Learning Resources
- Rick Woldenberg scrapped a 600,000 square foot building project for his business due to tariffs.Woldenberg is petitioning the Supreme Court to hear his lawsuit against Trump's tariffs.Woldenberg's business is in a soft hiring freeze, and it has paused most overseas ventures.
This as-told-to essay is based on a conversation with Rick Woldenberg, CEO of Learning Resources, an educational toy company based in Illinois. He is petitioning the Supreme Court to hear his lawsuit against Trump's tariffs. This essay has been edited for length and clarity.
I was in the middle of a deal I had been working on for two years to build a very large building over 600,000 square feet for our business, and I canceled that project on April 2 after I heard about the tariffs.
We make educational products for young children to help them get a great start in life. We're a fourth-generation family business with roots that go back a hundred years in northern Illinois, and we have a staff of over 500 people. We also export out of this country to over a hundred countries.
We filed the lawsuit in the District Court of Columbia, and we are now petitioning the Supreme Court all on our own money because this is an emergency. The financial burden of these tariffs and the disruption in our business are catastrophic.
Treasury Secretary Scott Bessent said on TV that they expect to raise $600 billion a year with this invisible tax increase. That's $50 billion a month from us and from other companies like us, and ultimately, from US consumers. Time is of the essence here.
'It's tariffs all the time'
Somebody said to me at our company, "It's tariffs all the time."
For months, we have dozens of people working full-time or part-time on addressing all aspects of the tariffs. You can hardly imagine anything more disruptive.
Our supply chain coming into the year was about 60% China, and we also source in Vietnam, India, Korea, Taiwan, and Thailand. We make some things in the US, and we do assembly in the US. We also develop our products in the US, where we own the intellectual property.
We outsource the manufacturing and devote the capital that we have to developing factories, financing our inventory, receivables, marketing, capital expenditures, and creating jobs. So our dollars go further because we are able to tap into businesses that are very focused on being outstanding manufacturers who are essentially our partners.
But since the tariffs, there are no rules, or they change three times a week. We don't know what our costs are, and we are generally given 36 hours of advance notice to change how we operate our business. We have to dismantle a 40-year-old supply chain. There are tremendous amounts of costs associated with that, which are not recoverable in any way, shape, or form.
It's not just inconvenient — it's making it extremely difficult to run our business in any coherent fashion.
Tariffs have disrupted all plans
Learning Resources
The day I heard about the tariffs on April 2, I called my broker, and I killed my building deal.
Our business is located north of O'Hare Airport in the Chicago area. We're in Vernon Hills, and we were going to reorganize some of our office and warehouse space and consolidate some of our buildings into this brand new building for greater efficiency and to hold more inventory.
The building does not exist — we were going to develop it. It was going to be not only a major investment by our business, but it was going to involve a very large investment in technology because we run a very high-tech fulfillment operation. It would create jobs here in Vernon Hills, and it would help us extend the life of our investment three more decades at least.
This is the contrary of what the government says they're trying to achieve. They're trying to get people to invest more in this country, and this a pretty big investment that they completely screwed up. Maybe someday we'll be able to do it again, but right now the project is dead.
On top of that, we have essentially a soft hiring freeze. On April 2, I also killed a joint venture in India because we were just too strained by the tariffs. We've sharply cut our out-of-pocket expenditures in all parts of the business. We're clinging to dollar bills because we don't know when the government is going to take them away from us.
We pay a lot of real estate taxes. We support the local schools, the local fire department, and the local police department, and we do business with companies in our area. There are literally millions of children globally who use our product every year to help them learn basic skills from 18 months to eighth grade. A lot of people depend on us for their livelihoods.
That's why we sued, and that's why we're pursuing this as an urgent matter, because we're going to fight for what we've built.
