This case was a dispute between the New Orleans, Mobile & Texas Railway Company and the State of Mississippi. The Railway Company had been operating in Mississippi since 1872, and had been paying taxes to the state since then. In 1883, the state passed a law that required the Railway Company to pay an additional tax on its property. The Railway Company argued that this law was unconstitutional, as it violated the Contract Clause of the United States Constitution. The Supreme Court agreed with the Railway Company, ruling that the law was unconstitutional. The Court held that the law violated the Contract Clause, as it impaired the Railway Company's contractual obligations to the state. The Court also held that the law was not a valid exercise of the state's police power, as it was not necessary to protect the public health, safety, or welfare. The Court concluded that the law was an unconstitutional infringement on the Railway Company's contractual rights.

In New Orleans, Mobile & Texas Railway Co. v. The State of Mississippi, Ex Rel. The District Attorney, the Supreme Court was asked to decide whether a state court had jurisdiction over an interstate railway company in a criminal case involving alleged violations of state law by the company's employees on its trains while they were operating within the boundaries of that state. Justice Field delivered the dissenting opinion and argued that states do not have authority to regulate or punish acts committed outside their borders even if those acts affect persons or property within their borders; therefore, he concluded that it was unconstitutional for Mississippi to exercise jurisdiction over this particular case since it involved activities occurring outside its territorial limits and thus beyond its power to control or punish under federal law. He further noted that allowing such action would be tantamount to granting each individual state unlimited powers which could lead to chaos as well as conflict between different jurisdictions with regard to similar cases arising from activities conducted across multiple states' boundaries simultaneously.