In the case of Hartford Accident & Indemnity Co. v. Illinois ex rel. McLaughlin, Director of Agriculture, the U.S Supreme Court ruled in favor of Hartford Accident & Indemnity Company (Hartford). The state of Illinois had levied a tax on insurance companies operating within its borders based on their total assets worldwide rather than just those held within the state itself. Hartford challenged this taxation method as unconstitutional under both due process and equal protection clauses because it was being taxed for property not located or used in Illinois, which they argued amounted to extraterritorial taxation. The court agreed with Hartford's argument that such a tax violated principles of interstate commerce by taxing activities outside its jurisdictional boundaries and thus exceeded constitutional limits placed upon states' power to levy taxes. Therefore, it struck down the law imposing these taxes as unconstitutional.

In the dissenting opinion for Hartford Accident & Indemnity Co. v. Illinois ex rel. McLaughlin, Justice Stone argued that the majority's decision to uphold an Illinois statute regulating insurance companies was a violation of due process rights under the Fourteenth Amendment. He contended that there was no rational basis for treating out-of-state insurers differently from in-state ones and thus, it violated equal protection principles as well. Furthermore, he disagreed with the majority's view on interstate commerce regulation; he believed this law interfered with such commerce by imposing burdensome conditions upon out-of-state insurers seeking to do business within Illinois borders which could potentially discourage them from operating in the state altogether - a power reserved exclusively for Congress according to him.