In the case of Alaska v. Arctic Maid et al., 1960, the Supreme Court ruled in favor of Arctic Maid and other fishing companies. The state of Alaska had imposed a tax on fish caught by these companies outside its territorial waters but processed within it. The court held that this was unconstitutional as it violated the Commerce Clause which gives Congress exclusive power over interstate commerce. It stated that while states can impose taxes for services provided, they cannot do so when no such services are rendered or if those services have no connection to activities conducted within their jurisdiction. In this case, since the fish were caught outside Alaskan waters, there was no justification for imposing a tax on them even though they were processed in-state.

In the dissenting opinion for Alaska v. Arctic Maid et al., Justice Frankfurter disagreed with the majority's decision that Alaska, as a territory at the time of litigation, did not have jurisdiction to tax salmon canneries operating in its waters. He argued that Congress had given territories broad powers to govern themselves and manage their resources under the Organic Act of 1884. This included taxing businesses within their borders. The majority’s interpretation was inconsistent with this congressional intent and undermined territorial self-governance by denying them an important source of revenue: taxes on natural resource extraction industries like fishing or mining which are often major parts of such economies. Furthermore, he contended that there were no constitutional barriers preventing territories from imposing these types of taxes because they do not interfere with federal interests or rights protected by other provisions in U.S law.