In the case of Coyle v. Smith, Secretary of State of Oklahoma in 1910, the U.S. Supreme Court ruled that Congress could not dictate to a state where its capital should be located as it was a violation of the principles underpinning federalism and states' rights. The controversy began when Oklahoma moved its state capital from Guthrie to Oklahoma City shortly after being admitted into the Union in 1907. This move violated an enabling act passed by Congress which stipulated that Guthrie would remain as the capital until at least 1913. However, Justice Joseph McKenna delivered for a unanimous court stating that once a territory becomes a state and is admitted into the Union on equal footing with existing states, it gains all powers associated with sovereignty including determining location of its own seat of government.

In the dissenting opinion for Coyle v. Smith, Justice Edward Douglass White argued that Congress had the authority to impose conditions on a state's admission into the Union and that such conditions did not violate principles of equal footing or state sovereignty. He contended that Oklahoma’s agreement to keep its capital in Guthrie was part of its enabling act and therefore binding. According to him, this condition was not an infringement upon state rights as it didn't interfere with any fundamental attributes of statehood but merely regulated a matter which could be subject to congressional control even after admission. The majority decision, he believed, undermined Congress's power over territories and their transition into stateship by invalidating these types of agreements made during the process.