In the 1939 case of Illinois Central Railroad Co. v. Minnesota, the U.S Supreme Court ruled in favor of the Illinois Central Railroad Company, overturning a decision by the Minnesota Tax Commission to tax railroad properties at higher rates than other commercial and industrial properties within its jurisdiction. The court held that this was discriminatory and violated both due process and equal protection clauses under the Fourteenth Amendment of the Constitution. The state argued that railroads were more valuable because they were part of an integrated system but failed to convince justices who maintained that all property should be assessed for taxation purposes based on its fair market value without considering factors such as strategic location or being part of a larger network.

The dissenting opinion in the case of Illinois Central Railroad Co. v. Minnesota argued that the majority's decision was a departure from established principles regarding interstate commerce and taxation by states. The dissent contended that the tax imposed by Minnesota on gross earnings derived from both intrastate and interstate operations did not discriminate against interstate commerce, as it applied equally to all railroads operating within its borders, regardless of whether their activities were purely local or involved other states as well. Furthermore, they disagreed with the majority's view that this tax constituted an undue burden on interstate commerce because it was based on total mileage rather than just mileage within Minnesota; according to them, such apportionment methods had been upheld in previous cases where taxes were levied upon businesses engaged in both intra- and inter-state activities.