The U.S. Supreme Court case New Energy Company of Indiana v. Limbach, Tax Commissioner of Ohio et al., 1987, revolved around an Ohio tax credit that favored in-state ethanol producers over out-of-state ones. The New Energy Company of Indiana challenged this law as a violation of the Commerce Clause which prohibits states from passing legislation that discriminally affects interstate commerce. The court ruled unanimously in favor of the New Energy Company, stating that the tax credit was unconstitutional because it attempted to encourage local industry by burdening out-of-state competitors and thus violated the Commerce Clause's principle against state protectionism.

In the dissenting opinion for New Energy Company of Indiana v. Limbach, Tax Commissioner of Ohio et al., Justice Scalia argued that the majority's decision was inconsistent with previous rulings on interstate commerce and taxation. He contended that Ohio's tax credit did not discriminate against out-of-state ethanol producers because it applied equally to all ethanol sold in Ohio, regardless of its origin. The fact that no out-of-state producer could currently take advantage of this credit was irrelevant; what mattered was whether they had the opportunity to do so under equal terms as in-state producers. Furthermore, he disagreed with the majority's view that a state cannot encourage local industry at the expense of out-of-state competitors unless it is protecting a unique local resource or responding to health and safety concerns. In his view, states should have more latitude to promote their own economic interests.