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Vernon Hills toy co. awaits SCOTUS opinion
From that courtroom fight to one tied to the holidays, a toy company in Vernon Hills is waiting to hear from the Supreme Court. They’re challenging the Trump administration’s tariffs and the decision could hit right as shoppers start buying gifts.
VERNON HILLS, Ill. - A Vernon Hills toy company is anxiously awaiting the U.S. Supreme Court’s decision in its case against the Trump administration. The family-owned business is fighting the sweeping tariffs enacted earlier this year — trade policies that have reshaped the economy.
SCOTUS heard oral arguments in the case in early November, just as companies nationwide are preparing for the first holiday season since the far-reaching tariffs took effect.
What we know:
Based in Vernon Hills, the company suing President Donald Trump over the tariffs houses several educational toy brands, including Learning Resources and hand2mind.
It may take several more months for SCOTUS's opinion to be issued. If they rule in favor of the toy company, their business and others could be owed millions of dollars by the U.S. government.
"The main thing the justices were asking about was the Separation of Powers issue, because that's what this case is. Does taxation belong to Congress, or does Congress have the ability to delegate that authority to the executive branch with essentially no limits? That is what the administration has been asserting," said Elana Ruffman, VP of marketing & product development with hand2mind.
Since the tariffs were imposed, the company has had to drastically change where and how it manufactures its products. The shift has also shortened its purchasing window — instead of buying nine months out, they’re now placing orders just three months ahead.
"When the tariffs started rolling out in large forms in April, we were actually already starting to manufacture next year's holiday toys, which is why the timing of it was so disruptive," Ruffman said.
When the Supreme Court listened to their case, Ruffman and her family were there for the once-in-a-lifetime experience.
"The Supreme Court acknowledges that it's such a significant case and that's because of the economic implications. It's $50 billion a month that's at stake that the government is collecting in tariff revenue," Ruffman said. "It's a privilege to be in a place where we're allowed to raise our hands and say, we think this isn't right, and to see that get adjudicated in front of the most significant court in the country is a real honor."
Ruffman said the family-owned business spent roughly $2 million on tariffs last year, but this year they’re on track to spend $14 million.
Still, she says the company has worked hard to avoid passing those costs onto consumers.
Dig deeper:
With Black Friday just one week away and holiday shopping on everyone’s mind, Jean-Pierre Dube — a professor at the University of Chicago Booth School of Business — is sharing his take on what to expect.
"I think the big question mark really is going to rely on how big the inventories are that retailers accumulated this year," Dube explained.
The marketing expert shared that Black Friday is not always the best time to buy.
"There's just such a predictable jump in people who assume there's going to be deals, that retailers have had a somewhat unsavory habit of making those deals not as good as we think," Dube said.
Dube anticipates we might see better deals next month.
"If there's a lot of inventory, we're going to see some fantastic deals between now and Christmas," he said.
Plus, he predicts that people may splurge this holiday season despite a year of saving and spending more frugally.
"In periods where people feel that their budgets are pinched, your instant reaction is to think they’re going to be very careful, and that would make you assume it’s going to be more necessity driven. But it can also go the other way — people have been so frugal that they feel they’ve licensed themselves to splurge, and they can surprise you and suddenly buy, especially if there's a deal associated with it, something that seems more frivolous because they owe it to themselves or they owe to their kids or their family to do something fun," Dube explained.
What's next:
SCOTUS is expected to issue its written opinion on Learning Resources, Inc.'s case in the coming months. Ruffman says even if the decision is made in their favor, it could take several years to rectify the situation.
The Source: This story contains reporting from Fox 32's Kasey Chronis.