By Alex Halverson
The Seattle Times
(TNS)
A Microsoft customer is accusing the company of passing the costs of tariffs onto consumers while standing to gain from federal government refunds.
In a proposed class-action lawsuit that was filed in King County Superior Court last month and removed to a federal court last week, Xbox purchaser Trevor Hastings claimed that Microsoft would effectively reap the benefits of President Donald Trump’s widely imposed tariffs last year.
Hastings, a Chula Vista, Calif., resident, argued that by passing the costs onto customers and then receiving refunds, those who purchased Xbox products would be left holding the bag.
Microsoft isn’t the first company to face legal action over tariff-related refunds. Amazon, Nintendo, Lululemon and Costco have all been slapped with lawsuits claiming customers bore the brunt of tariff-related costs.
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The lawsuit against Microsoft covers the time from Trump’s tariffs in April 2025 to the U.S. Supreme Court ruling against the tariffs in February 2026, during which Hastings said he bought the Xbox.
Following the U.S. Supreme Court’s ruling in February that Trump’s sweeping tariffs announced in April 2025 were illegal, the U.S. Department of Treasury has disbursed about $81 billion so far in refunds to companies that imported goods.
Microsoft raised Xbox prices by $20 to $70, depending on the model, in October but didn’t attribute the jump to tariffs or any specific reason. The company said it was due to changes in the macroeconomic environment.
Microsoft did not respond to a request for comment.
In June, Microsoft announced another increase in prices for its Xbox consoles, effective Aug. 1. The company is now blaming what it calls the components crisis, as artificial intelligence development raises the cost of materials that affect a device’s memory and storage.
Though not a problem specific to Microsoft, the company said in a June blog post that video game consoles were hit harder by the components crisis than products like smartphones and computers because consoles are typically not sold at a profit.
Microsoft said storage and memory costs have more than doubled since it last raised Xbox prices. It expects those costs to double again by fall 2027.
The proposed class-action lawsuit against Microsoft is filed in the U.S. District Court for the Western District of Washington. The lawsuit seeks monetary relief, including compensatory and punitive damages as well as litigation costs.
Photo credit: Wikimedia Commons
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© 2026 The Seattle Times. Visit www.seattletimes.com. Distributed by Tribune Content Agency LLC.
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Tags: import taxes, lawsuits, Microsoft, tariff refunds, tariffs, Taxes, trade taxes, trump tariffs, Xbox
