In the 1893 case of Postal Telegraph Cable Company v. Charleston, the U.S Supreme Court ruled in favor of Postal Telegraph Cable Company, overturning a decision by South Carolina's highest court. The city of Charleston had imposed an annual license fee on all telegraph companies operating within its limits. However, the Postal Telegraph Cable Company argued that this was unconstitutional as it violated their rights under federal law which granted them permission to operate without such fees being levied by state or local governments. The Supreme Court agreed with this argument and held that while states could regulate businesses for public welfare purposes, they couldn't impose taxes or fees on federally authorized activities unless explicitly allowed by Congress.

In the dissenting opinion for the case of Postal Telegraph Cable Company v. Charleston, it was argued that a municipality should not have the power to charge telegraph companies for using public roads to lay their cables. The dissenting justices believed this constituted an unfair tax on interstate commerce and violated federal law which allowed such companies to operate freely across state lines. They contended that if every city or town could impose its own fees or restrictions, it would create an untenable situation where telegraph companies might be forced out of business due to excessive costs and regulations. This, they said, would undermine national communication infrastructure and impede economic growth.