In the case of Nelson et al., Successor Trustees, et al. v. City of New York in 1956, the Supreme Court ruled on a dispute involving property tax assessments. The plaintiffs were trustees who owned land in New York City that was leased to various tenants for commercial use and they argued that their properties had been overvalued by city assessors, resulting in unfairly high taxes. They claimed this violated the Equal Protection Clause of the Fourteenth Amendment as other similar properties were assessed at lower values leading to lower taxes for those owners. The court held that while there may have been inconsistencies or errors made by city assessors when valuing certain properties, these did not amount to "intentional systematic undervaluation" which would be necessary for an equal protection violation claim under federal law. Therefore, it upheld previous rulings denying relief to the plaintiffs.

In the dissenting opinion for Nelson et al., Successor Trustees, et al. v. City of New York, Justice Frankfurter argued that the majority's decision was a departure from established principles of constitutional law and an intrusion into state affairs. He contended that it is not within the jurisdiction of federal courts to interfere with states' decisions regarding their own fiscal operations unless there is clear violation or abuse of power which he did not see in this case. The justice believed that New York City’s action to revise its tax assessments on properties owned by out-of-state corporations was a legitimate exercise of its taxing powers under state law and should be respected by federal courts as such. He also pointed out potential negative consequences if federal courts were allowed to intervene in local taxation matters based on vague standards, including uncertainty for taxpayers and disruption in local government finance.