In the case of Burlington Northern Railroad Co. v. Oklahoma Tax Commission et al., 1986, the U.S Supreme Court ruled in favor of Burlington Northern Railroad Company (BN). The dispute arose when BN challenged the state tax imposed by Oklahoma on its gross receipts from freight transportation services that both originated and terminated within the state but passed through other states en route. BN argued this violated federal law under 49 U.S.C §11503(b), which prohibits discriminatory taxation against railroads by states where a significant portion of their journey occurs outside said state's borders. The court agreed with BN, stating that while it is permissible for a state to tax activities occurring entirely within its boundaries, it cannot do so if those activities also occur significantly in other jurisdictions as well.

In the dissenting opinion for Burlington Northern Railroad Co. v. Oklahoma Tax Commission, Justice White argued that the Court's majority misinterpreted Congress' intent in passing the Railroad Revitalization and Regulatory Reform Act of 1976 (4-R Act). He contended that Congress intended to prevent discriminatory taxation against railroads but did not intend to exempt them from all state taxes. According to him, there was no evidence suggesting that Oklahoma's tax on diesel fuel used by rail carriers was discriminatory or unfair compared with other similar taxes imposed on non-railroad entities within the state. Therefore, he believed it should be upheld as constitutional under the 4-R Act. Furthermore, he criticized the majority for creating a new rule without clear statutory support and warned this could lead to unintended consequences such as encouraging states to impose more burdensome property taxes on railroads instead of less intrusive sales and use taxes.