The U.S. Supreme Court case Container Corporation of America v. Franchise Tax Board in 1982 dealt with the issue of state taxation and its relation to interstate commerce. The court had to decide whether California's method for taxing multinational corporations violated the Commerce Clause, which prohibits states from passing laws that could negatively impact interstate trade. The Container Corporation of America argued that California's formula unfairly taxed them on income earned outside the state, thereby hindering their ability to conduct business across state lines. However, the Supreme Court ruled in favor of California’s Franchise Tax Board by a vote of 6-3, stating that there was no violation against the Commerce Clause or Due Process Clause as claimed by Container Corp., because it did not create an undue burden on interstate commerce nor was it fundamentally unfair. This decision upheld California's right to tax multistate businesses based on a formula considering property, payroll and sales within the state.

In the dissenting opinion for Container Corporation of America v. Franchise Tax Board, Justice Powell argued that California's use of a worldwide combined reporting method to calculate state income tax was unconstitutional. He contended that this approach violated both the Due Process and Commerce Clauses by unfairly burdening interstate commerce and failing to provide sufficient connection between the state and the foreign earnings it sought to tax. Furthermore, he expressed concern about potential international discord resulting from states taxing income earned abroad without clear jurisdictional authority or apportionment standards. The majority’s decision, according to him, could lead other states to adopt similar measures leading potentially towards double taxation on corporations' overseas profits which would be detrimental for American businesses operating globally.