In the case of City of Cincinnati v. Louisville & Nashville Railroad Co., 1911, the Supreme Court ruled in favor of the railroad company. The city had attempted to impose a tax on all freight passing through its limits, regardless if it was destined for locations within or outside Cincinnati. The court found this tax unconstitutional as it interfered with interstate commerce and violated federal law which prohibits states from imposing taxes that discriminate against out-of-state businesses or transactions. This ruling reinforced the principle that state and local governments cannot interfere with interstate commerce, a power reserved exclusively for Congress under the Commerce Clause of the U.S Constitution.

The dissenting opinion in the case of CITY OF CINCINNATI v. LOUISVILLE & NASHVILLE RAILROAD CO., 1911, argued that the city had a right to impose taxes on railroad companies operating within its jurisdiction. The justices contended that railroads were not exempt from local taxation simply because they engaged in interstate commerce. They believed this was a matter of state rights and that federal interference was unwarranted. Furthermore, they disagreed with the majority's interpretation of 'commerce' under the Commerce Clause, arguing it should be understood more broadly to include all business activities rather than just trade or transportation between states. This broader understanding would allow for local taxation without violating constitutional principles.