How Victor took on the US president – and blew up Trump's plans to tax the world

Sydney Morning Herald

2 days ago

A global business
V.O.S. Selections has 19 employees and imports wines, spirits and sakes from 16 countries, including Italy, France and South Africa. Trump's tariffs would leave the company unable to plan import orders, and its relationships with wholesale customers and farmers who produce wine would suffer, Schwartz said in a declaration to the trade court.
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Eventually, he wrote, the business could become untenable.
'We have to come up with this cash flow somehow. That's not a little bit of money – that's thousands and thousands of dollars on each container,' Schwartz said. 'It's not a small thing. It's not easy. You can't absorb it if you're a small company.'
And the wine his company imports is valuable in part because of the characteristics imparted by growing certain grape varietals in specific areas.
'A popular wine like chianti cannot be replicated domestically because the raw ingredients only exist in that specific geographical location in Tuscany, Italy, and the wine can only be raised in the specific climate of that place to produce the qualities that a customer seeks when buying a bottle of said wine,' Schwartz said in his court filing.
The broader wine industry has similar concerns. The National Association of Wine Retailers urged the Trump administration to reconsider the sweeping tariffs in an April statement, noting that wine importers, wine wholesalers, wine retailers and domestic wine producers would suffer 'significant revenue reductions, lay-offs, and business closings'.
But in its filing to the Court of International Trade, which has exclusive jurisdictional authority over such disputes, the Trump administration called the claims of harm 'speculative', writing that they only show the 'possibility' of future economic loss.
The government argued that Trump has the authority to impose broad tariffs on imported goods under the 1977 International Emergency Economic Powers Act to reverse trade deficits it sees as a national emergency. They said the law's language authorising the president to 'regulate … importation' granted him full powers over tariff rates.
But the trade court's three-judge panel disagreed: 'The court does not read IEEPA to confer such unbounded authority,' the judges wrote in their decision on Wednesday, adding that the administration's justifications failed to meet the law's requirement that it be used to 'deal with an unusual and extraordinary threat'.
Unexpected costs loom
Earlier this year, Schwartz was connected to the Liberty Justice Centre, a nonpartisan group in Austin, Texas, after sharing the tariffs' impact on his business with his nephew's former law professor, Ilya Somin, who is also co-counsel on the case before the Court of International Trade.
When Schwartz was asked if he wanted to become the lead plaintiff in the lawsuit, he discussed the decision with his family. They convinced him he needed to take the leap.
'Everyone is very afraid of this person, so no one will step up,' Schwartz said of Trump. 'I can't complain about other people not stepping up. It was right at my plate, and I had to do it.'
But the effect of Trump's tariffs extends far beyond the wine industry, including to clothing brands such as Terry Precision Cycling, a business that specialises in women's cycling attire and is a co-plaintiff in the lawsuit.
The Vermont-based brand imports fabrics and finished goods from several countries, including Guatemala, China and the Philippines. It paid $25,000 in unplanned tariffs in 2025 and expects to pay an additional $250,000 in tariffs by the end of the year, according to court documents. Terry Precision Cycling will face an estimated $1.2 million in tariff costs in 2026 – 'which it will not be able to pay'.
That sentiment is reflected across nearly a dozen small businesses spanning the clothing, gaming and mechanical industries that filed a brief in support of the plaintiffs in the lawsuit. All but one directly import goods from abroad, and some have already paid additional tariffs under Trump's trade war policy.
The companies said that 'sudden and dramatic increases in tariff amounts, together with the uncertainty of an ever-changing policy, threaten immediate and existential harm' to their continued operation. They added that tariffs made it 'all but impossible to plan', and that switching to fully domestic manufacturing would 'take many years'.
The court decisions this week have provoked strong reactions from the White House. Shortly after the trade court blocked the new tariffs, Trump adviser Stephen Miller wrote on X, 'We are living under a judicial tyranny.'
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Trump celebrated the temporary stay delivered by the federal appeals court on Thursday (Friday AEST) in a post on Truth Social, calling the tariffs 'desperately needed', and calling the trade court 'so wrong, and so political!'
The appeals court is expected to issue a ruling on whether to pause the tariffs while it hears the case some time within the next two weeks, Liberty Justice Centre senior counsel and interim director of litigation Jeffrey Schwab said.