The Gorham Manufacturing Company v. Wendell case in 1922 revolved around the issue of taxation on out-of-state corporations operating within New York State. The plaintiff, Gorham Manufacturing Company, a Rhode Island corporation with business operations in New York, challenged the constitutionality of a tax imposed by the state on its capital stock used and employed within New York. The company argued that this was an infringement upon interstate commerce and violated their rights under both the Commerce Clause and Fourteenth Amendment's Equal Protection Clause. However, the U.S Supreme Court upheld the legality of such taxes stating they were not discriminatory or burdensome to interstate commerce as long as they were applied equally to all businesses operating within state boundaries regardless of where they are incorporated. Furthermore, it ruled that there was no violation against equal protection since different states have differing methods for taxing foreign corporations which does not necessarily constitute discrimination.

The dissenting opinion in the case of Gorham Manufacturing Company v. Wendell, argued that the majority's decision to uphold a New York law taxing foreign corporations for their capital within and outside the state was incorrect. The dissenters believed this ruling violated both due process and equal protection clauses of the Fourteenth Amendment. They contended that it was unjust to tax a corporation based on its total capital when only a portion of that capital is used or has presence in New York State. This taxation method, they argued, unfairly burdened out-of-state companies compared to local ones who were taxed solely on their assets within state borders - thus violating principles of equality under law as well as interstate commerce protections.