In the 1988 case of Amerada Hess Corp. et al. v. Director, Division of Taxation, New Jersey Department of the Treasury, the U.S Supreme Court ruled in favor of Amerada Hess Corporation and other oil companies who argued that they were being unfairly taxed by New Jersey's "Petroleum Products Gross Receipts Tax." The tax was levied on petroleum products refined outside but sold within New Jersey state lines. The court held that this taxation violated the Commerce Clause as it discriminated against interstate commerce because it imposed a higher tax burden on out-of-state refineries than those located within its borders. Therefore, such a discriminatory tax structure was deemed unconstitutional under federal law which seeks to maintain an open national market free from economic protectionism among states.

In the dissenting opinion for Amerada Hess Corp. v. Director, Division of Taxation, New Jersey Department of the Treasury, Justice O'Connor argued that the majority's decision to uphold New Jersey's tax on multinational corporations was inconsistent with previous rulings and violated principles of fairness in taxation. She contended that by taxing income earned outside its borders, New Jersey had exceeded its jurisdictional reach and infringed upon federal authority over foreign commerce. Furthermore, she criticized the majority for failing to apply a rigorous internal consistency test which would have shown that if every state adopted similar taxes it could lead to multiple taxation on corporations' foreign-source income - an outcome contrary to established precedent aimed at preventing such double-taxation scenarios.