In the 1939 case Ford Motor Co. v. Beauchamp, Secretary of State of Texas et al., the Supreme Court ruled in favor of Ford Motor Company against a tax imposed by the state of Texas on interstate commerce activities. The court held that this tax was unconstitutional as it violated the Commerce Clause which gives Congress exclusive power over interstate commerce regulation. The state had argued that since Ford's vehicles were assembled within its borders, they could impose a franchise tax based on their value before shipment to dealers outside Texas. However, Justice Owen Roberts writing for majority stated that such taxation interfered with interstate commerce and thus was not permissible under federal law.

In the dissenting opinion for Ford Motor Co. v. Beauchamp, it was argued that the majority's decision to uphold Texas' franchise tax on Ford violated both the Due Process and Commerce Clauses of the Constitution. The dissent contended that Texas had no right to impose a tax on activities conducted entirely outside its borders, as this constituted an undue burden on interstate commerce. Furthermore, they asserted that by taxing Ford based solely on its total capital without considering where or how it was employed, Texas failed to provide due process under law. They maintained that such taxation methods were arbitrary and unreasonable because they did not accurately reflect a company’s operations within state boundaries.