In the 1935 case of Premier-Pabst Sales Co. v. Grosscup et al., the U.S Supreme Court dealt with a dispute over beer distribution rights in Michigan during Prohibition's repeal period. The plaintiff, Premier-Pabst Sales Company, was an out-of-state brewer who had entered into contracts with various local distributors to sell its products within Michigan state lines. However, these agreements were challenged by defendants under a new state law that prohibited brewers from directly controlling or influencing retail sales of their product. The main issue before the court was whether this law violated the Commerce Clause of the Constitution by unduly burdening interstate commerce and favoring local businesses at expense of out-of-state companies like Pabst. Ultimately, it was ruled that while states have broad power to regulate alcohol due to its unique nature as a potentially harmful substance (as recognized in Section 2 of Twenty-first Amendment), they cannot use this authority in ways that discriminate against or unfairly burden interstate commerce without sufficient justification. Therefore, since Michigan’s law seemed primarily aimed at protecting local businesses rather than promoting public health or safety concerns related to alcohol consumption (which would be valid reasons for such regulation), it was struck down as unconstitutional interference with interstate commerce.

In the dissenting opinion for Premier-Pabst Sales Co. v. Grosscup et al., Justice Stone argued that the majority's decision was inconsistent with previous rulings of the Court and violated principles of federalism by allowing a state to regulate interstate commerce in ways that could potentially harm it. He contended that while states have power to protect public health, safety, and welfare within their borders, they should not be allowed to use this power as a pretext for economic protectionism or discrimination against out-of-state businesses. In his view, Michigan's law requiring beer distributors to maintain an inventory within the state was such a pretext because it placed an undue burden on out-of-state brewers who had no physical presence in Michigan but wanted to sell their products there through independent wholesalers. This requirement effectively forced these brewers either to establish costly storage facilities in Michigan or stop selling their beers there altogether - both options being detrimental not only for them but also for consumers who would face higher prices or less variety as a result.