## Facts

- Frank J. Lucchino, Controller of Allegheny County, filed a petition in the Commonwealth Court of Pennsylvania under the Pennsylvania Trade Practices Act (PTPA), 71 P.S. §§ 773.101–773.113, seeking a “determination of discrimination” against the foreign countries of Brazil, South Korea, Spain, Mexico, and Argentina.
- The PTPA authorizes the Commonwealth Court to decide whether a named foreign country “discriminates” against Pennsylvania steel or aluminum products and, upon such a finding, to place the country and specified products on the statute’s “foreign registry docket,” which triggers restrictions on the use of those foreign steel and aluminum products in Pennsylvania public works.
- Lucchino relied on federal trade materials, including determinations by the International Trade Administration that Mexico conferred benefits and subsidized the manufacture of steel and aluminum products in Mexico, and argued those practices disadvantaged Pennsylvania producers.
- Mexico was the only respondent to appear and filed a motion to dismiss.
- Mexico argued that the petition was barred by sovereign immunity under the Foreign Sovereign Immunities Act of 1976 (FSIA) because the alleged conduct involved governmental policy choices rather than “commercial activity.”
- Mexico also argued that the act-of-state doctrine deprived the court of jurisdiction because the petition required the court to pass judgment on sovereign acts taken within Mexico’s territory.
- Lucchino responded that the FSIA’s commercial-activity exception, 28 U.S.C. § 1605(a)(2), applied because the challenged conduct related to Mexico’s participation in the steel and aluminum market and had effects in the United States.
- The Commonwealth Court held a hearing and considered evidence on both Mexico’s defenses and whether the respondent countries’ practices met the PTPA’s definition of “discrimination.”

## Issues

1. Whether the FSIA required dismissal of the PTPA petition against Mexico, or whether an exception to immunity—particularly the commercial-activity exception—permitted the Commonwealth Court to proceed.
2. Whether the act-of-state doctrine barred the Commonwealth Court from determining that Mexico’s (and the other respondent countries’) trade practices constituted “discrimination” under the PTPA and from issuing the statutory registry-related relief.
3. Whether the evidence supported a determination that the respondent foreign countries “discriminated” against Pennsylvania’s steel and aluminum industries within the meaning of the PTPA, warranting placement on the foreign registry docket and the resulting public-works purchasing restrictions.

## Decision

- The Commonwealth Court denied Mexico’s motion to dismiss.
- The court rejected Mexico’s claim of immunity under the FSIA and concluded the proceeding could go forward.
- The court held that the act-of-state doctrine did not prevent the court from making a discrimination determination for purposes of Pennsylvania’s procurement statute.
- On the merits, the court determined that the respondent foreign countries had discriminated against Pennsylvania’s steel and aluminum industries under the PTPA.
- The court directed that the respondent countries and the specified foreign steel and aluminum products be placed on the PTPA foreign registry docket, triggering the statute’s restrictions on their use in Pennsylvania public works.

## Legal Principles

- The FSIA governs when a foreign state is immune from suit in United States courts, including state courts, and its exceptions define when a court may exercise jurisdiction over a foreign state.
- Conduct by a foreign state connected to participation in the marketplace for goods may fall within the FSIA’s commercial-activity framework, depending on the nature of the acts and their connection to the United States as set out in 28 U.S.C. § 1605(a)(2).
- The act-of-state doctrine generally prevents courts from declaring invalid a foreign sovereign’s public acts performed within its own territory; it does not bar a court from applying domestic law where the court is not asked to nullify the foreign sovereign’s acts, but to determine the domestic legal consequences of those acts under a Pennsylvania statute.
- Under the PTPA, once the Commonwealth Court makes a “determination of discrimination,” the statute provides for entry on a foreign registry docket and imposes limitations on Pennsylvania public agencies’ specification, purchase, or use of covered foreign steel and aluminum products in public works.

## Conclusion

In Lucchino v. Foreign Countries of Brazil, et al., the Commonwealth Court of Pennsylvania denied Mexico’s motion to dismiss based on FSIA sovereign immunity and the act-of-state doctrine, then concluded on the evidentiary record that Mexico and the other named foreign countries discriminated against Pennsylvania’s steel and aluminum industries under the Pennsylvania Trade Practices Act and ordered the countries and specified products placed on the foreign registry docket, triggering statutory public-works procurement restrictions.


Lucchino v. Foreign Countries of Brazil, et al., 476 A.2d 1369 (1984)