In the case of Porter, Auditor v. Investors Syndicate in 1931, the U.S. Supreme Court ruled on a dispute over taxation between an investment company and the state of Minnesota. The court held that income derived from investments made by Investors Syndicate was not subject to tax under Minnesota law because it did not constitute "moneyed capital" as defined by statute. The decision hinged on whether or not these funds were used in competition with banks within the state; if they were, they would be considered moneyed capital and thus taxable. However, since this was found to be untrue - as their business model involved investing members' funds into various securities rather than lending them out like a bank - their earnings could not be taxed under existing laws.

In the dissenting opinion for Porter, Auditor v. Investors Syndicate, Justice Stone argued that the majority's decision to allow a foreign corporation to sue a state official in federal court was inconsistent with previous rulings and threatened states' rights. He contended that this case did not involve any constitutional issues or violations of federal law which would warrant intervention by a federal court. Instead, he believed it was purely an issue of state law concerning tax collection procedures and should be resolved at the state level. Furthermore, he expressed concern about potential abuse of power by corporations who could use such lawsuits as leverage against states in disputes over taxes or other matters.