In the 1922 case of Phipps and Phipps v. Cleveland Refining Company, the Supreme Court dealt with a dispute over taxation between the State of Ohio and a local refining company. The state had levied taxes on gasoline stored in tanks owned by Cleveland Refining Company, which was then sold to customers outside of Ohio. The company argued that this tax violated their rights under both the Due Process Clause and Commerce Clause of the U.S Constitution as it imposed an undue burden on interstate commerce. The Supreme Court ruled in favor of Cleveland Refining Company, stating that while states have broad powers to levy taxes for revenue purposes, they cannot do so in a way that interferes with or burdens interstate commerce. This decision reinforced principles established by previous rulings regarding limitations on state taxation power when it comes into conflict with federal authority over interstate commerce.

The dissenting opinion in the case of Phipps and Phipps v. Cleveland Refining Company argued that the majority's decision was inconsistent with previous rulings on similar matters, particularly those involving taxation. The dissenters believed that the tax imposed by Ohio on gasoline produced within its borders but sold outside of it was not an unconstitutional burden on interstate commerce as determined by the majority. They contended that this tax did not discriminate against out-of-state businesses nor did it provide a commercial advantage to local ones; rather, it merely sought to collect revenue from a product manufactured within state lines before being transported elsewhere for sale. Furthermore, they pointed out inconsistencies between this ruling and past decisions where taxes were upheld despite having more direct impacts on interstate commerce than in this case.