In the case of Allied Stores of Ohio, Inc. v. Bowers, Tax Commissioner of Ohio in 1958, the U.S Supreme Court ruled on a dispute regarding state taxation policy. The issue at hand was whether or not it was constitutional for the State of Ohio to impose an ad valorem personal property tax on inventory held within the state by a non-resident corporation for sale and delivery outside the state. Allied Stores argued that this practice violated both Due Process Clause and Commerce Clause rights under federal law as it amounted to extraterritorial taxation. The court upheld Ohio's right to levy such taxes with Justice Brennan delivering majority opinion stating that there is no violation in taxing goods destined for out-of-state shipment while they are still physically located within its borders because ownership remains vested in owner who retains control over them until their actual shipment.

In the dissenting opinion for Allied Stores of Ohio, Inc., v. Bowers, Tax Commissioner of Ohio, Justice Brennan argued that the tax imposed by Ohio on out-of-state corporations was unconstitutional. He contended that it violated both the Due Process and Commerce Clauses of the Constitution because it discriminated against interstate commerce. The tax was levied based on gross receipts from sales made in other states but delivered to customers in Ohio; however, no such tax applied to similar transactions conducted entirely within state borders. This discrepancy created an unfair burden on interstate businesses which were taxed more heavily than their intrastate counterparts solely due to their participation in interstate commerce - a clear violation according to Justice Brennan's interpretation of constitutional law.