## Facts

- Trojan Technologies, Inc., a Canadian manufacturer, sold an ultraviolet water-disinfection system (UV-2000) containing steel components not all made in the United States.
- Kappe Associates, Inc. served as Trojan’s exclusive distributor in Pennsylvania and marketed the UV-2000 to Pennsylvania municipal authorities for public wastewater projects.
- Pennsylvania’s Steel Products Procurement Act required steel products used in public-works projects by covered public agencies to be American-made, with remedies including recovery of payments and a five-year bidding bar for willful violations.
- In 1988, the Pennsylvania Attorney General determined the UV-2000 fell within the Act, requested documentation of American-made steel, and contacted municipal authorities about potential noncompliant purchases.
- Trojan and Kappe sued the Commonwealth and the Attorney General for declaratory and injunctive relief, challenging the Act’s validity as applied to their product.
- The district court granted summary judgment for the Commonwealth, rejecting challenges based on the Commerce Clause (including foreign commerce), preemption, foreign affairs, vagueness, and equal protection.

## Issues

1. Whether Pennsylvania’s buy-American steel requirement for public works is proprietary purchasing (market participation) or market regulation for dormant Commerce Clause purposes.
2. Whether the Act impermissibly burdens foreign commerce or intrudes on the federal government’s authority over foreign relations.
3. Whether federal statutes or executive agreements governing trade and procurement preempt the Act.
4. Whether the Act is unconstitutionally vague as to covered “steel products” and what it means for steel to be “produced in the United States.”
5. Whether the Act violates the Equal Protection Clause by discriminating against foreign or out-of-state economic actors.

## Decision

- The Third Circuit affirmed summary judgment for the Commonwealth and upheld the Steel Products Procurement Act.
- Pennsylvania was acting as a market participant by setting conditions on purchases for public works, placing the Act outside dormant Commerce Clause limits, including objections framed as foreign-commerce burdens.
- The Act was not preempted because the cited federal measures did not clearly displace state buy-American procurement requirements and did not directly conflict with the Act.
- The Act did not unconstitutionally interfere with federal foreign relations power because it governed state procurement rather than foreign trade policy and lacked a shown conflict with federal foreign-policy objectives.
- The Act was not void for vagueness because its definitions and operative requirements provided adequate notice and standards.
- The Act satisfied equal protection under rational-basis review because the procurement preference was rationally related to legitimate economic and employment interests.

## Legal Principles

- When a state sets terms for its own procurement, it acts as a market participant and generally is not subject to dormant Commerce Clause constraints applicable to market regulation.
- Incidental effects on foreign producers from state procurement preferences do not, without more, establish unconstitutional burdens on foreign commerce or an invalid intrusion into federal foreign relations authority.
- Preemption requires clear congressional displacement, a direct conflict, or frustration of identifiable federal objectives; absent such showings, state procurement preferences may coexist with federal trade-related measures.
- A statute is not unconstitutionally vague if it provides fair notice of prohibited or required conduct and sufficient standards for application, particularly in an economic-regulatory context.
- Economic classifications in procurement statutes are reviewed under rational-basis scrutiny and are valid if reasonably related to legitimate governmental interests.

## Conclusion

The Third Circuit held that Pennsylvania’s buy-American steel rule for public-works procurement operated as proprietary purchasing, not market regulation, and therefore survived challenges based on foreign commerce, federal foreign affairs authority, preemption, vagueness, and equal protection.


Trojan Techs., Inc. v. Pennsylvania, 916 F.2d 903 (3d Cir. 1990)