The U.S. Supreme Court case Downes v. Bidwell in 1900 revolved around the issue of whether constitutional restrictions on taxation applied to newly acquired territories of the United States, specifically Puerto Rico. Samuel Downes, a New York merchant, challenged an import duty imposed by Congress on oranges he had brought from Puerto Rico after it became a U.S territory following the Spanish-American War. He argued that this violated Article I Section 8 of the Constitution which states that "all Duties, Imposts and Excises shall be uniform throughout the United States." The court ruled against Downes with a majority opinion stating that not all Constitutional protections automatically extended to territories not incorporated into states; these areas were subject to control by Congress under its territorial clause powers until they achieved statehood or equivalent status. This decision established what came to be known as “the doctrine of territorial incorporation,” allowing different rules for territories than for states.

In the dissenting opinion for Downes v. Bidwell, Justice John Marshall Harlan argued that the Constitution should apply in full to all territories under U.S. control, regardless of whether they were on a path towards statehood or not. He rejected the idea of "incorporated" and "unincorporated" territories, stating that such distinctions were not present in the Constitution itself and thus had no legal basis. He further contended that Congress did not have unlimited power over these territories; rather its powers were limited by constitutional rights and protections which could not be suspended or denied to people living within those areas simply because they weren't states yet. In essence, he believed it was unconstitutional for Congress to impose duties on goods coming from Puerto Rico into mainland United States as it violated uniformity clause requiring all duties, imposts and excises be uniform throughout United States.