The U.S. Supreme Court case Davis, as Agent, etc. v. Portland Seed Company in 1923 revolved around the issue of whether a state could impose taxes on an out-of-state corporation that had not conducted any business within its borders but had only shipped goods into the state upon order from customers there. The Portland Seed Company was based in Oregon and sold seeds to farmers across various states including California where it did not have any physical presence or employees working for them directly except through mail orders received by post or express companies operating independently of the seed company itself. In this context, California sought to levy a tax on the company's gross receipts derived from sales made within its territory which led to litigation reaching up to the Supreme Court level after lower courts upheld such taxation measures imposed by California authorities against interstate commerce principles. However, Justice Oliver Wendell Holmes Jr., writing for a unanimous court held that since all activities related with selling and delivering goods were carried out outside of California (in Oregon), no taxable event occurred inside Californian jurisdiction warranting imposition of such taxes under existing laws at that time thereby ruling in favor of Portland Seed Company.

In the dissenting opinion for Davis v. Portland Seed Company, Justice McReynolds disagreed with the majority's decision to uphold a lower court ruling that allowed an agent of the U.S. Department of Agriculture to seize and destroy a shipment of clover seed under authority granted by the Federal Seed Act. He argued that this act was unconstitutional as it violated due process rights guaranteed by the Fifth Amendment because it did not provide any opportunity for judicial review before seizure or destruction occurred. Furthermore, he contended that Congress had overstepped its bounds in passing such legislation since regulating commerce within states is typically left up to individual state governments rather than federal authorities. In his view, allowing federal agents unchecked power to seize and destroy property without prior judicial approval set a dangerous precedent.