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Constitutional Law Keyed to Choper
Reeves, Inc. v. Stake
Citation:
65 L. Ed. 2d 244 (1980)Facts
In 1919, South Dakota established a state-owned cement plant in response to regional cement shortages that were disrupting both public and private construction projects. The plant, located in Rapid City, soon produced more cement than South Dakotans could use, and over the years, buyers in at least nine nearby states purchased cement from the plant. Between 1970 and 1977, approximately 40% of the plant’s output went to out-of-state buyers. Reeves, Inc., a Wyoming ready-mix concrete distributor, had purchased about 95% of its cement from the South Dakota plant since beginning operations in 1958. As the 1978 construction season approached, production difficulties at the plant coincided with booming regional and national construction demand, creating a cement shortage. The South Dakota Cement Commission responded by implementing a policy to supply all South Dakota customers first, honor existing contract commitments, and allocate remaining cement on a first-come, first-served basis. Reeves, which had no long-term supply contract, was informed on June 30, 1978, that the plant could not continue to fill its orders. Unable to find another supplier, Reeves was forced to cut production by 76%.
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