Costco customers could claim cash from $14 million settlement—who qualifies
Costco customers in Washington state could be eligible for a cash payout under a proposed $14 million class-action settlement that resolves allegations the warehouse retailer sent marketing emails with misleading subject lines promoting supposedly limited-time deals.
The case, Michael Aaland v. Costco Wholesale Corporation, was filed in King County Superior Court in Washington. According to court documents, the lawsuit alleged that Costco violated Washington’s Commercial Electronic Mail Act (CEMA) and Consumer Protection Act by sending promotional emails that advertised temporary or time-limited offers even though the company allegedly knew those promotions would later be extended.
What Was the Lawsuit About?
According to the settlement website and court filings, the plaintiff—Michael Aaland—alleged that Costco’s marketing emails used subject lines that created a false sense of urgency by suggesting consumers had only a short period to take advantage of certain sales.
The court-approved settlement notice states that Costco was accused of sending emails that “advertised temporary or time-limited promotions to consumers, when in fact Costco knew it was going to extend those promotions past the stated time frame.”
Examples cited in the case include subject lines such as: “Today is the last day to access Member-Only Saving” and “Hot Buys available for 5 Days Only.”
The lawsuit claimed such emails violated Washington law governing commercial email communications. Under CEMA, recipients of unlawful commercial email messages may seek statutory damages of $500 per message they received, according to the settlement.
Who Filed the Case?
The litigation was originally filed on June 2, 2025 by Joseph Zydel, according to the settlement agreement. Court records show Zydel later was replaced as the proposed class representative by Michael Aaland, who became the named plaintiff in the case.
The settlement agreement explains that the substitution occurred after attorneys learned Zydel had an existing Chapter 13 bankruptcy repayment plan and believed replacing him would avoid “administrative delays” that could affect the proposed settlement.
What Did Costco Say?
According to the settlement, Costco denied the allegations.
The settlement agreement states that Costco “denies” violating Washington law and maintains that it complied with applicable legal requirements. The company agreed to settle the lawsuit to avoid the expense, uncertainty, and risks associated with continued litigation.
Importantly, the court has not determined whether Costco did anything wrong.
The proposed settlement received preliminary approval from the court in June 2026, with a final approval hearing scheduled for October 2, 2026.
Who Qualifies for a Payment?
According to ClassAction—which reports on class-action lawsuits, settlements, and consumer legal claims—consumers may qualify if:
- They received a commercial email sent by Costco or on Costco’s behalf.
- They were Washington residents when they received the email.
- The email was sent between June 2, 2021, and July 7, 2026.
- The email was sent to an address contained in Costco’s email marketing records.
How Much Money Could People Receive?
The lawsuit says that CEMA allows recipients to seek $500 in statutory damages for each unlawful commercial email message.
However, that doesn’t mean claimants will automatically receive $500 per email through the settlement.
Instead, the settlement creates a $14 million fund that will be distributed among eligible claimants who submit valid claims. The final amount each person receives will depend on how many claims are filed and the deduction of attorneys’ fees, administration costs and other court-approved expenses.
Consumers must submit claims by August 24, 2026, if they wish to participate in the settlement and potentially receive a payment.
Contact Newsweek editors on this story: Daniel Orton and Tony Phillips
