In the case of General Baking Co. v. Harr, Secretary of Banking of Pennsylvania et al., 1936, the U.S Supreme Court dealt with a dispute over taxation and interstate commerce. The General Baking Company was incorporated in New York but had property and conducted business in Pennsylvania as well. The state imposed a franchise tax on foreign corporations for the privilege of doing local business within its borders which General Baking Co challenged as unconstitutional under the Commerce Clause because it also engaged in interstate commerce. The court ruled against General Baking Co., upholding that states have power to impose such taxes on foreign corporations operating within their jurisdiction provided they do not interfere with or discriminate against interstate commerce. It held that there is no constitutional prohibition preventing a state from taxing an intrastate business merely because it's part of an integrated system extending beyond its boundaries into other states.

In the dissenting opinion for General Baking Co. v. Harr, Justice Cardozo disagreed with the majority's view that Pennsylvania's Blue Sky Law was unconstitutional as applied to a foreign corporation conducting interstate commerce within its borders. He argued that this law did not interfere with interstate commerce but instead sought to protect investors from fraud by requiring corporations selling securities in Pennsylvania to register and disclose pertinent information about their operations. The fact that these requirements might incidentally affect interstate commerce did not render them invalid under the Commerce Clause of the Constitution, according to Justice Cardozo. He believed states should be allowed some leeway in regulating economic activities within their boundaries even if they involve companies engaged in interstate business transactions.