The U.S. Supreme Court case Chicago Great Western Railway Company v. Kendall, Governor of the State of Iowa, et al., 1924 involved a dispute over taxation and regulation powers between states and interstate corporations. The Chicago Great Western Railway Company challenged an Iowa law that imposed taxes on its property within the state's borders, arguing it was unconstitutional as it violated the Commerce Clause by interfering with interstate commerce. However, the Supreme Court ruled in favor of Iowa stating that while states cannot regulate or tax activities beyond their boundaries or interfere directly with interstate commerce, they do have power to tax property within their jurisdiction even if used for interstate business purposes provided such taxation does not discriminate against out-of-state entities nor obstructs free flow of trade across state lines.

In the dissenting opinion for Chicago Great Western Railway Company v. Kendall, it was argued that the State of Iowa had no right to regulate interstate commerce rates, as this power is reserved exclusively for Congress under the Commerce Clause of the U.S. Constitution. The justice believed that allowing states to interfere in such matters would lead to a chaotic system where each state could set its own rules and regulations regarding interstate commerce, leading potentially to conflicting laws and confusion among businesses operating across state lines. Furthermore, he contended that if states were allowed such powers, they might use them unfairly or arbitrarily against out-of-state companies in favor of local ones - an outcome contrary to principles of free trade and fair competition enshrined in federal law.