Fishing gear supplier, wine importer, toy maker among businesses challenging Trump tariffs at SCOTUS
The companies challenging President Donald Trump’s aggressive tariff policies in a pair of consolidated cases that will go before the U.S. Supreme Court next week are not exactly ones to be found on the Fortune 500.
One case was brought by a group of plaintiffs that includes an importer of wine, sake and spirits from six continents; another company that imports raw materials for manufacturing plumbing and drainage products; an e-commerce supplier of sport fishing gear; and a women’s cycling apparel brand.
The companion case going before the justices Wednesday was brought by a family-owned pair of educational toy companies that serve the consumer and school markets with such hands-on products as the Pretend & Play Calculator Cash Register and the Noodle Knockout Fine Motor Game.
They argue the tariffs implemented by Trump since his return to the White House have raised their costs and were carried out unlawfully without authorization by Congress.
“These tariffs threaten the very existence of small businesses like mine, making it difficult to survive, let alone grow,” says Victor Schwartz, the founder and president of V.O.S. Selections, a nearly 40-year-old New York City-based wine importer that is the lead challenger in one of the cases.
“I was shocked that those with much more power and money did not step up,” Schwartz adds. “So when I was afforded the opportunity to speak for small American business, I took it. I had to.”
The justices will hear arguments in Learning Resources Inc. v. Trump and Trump v. V.O.S. Selections Inc., and there is a lot at stake.
“We’re talking about hundreds of billions of dollars or more in tariffs,” University of Chicago law professor Curtis A. Bradley, an expert on foreign relations law, said at the law school’s Supreme Court term preview in September, adding that the Trump administration “may need to refund those billions of dollars if they lose in the Supreme Court.”
One interested party agrees about the high stakes of the tariff appeal going before the justices.
“I will tell you that’s one of the most important cases in the history of our country because if we don’t win that case, we will be a weakened, troubled, financial mess for many, many years to come,” Trump said at the White House on Oct. 15.
Learning Resources Inc. and hand2mind Inc. CEO Rick Woldenberg. (Photo courtesy of Learning Resources Inc.)President relies on 1977 emergency-powers law
The case involves three executive orders signed by Trump beginning early in his second term that increased tariffs on imported goods based on two “emergencies.” Two orders addressed the flow of fentanyl and other lethal drugs into the United States from countries such as Canada, Mexico, and China: Increased tariffs on those nations are meant to prod them to better address the problem.
A third involved the existence of longtime trade imbalances between the United States and many of its trading partners.
The “large and persistent annual U.S. goods trade deficits” have “atrophied” the nation’s “domestic production capacity,” one of Trump’s orders said.
The president relied on the International Emergency Economic Powers Act, a 1977 federal law that doesn’t mention “tariffs” or “duties.” But like a predecessor statute, it has language permitting the president to “regulate” importation and exportation. That language had been interpreted by a federal appellate court to retroactively validate temporary tariff surcharges imposed by President Richard M. Nixon in 1971.
Bradley says presidents have used that statute multiple times since the 1970s, “often in response to human rights abuses in other countries or conflicts in other countries … particularly national security threats like the Iran hostage crisis.”
In 1979, President Jimmy Carter froze the assets of Iran under the statute.
“We’ve had about 50 years of experience under IEEPA,” but it “has never—until now—been used to impose tariffs on imports,” Bradley says.
Trump has imposed a baseline, across-the-board tariff rate of 10% on all trading partners, as well as threatened additional country- and product-specific tariffs of 100% or more in some cases. Some tariffs have been stop-and-go amid trade negotiations.
While the business community generally has opposed the tariff push, it has been small to medium-size businesses that have pressed the legal challenges.
“It hurt small businesses much more,” says Jeffrey Schwab, senior counsel with the Liberty Justice Center, a legal organization based in Austin, Texas, that is behind the lawsuit filed by V.O.S. Selections. “Big businesses are much more able to [absorb] the tariffs and the costs.”
The challengers, which include 12 Democratic-leaning states who joined the V.O.S. Selections case, argue the president has no independent constitutional authority to impose tariffs and that neither an “emergency” nor any “unusual and extraordinary” threat exists to justify action under IEEPA.
“The president has important powers from the Constitution, but he has no power to impose taxes on American citizens without the authorization of Congress, and tariffs are taxes on American importers,” says Michael W. McConnell, a former federal appeals court judge and current Stanford Law School professor who is part of the legal team representing the V.O.S. Selections plaintiffs.
Another major argument of the challengers is that interpreting IEEPA to authorize the president’s tariffs violates the “major questions doctrine,” which suggests that Congress intends to decide major issues itself rather than delegating them to the executive branch.
In Biden v. Nebraska in 2023, the Supreme Court relied on the major questions doctrine to invalidate a plan by President Joe Biden’s administration to cancel some $430 billion in student loan debt.
Dan Epps, a professor at Washington University in St. Louis School of Law who is not involved in the tariffs case, said the Trump administration’s assertions of emergency power are similar to those raised by the Biden administration in the student loan case.
“If the court does uphold the tariffs, I think it will maybe reinforce some impressions that people in the public have that the court is applying different rules depending on who occupies the White House,” Epps said at a term preview in September sponsored by SCOTUSblog.
Administration’s brief takes on Trumpian tones
U.S. Solicitor General D. John Sauer, in his main brief defending the legality of Trump’s tariffs, told the court that the president has determined they “are necessary to rectify America’s country-killing trade deficits and to stem the flood of fentanyl and other lethal drugs across our borders.”
“To the president, these cases present a stark choice: With tariffs, we are a rich nation; without tariffs, we are a poor nation,” Sauer wrote, in what some observers perceive as a Trumpian turn of phrase.
Sauer argues that IEEPA’s references to regulating “importation” includes tariffs and that the major questions doctrine does not apply to the president’s tariffs in this context because, among other reasons, it does not apply in the national security context. (He cites a Justice Brett Kavanaugh concurrence making that point in a decision from last term that upheld the funding mechanism for the federal programs of telecommunications aid for schools, libraries and low-income consumers.)
The Trump administration has relatively thin support on its side in the form of amicus briefs compared with the challengers, but among those few backing its arguments is Chad Squitieri, an assistant professor of law at the Catholic University of America Columbus School of Law. He filed a brief arguing that courts should not require the president to go through the kinds of procedural hoops included in some other tariff statutes when dealing with emergency conditions contemplated by IEEPA.
“Right now, Congress has given a special and emergency power to the president,” Squitieri said on the American Compass podcast in September. “Yes, there’s other nonemergency powers that he could use, but he wants to use the emergency one because he’s declared an emergency.”
“It is relatively clear that the IEEPA statute does empower the president to impose the tariffs that are being challenged in these various litigations,” Squitieri said.
A much bigger tariff bill
The Trump tariffs raised some $195 billion in federal fiscal year 2025 (which began Oct. 1 of last year, months before Trump took office and imposed them), according to the Committee for a Responsible Federal Budget. That was about 250% more than what it collected in fiscal 2024.
Rick Woldenberg, the CEO of Learning Resources Inc. and hand2mind Inc., the two Vernon Hills, Illinois-based educational toy companies behind the other challenge being taken up by the high court, estimates that he will pay as much as $14 million in tariffs this year, up from $2.3 million last year. And that is after the companies shifted production out of China to other nations with lower Trump tariff rates where it also contracted for its products to be made, such as Vietnam.
Woldenberg says it feels like his companies have been “running a marathon for months and months and months.”
The president’s constantly changing tariff threats and rates are costing “a lot money. And It’s highly disruptive,” the CEO says. “We are trying to navigate … back to normal.”
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