This small-toy company CEO took on Trump’s tariffs… and WON

[00:00:00] Speaker 1: When President Trump launched his trade wars last year, he got relatively little pushback from the private sector, even as companies buckled under the weight of his tariffs. But a few smaller businesses did fight back and helped take Trump's tariffs down. One was a small Chicago-based toy company called Learning Resources. Its CEO and owner, Rick Waldenberg, was one of the first business leaders to take Trump to court over his tariffs last April. And Waldenberg's gambit has paid off. The Supreme Court ruled in his favor yesterday, issuing a rebuke to Trump. And now Waldenberg's toy company could be entitled to a share of billions of dollars in refunds. Rick Waldenberg, CEO and chairman of Learning Resources, joins us now. Rick, congrats on your win. Thank you. My first question to you is, how much does the government owe you in refunds at this point? And what do you plan to do with your winnings? [00:00:53] Rick: Well, they owe us more than $10 million. That's how much we spent last year. There was more spent this year. And we'll put it to good use. If you give us money, we're going to spend it on our business. We'll hire people. We'll invest in CapEx. We'll have new marketing programs. We'll develop more products. It will be put to good use. And we can't wait to spend it. [00:01:15] Speaker 3: Rick, there are so many huge, massive, billion-dollar corporations that chose not to stand up and try to get the money that the government was taking for them. And you, I think, very admirably said, I'm going to sue for my $10 million and against these tariffs, these new taxes. What motivated you to actually step up and take on the U.S. government? [00:01:41] Rick: Well, I think that as a multi-generational family business and as a mission-driven business, we attach a great deal of significance and derive a sense of meaning and purpose from what we do. I'm also very motivated by the fact that we have about 500 employees, including full-time equivalents, and their families come to our company for their livelihood. Somebody needs to stand up for all of this. And I just didn't want a politician to ruin it. We've worked for a long, long time to create an organization that can add value like this. And I just wasn't going to stand idly by and let it be ruined. [00:02:22] Speaker 4: Well, for employees like yours, they're being squeezed because they're the place where they work. The company that they've invested their time and their career in is getting squeezed. But then also just as consumers, people who have to go out into the market and try to go get goods and are seeing the increased cost of living, they're dealing with it on that end, too. And I'm curious what you would say to the administration at a time when we're starting to hear less about the $2,000 checks Americans thought they might get as a result of all of this. You know, at one point, the administration was on the airwaves telling people that this was going to come, that it was going to feel like your tax season refund. And now we're not hearing a whole lot about that, of course. And so I think people are feeling like on an individual level, they've lost no matter what. [00:03:07] Rick: It's been an unfortunate situation to be put in. You know, when you make educational products, one of your missions is to make sure that the products are accessible to every child that needs them. Our tax rate last year was over 100%. So if you add a Fed, state and IEPA tariffs, it was over 100%. Make a dollar, pay more than a dollar in taxes. We were unable to sustain that burden without a small price increase. And we took the absolute least that we could, but it was mid-single digits. Towards the latter half of last year, we decided that we needed to act consistent with our view. And we took the view that the IEPA tariffs would be rebated. And so we elected, notwithstanding inflation, to not have a price increase for 2026. And it's our goal to work the price down. With the new tariffs imposed on us yesterday and again today, we're kind of back where we were, which is unfortunate. But we're still going to ride this out as long as we can and try and reduce prices for consumers. [00:04:13] Speaker 5: So, Rick, how has this been for you personally over the course of the last year? I mean, we live in a hyper-polarized political world, and there were people who were defending these tariffs, and there were people who were attacking those who were trying to say these tariffs were unconstitutional. I'm just wondering if you can tell us a little bit about your personal experience over the course of the last year and what that's been like you, and did you ever have any doubt seeing all the criticism and the noise that was perhaps directed at people who said those that are critical of this were un-American or that the administration was standing up for, you know, American companies and trying to bring jobs back here and all that narrative and all that noise that was pushed out by the administration and its allies? [00:04:56] Rick: No, I've never had any doubt. I always knew why we were doing this, and so it was purposeful, and I was very focused. As a personal journey, you know, you can't pay for a ride like this at Disneyland. It's been, it's had its ups and downs, but we believe that, like, we're on the right side of history here. We've tried not to let this case be political. It is not political. We're not a political organization. The law was on, the law was being used unconstitutionally, and we knew we were right. But we're also standing with rule of law, and we're defending our form of government, which is an invention of James Madison and something that I greatly admire. And so we get a lot of sustenance from defending what I think is foundational in American life, and we're proud of standing with that. [00:05:51] Speaker 1: Rick, one question that I have had basically for the past year is why there has been so little pushback from much of the private sector over policies like this, particularly from larger companies that also presumably had to pay tariff bills or at least have been affected by much of the erratic policymaking and uncertainty coming from this administration. Why do you think it is that it took a small business like yours to be among the first to fight back, whereas some of the larger companies out there have been relatively quiet? Do you have, just do you have any theories about why it is that smaller businesses, smaller companies seem to be leading the way in terms of having a backbone and standing up to what you see as unconstitutional behavior? [00:06:48] Rick: Well, as a private, small, as a family business, a private business, we don't answer to anyone except the bank. And if the bank is okay with it and we're okay with it, we can do that. I think that, you know, when you face a crisis, a lot of people say somebody should do something about this, but I'm too busy or whatever it happens to be. I think the real challenge for all of us when we face a crisis is how do you know who else is in line? How do you know if, like, you're the last one in line or you're the only one in line? It's very difficult. In our case, I felt that the risk of inactivity was far greater than the risk of pursuing our rights. [00:07:34] Speaker 4: Rick Woldenberg, thank you so much for sharing some of your story with us. We appreciate you. [00:07:39] Speaker 1: Thank you.