In the 1962 case Halliburton Oil Well Cementing Co. v. Reily, Collector of Revenue of Louisiana, the Supreme Court ruled in favor of Halliburton Oil Well Cementing Company (Halliburton). The case revolved around a dispute over whether or not certain items used by Halliburton in its oil well cementing operations could be classified as "sales for use" and therefore subject to sales tax under Louisiana law. The state argued that these items were sold for use while Halliburton contended they were part of a service it provided and thus should not be taxed as retail sales. The court sided with Halliburnton, holding that the primary purpose was to perform services rather than sell tangible personal property; hence no taxable event occurred under Louisiana's Sales Tax Act when these materials were transferred from Halilburon to its customers during performance of those services.

In the dissenting opinion for Halliburton Oil Well Cementing Co. v. Reily, it was argued that Louisiana's tax on the use of property in state waters did not violate the Due Process Clause or Commerce Clause of the U.S. Constitution as claimed by Halliburton. The dissenters believed that since Halliburton had a significant presence and conducted substantial business activities within Louisiana, including using its equipment to perform services for oil well operators in state waters, it was reasonable and constitutional for Louisiana to impose a use tax on such equipment used within its jurisdictional boundaries. They contended that this case differed from previous cases where taxes were struck down because they interfered with interstate commerce; here, there was no evidence presented showing any negative impact on interstate commerce due to this tax imposition by Louisiana.