In the case of Industrial Accident Commission of the State of California et al. v. Davis, as Agent, &c. (Los Angeles & Salt Lake Railway Company), 1921, the U.S Supreme Court was tasked with determining whether a state could impose its workers' compensation laws on interstate commerce companies operating within its borders. The Los Angeles and Salt Lake Railway Company argued that it should not be subject to California's workers' compensation laws because it was an interstate business and therefore only subject to federal regulation under the Commerce Clause of the Constitution. However, in a unanimous decision led by Justice Louis Brandeis, the court ruled against this argument stating that while states cannot directly regulate interstate commerce they can indirectly do so through police powers if there is no conflicting federal legislation or interference with commerce itself.

In the dissenting opinion for Industrial Accident Commission of California v. Davis, it was argued that the majority's decision to uphold a state law requiring out-of-state corporations to consent to jurisdiction in workers' compensation cases violated constitutional principles of due process and equal protection. The dissent contended that this requirement unfairly discriminated against foreign corporations by forcing them into an agreement they may not have otherwise chosen, thereby infringing upon their rights as protected under the Fourteenth Amendment. Furthermore, it was suggested that such legislation could potentially lead to a chaotic legal environment where states impose conflicting obligations on interstate businesses. This would undermine national unity and disrupt commerce between states - contrary to what is intended by federalism and our Constitution’s Commerce Clause.