In the 1930 case of Hans Rees' Sons, Inc. v. North Carolina ex rel. Maxwell, Commissioner of Revenue, the U.S Supreme Court ruled on a dispute regarding taxation and interstate commerce. The plaintiff was a New York corporation with tanneries in North Carolina that sold its products to customers across state lines and overseas. The company argued that it should not be subject to North Carolina's franchise tax because it conducted business outside of the state as well as within it; thus, they claimed this constituted an undue burden on interstate commerce which would violate the Commerce Clause of the Constitution. The court disagreed with their argument and upheld North Carolina's right to impose such taxes on corporations operating within its borders regardless if they also conduct business elsewhere or even primarily elsewhere. It held that since these companies benefit from protections provided by local law enforcement agencies and other services funded by taxpayers in those states where they operate physically (like fire protection), then these businesses are obligated to contribute towards those costs through taxation just like any other resident entity.

In the dissenting opinion for Hans Rees' Sons, Inc. v. North Carolina ex rel. Maxwell, Commissioner of Revenue, Justice Stone argued that the majority's decision to uphold a tax imposed by North Carolina on an out-of-state corporation was inconsistent with previous rulings and principles established by the Court regarding interstate commerce taxation. He contended that this ruling would allow states to impose discriminatory taxes on foreign corporations simply because they have property or do business within their borders - something he believed violated both due process and equal protection clauses of the Constitution. Furthermore, Justice Stone expressed concern about potential negative impacts on national unity and economic stability if each state were allowed to levy such taxes without federal oversight or regulation.