Nintendo sues Donald Trump’s government over illegal tariffs

Nintendo has filed a lawsuit against the US government, over tariffs imposed by President Donald Trump just before the launch of the Switch 2.

In April of last year, in the run-up to the launch of the Nintendo Switch 2, US President Donald Trump imposed a wave of higher tariffs against multiple countries, including manufacturing hubs such as China and Vietnam.

This move caused Nintendo to delay pre-orders of the Switch 2 in the US and Canada, in order to ‘assess the potential impact’ of the tariffs. A few weeks later, and while it didn’t increase the price of the console itself, Nintendo did raise the price of various Switch 2 accessories in the countries, including the Pro Controller and camera.

Now, almost a year later, Nintendo is suing the US government for what it describes as ‘unlawful trade measures’, which have allegedly ‘resulted in the collection of more than $200 billion in tariffs on imports from nearly all countries’.

This is only happening now because last month the US Supreme Court struck down the majority of Trump’s tariffs after ruling that his use of the International Emergency Economic Powers Act (IEEPA) was illegal.

Trump responded by imposing a temporary 10% global tariff under a different law – Section 122 of the Trade Act of 1974. However, the Supreme Court ruling has sparked a flurry of lawsuits, from over two dozen states in the US and over 1,000 companies – including FedEx and Costco – which are looking to recoup costs from the illegal tariffs.

This lawsuit from Nintendo Of America, filed on March 6, is in the same vein. The filing claims the company has been ‘substantially harmed by the unlawful execution and imposition of the unauthorised Executive Orders and corresponding payment of the IEEPA Duties’.

‘[Nintendo Of America] has standing to sue because it is the importer of record for goods that were subject to IEEPA Duties,’ the lawsuit reads.
Nintendo is seeking a refund ‘with interest’ on any IEEPA duties the company paid – although it doesn’t highlight a specific amount.

If they are successful, it’s unclear when Nintendo and other companies will receive a refund. On Wednesday last week, Judge Richard Eaton ruled that companies are entitled to refunds, and The Wall Street Journal claims a tariff refunds system via the Customs and Border Protection will be operational in 45 days.

Nintendo mostly manufactures Switch 2 consoles in China and Vietnam, and following last year’s tariffs, the company reportedly leaned on Switch 2 units imported from Vietnam, instead of China, in order to dodge higher tariff costs and maintain the console’s price.

Although they didn’t release a new console last year, Sony and Microsoft are in a similar position with the PlayStation 5 and Xbox Series X/S, but there’s no report yet that they are suing for refunds.

Beyond tariffs, the next potential threat to the Switch 2’s price is the memory chip shortage. Nintendo president Shuntaro Furukawa didn’t rule out a price hike during an investor’s Q&A last month, but said that he doesn’t expect the crisis to significantly impact the company’s hardware profitability over the next financial year.

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