Spray Foam Producer Challenges California’s Compelled Research Funding

A producer of spray polyurethane foam is mounting a constitutional challenge to a California Department of Toxic Substances Control (DTSC) action requiring the company to fund research into replacement technology.

At issue is a DTSC determination requiring producers of spray foam to pay two cents for every pound sold in California into a fund supporting a green research grant. According to the plaintiff, Quadrant Performance Materials, the grant may be used either to develop spray foam containing less unreacted methylene diphenyl diisocyanates (MDI) or to reengineer the tools used to apply spray foam to reduce MDI exposures.

In a complaint filed September 21, 2026, Quadrant says it cannot conduct its own research with the grant money, is ineligible to receive a grant, has no say in what or how the recipient conducts its research, and has no right to use or profit from any resulting innovation.

“DTSC has left Quadrant with a Hobson’s choice: fund research aimed at replacing its own product—using methods and assumptions it has no control over, and that could put it out of business—or stop selling spray foam in California,” the complaint states.

Quadrant alleges that the requirement violates the First Amendment because it compels the company to subsidize speech and research with which it disagrees. It also alleges violations of the dormant Commerce Clause and Import-Export Clause, contending that the requirement unlawfully burdens interstate commerce and imposes a duty on goods brought into California from other states.

Regulatory Background

The lawsuit arises under California’s Safer Consumer Products Program (SCP), which allows DTSC to regulate “priority products” containing “candidate chemicals.”

MDI is one such candidate chemical. In 2014, DTSC identified spray foam products containing MDI as a priority product based on concerns that unreacted MDI in spray foam might cause workplace asthma. Quadrant, however, states that “DTSC has never identified a single person” harmed by spray foam products in the state.

According to the complaint, Quadrant submitted an abridged alternatives analysis to DTSC in 2025 that did not identify any feasible alternatives. In May 2026, DTSC issued a final determination imposing requirements on the continued sale of spray foam containing MDI in California. In addition to the green research fund fees, those requirements include labeling and training provisions that Quadrant does not challenge in the lawsuit.

The two-cent-per-pound fee is required from all spray foam producers for five years or until DTSC collectively receives $4 million, whichever occurs later. Based on its sales, Quadrant expects to pay approximately $10,000 into the fund each quarter.

Constitutional Claims

Quadrant seeks declaratory and injunctive relief based on three constitutional claims.

First, Quadrant argues that the fee violates the First Amendment because it forces the company to subsidize speech to which it objects. Quadrant contends that the research funded by the fees is not “neutral, disinterested science” because DTSC “has predetermined its premises and its objective.”

“DTSC, without substantiation, asserts that Quadrant’s product is harmful; the research being funded is attempting to find a replacement for MDI which Quadrant maintains does not exist or is not feasible; and California requires that this research uses green chemistry and/or green engineering principles,” the complaint states.

Quadrant further argues that the fee does not fall within exceptions for compelled funding of government speech or comprehensive regulatory schemes. Among other things, it points to the fact that the research fund is administered by a third party rather than DTSC.

Second, Quadrant argues that the requirement violates the dormant Commerce Clause by placing an excessive burden on interstate commerce. Citing Pike v. Bruce Church, Inc., Quadrant asserts that the scheme’s burdens on interstate commerce exceed its putative local benefits. Quadrant and “virtually all” other spray foam manufacturers operate outside California, the complaint states, meaning the requirement’s practical effects fall “almost entirely on interstate commerce.”

By contrast, the lawsuit alleges that the requirement’s asserted benefits are speculative because there is no guarantee that any funded project will succeed, become commercially viable, or ultimately be made available to manufacturers. “California has therefore imposed present burdens on interstate commerce in exchange for uncertain future benefits that will likely never materialize,” Quadrant states.

Third, Quadrant alleges that the scheme violates the Import-Export Clause because it imposes duties on goods imported from other states without congressional consent. The complaint acknowledges that the Supreme Court has held that the clause applies only to imports from foreign countries, but argues that it should be interpreted more broadly.

The case is Quadrant Performance Materials, LLC v. Butler, No. 2:26-cv-10704 (C.D. Cal.), filed September 21, 2026.