In the case of Chicago, Milwaukee, St. Paul & Pacific Railroad Co. v. Illinois et al., 1957, the U.S Supreme Court ruled in favor of the railroad company against a tax imposed by Illinois on its gross receipts from interstate transportation services. The court held that such a tax was unconstitutional as it violated the Commerce Clause of the Constitution which prohibits states from interfering with interstate commerce without congressional approval. The decision emphasized that while states have power to levy taxes for revenue purposes, they cannot do so in a way that discriminally burdens or impedes interstate commerce activities beyond their jurisdictional boundaries.

In the dissenting opinion for the case of Chicago, Milwaukee, St. Paul & Pacific Railroad Co. v. Illinois et al., Justice Frankfurter disagreed with the majority's decision that a state could not regulate rates charged by an interstate railroad company for intrastate commerce if it conflicted with federal regulation. He argued that this interpretation was inconsistent with previous court decisions and undermined states' rights to govern their own economic affairs in areas where Congress had not explicitly claimed authority. Furthermore, he contended that there was no evidence of such conflict between state and federal regulations in this particular case; therefore, Illinois should have been allowed to enforce its rate-setting laws without interference from federal authorities or courts.