A Latest York City wine importer, Victor Schwartz, took a significant risk and won a landmark case against the Trump administration at the Supreme Court. The court ruled, in a 6-3 decision, that President Trump’s use of the International Emergency Economic Powers Act to impose sweeping tariffs was unconstitutional. This ruling, which reverberated through financial markets and the White House, potentially impacts the roughly $175 billion in tariffs collected under that authority.
A Challenge to Presidential Authority
Schwartz, founder of VOS Selections, a wine and spirits import business established nearly 40 years ago, found himself at the center of the legal battle. The Liberty Justice Center, a Chicago-based constitutional law nonprofit, approached him in early 2025 seeking a plaintiff to challenge the tariffs. Schwartz initially hesitated, weighing the risks before deciding to proceed, stating, “I just felt like I had to do it. It was maybe the most important thing I could possibly do.”
Tariff “Chaos” and Business Impact
The tariffs, initially manageable in 2019, escalated into what Schwartz described as “absolute chaos” as they were applied and removed seemingly at random. VOS Selections, which operates with approximately 20 employees and partners with vineyards in 16 countries across five continents, faced a nearly 30% increase in costs. Schwartz absorbed some of the cost by cutting inventory and delaying new product launches.
The Road to the Supreme Court
The Liberty Justice Center argued that the tariffs were unconstitutional because the administration’s justification – boosting domestic manufacturing – didn’t apply to imported goods like wine. “How do you manufacture Spanish wine in the United States?” asked Sara Albrecht of the Liberty Justice Center. The case moved quickly through the courts, reaching the Supreme Court on an expedited basis. Schwartz attended every hearing, describing the courtroom as a space that conveyed “the weight of the importance of law.”
An Incomplete Victory
While the Supreme Court ruled in Schwartz’s favor on February 20, the decision did not include a mechanism for businesses to recoup the $175 billion in tariffs collected. The Liberty Justice Center has filed motions to initiate a refund process, but the timeline for potential restitution remains unclear. President Trump has already implemented a new set of tariffs under a different legal authority. “I mean the reality is we’re exactly in the same place,” Schwartz said, “in terms of running my business every day.”
Frequently Asked Questions
What was the central argument of the case?
The Liberty Justice Center argued that President Trump’s use of the International Emergency Economic Powers Act to levy tariffs was unconstitutional, specifically because the justification of boosting domestic manufacturing did not apply to imported goods.
How did the tariffs impact businesses in New York City?
The Manhattan Chamber of Commerce estimated that small businesses in the New York City metro area absorbed approximately $4.5 billion annually in added tariff costs, and 5,000 businesses closed when the tariffs were fully implemented in the second quarter of 2025.
What happens next regarding the tariffs?
The Liberty Justice Center is pushing for a refund process for the $175 billion in tariffs collected, but there is no clear timeline for when, or if, that money will be returned to businesses. President Trump has also signed a new suite of tariffs under a different legal authority.
Given the complexities of the legal process and the implementation of new tariffs, what will it take for small businesses to achieve lasting relief from trade-related financial burdens?
