In the case of Pullman's Palace Car Company v. Metropolitan Street Railway Company, 1894, the U.S Supreme Court was tasked with determining whether a contract between two corporations could be enforced if it violated state law. The Pullman's Palace Car Co., an Illinois corporation, had leased its cars to the Metropolitan Street Railway Co., a New York company for use in Kansas City. However, Missouri laws prohibited foreign corporations from doing business within their borders without having filed certain papers and paid certain fees which neither company had done at that time. The court ruled in favor of Pullman’s Palace Car Co., stating that while states have the power to regulate businesses operating within their boundaries, they cannot interfere with interstate commerce or contracts made therein as this falls under federal jurisdiction according to Article I Section 8 Clause 3 (the Commerce Clause) of the Constitution. Therefore, despite violating Missouri state law by not filing necessary paperwork and paying required fees before conducting business there; both companies were still able to enforce their contract because it pertained to interstate commerce.

The dissenting opinion in the case of Pullman's Palace Car Company v. Metropolitan Street Railway Company argued that the majority erred in their interpretation of the law and its application to this particular case. The dissent believed that there was no legal basis for denying a corporation, such as Pullman's Palace Car Company, from operating within a state simply because it had not been incorporated within that state. They contended that corporations should be treated similarly to individuals under the law, with equal rights and protections regardless of where they were incorporated or operated. Furthermore, they disagreed with the majority’s view on interstate commerce regulation by states; arguing instead for federal jurisdiction over these matters due to constitutional provisions regarding interstate commerce. Thus, they felt states should not have power to regulate companies like Pullman's which operate across multiple states.