In the case of Armco Inc. v. Hardesty, Tax Commissioner of West Virginia (1983), the U.S Supreme Court ruled in favor of Armco Inc., a steel manufacturer based outside West Virginia that sold its products to independent contractors within the state. The court held that it was unconstitutional for West Virginia to impose a tax on these sales while exempting similar transactions involving local manufacturers from taxation under its "use tax" law. This decision was based on the Commerce Clause, which prohibits states from discriminating against interstate commerce or giving preferential treatment to in-state businesses over out-of-state ones without sufficient justification. The court found no such justification and therefore concluded that this differential treatment violated the principle of fair competition enshrined in federal law.

The dissenting opinion in the case of Armco Inc. v. Hardesty, Tax Commissioner of West Virginia argued that the majority's decision was inconsistent with prior rulings and misinterpreted the Commerce Clause of the U.S Constitution. The dissenters believed that West Virginia’s tax did not discriminate against interstate commerce as it applied equally to both local and out-of-state businesses involved in wholesaling activities within its borders. They further contended that any differential treatment arose from differences between wholesale and retail transactions rather than discrimination against interstate commerce, which they felt was a legitimate distinction for a state to make under its taxing authority. Additionally, they disagreed with the majority's assertion that this case paralleled other cases where taxes were struck down due to their discriminatory nature; instead, they saw significant differences in context and application.