In the 1906 case of Metropolitan Life Insurance Company of New York v. City of New Orleans, the U.S. Supreme Court dealt with a dispute over taxation between an insurance company and a city government. The Metropolitan Life Insurance Company had been taxed by the City of New Orleans based on its gross premiums, which included both in-state and out-of-state business activities. The insurance company argued that this tax was unconstitutional as it violated their rights under the Fourteenth Amendment's Due Process Clause because they were being taxed for activities outside Louisiana's jurisdiction. The court ruled in favor of the City of New Orleans, stating that while states cannot tax property or operations beyond their borders, they can impose taxes on businesses operating within their boundaries even if those businesses also operate elsewhere. Therefore, taxing an insurance company based on its total gross premiums did not violate constitutional principles since it was partaken as part payment for protection given to local business.

In the dissenting opinion for Metropolitan Life Insurance Company of New York v. City of New Orleans, Justice Harlan disagreed with the majority's ruling that a city could tax an insurance company based on its nationwide business activities rather than just those within the city limits. He argued that this was not only unfair but also unconstitutional as it violated due process rights under the Fourteenth Amendment. According to him, a state or municipality should only have jurisdiction over businesses and transactions occurring within their geographical boundaries and cannot impose taxes on out-of-state operations or assets. He further contended that allowing such taxation would lead to double taxation since other states where these companies operate might also levy similar taxes leading to undue burden on interstate commerce which is against federal law principles.