Reeves, Inc. v. Stake

The State of South Dakota built a cement plant in response to cement shortages within the state. The Commission concluded that all of the cement produced would be needed inside the state. Nevertheless, the plant’s output exceeded South Dakota customers’ needs for many years, and the plant was able to supply cement to both in-state and out-of-state contractors. Later, a boom in the construction industry coincided with internal difficulties at the plant. As a result, the plant was unable to fill all of its cement orders. To combat this problem, the Commission reaffirmed that the plant should preferentially supply cement to South Dakota contractors first before filling orders with out-of-state contractors. Reeves, Inc. (Reeves) was an out-of-state contractor who suffered serious financial harm when the plant stopped filling its orders. Reeves sued in district court, challenging the state’s cement sales policy. Reeves argued that the policy unconstitutionally discriminated against interstate commerce in violation of the Dormant Commerce Clause.