove up its costs and forced the company to raise prices," Steve Berman, managing partner at Hagens Berman, said. "Now that the tariffs have been ruled unlawful, Lululemon stands to recover millions — money that came from consumers and belongs to them."
The lawsuit, filed in the US District Court for the Western District of Washington, alleges Lululemon raised prices nationwide starting in February 2025 after the Trump administration imposed a 10 percent tariff on Chinese imports under the International Emergency Economic Powers Act. By April 2025, tariffs had expanded to cover most US trading partners, with 25 percent levies on goods from Canada and Mexico. Public estimates showed the tariffs would reduce Lululemon's gross profit by about $240 million, and both the company's CFO and CEO publicly stated plans to raise prices in response.
After the Supreme Court invalidated the IEEPA tariffs on Feb. 20, 2026, Lululemon filed its own suit in the US Court of International Trade to recover the duties it paid. The company has made no commitment to return any portion to consumers, the lawsuit alleges, even as other retailers in similar positions have established tariff refund programs. The case seeks to recover losses under claims of unjust enrichment and violations of state consumer-protection laws.
Tariff Timeline and Legal Mechanics
The IEEPA tariffs took effect Feb. 4, 2025, at 10 percent on Chinese goods, followed by 25 percent levies on Canadian and Mexican imports the next month. By April 2025, the administration had extended tariffs to most other US trading partners, creating the broadest US tariff regime in decades before the Supreme Court struck them down after 12 months in effect.
Under federal law, only the importer of record — the party legally responsible for goods at the time they enter the US — has the right to recover unlawfully collected tariffs. This leaves consumers who bore the cost through higher prices without direct recourse unless the importer passes the refund along. Lululemon imports products from Vietnam, Cambodia, China, Indonesia and Canada, countries that were all subject to the tariff regime.
What's at Stake for Lululemon
The lawsuit exposes Lululemon to potential damages of hundreds of millions of dollars if the court finds the company unjustly enriched by passing tariff costs to consumers while retaining the right to recover those same duties from the government. The case also raises questions across the broader retail and apparel sector about similar tariff-cost pass-through practices during the 12-month period the IEEPA tariffs were in effect. Other retailers have voluntarily established tariff refund programs for customers, a step Lululemon has not taken, according to the complaint.
This article is for informational purposes only and does not constitute investment advice.
