In the case of Richfield Oil Corp. v. State Board of Equalization, the U.S Supreme Court ruled in favor of California's State Board of Equalization. The dispute arose when Richfield Oil Corporation challenged a state tax on its oil storage facilities located offshore but within California's boundaries, arguing that it was an unconstitutional burden on interstate commerce and violated due process rights under the Fourteenth Amendment. However, the court held that as long as a state tax is fairly apportioned and does not discriminate against interstate commerce or create undue burdens upon it, such taxes are constitutional even if they affect interstate commerce indirectly. Furthermore, regarding due process concerns raised by Richfield Oil Corp., the court found no violation since there was sufficient connection between California and these properties to justify taxation.

In the dissenting opinion for Richfield Oil Corp. v. State Board of Equalization, Justice Frankfurter argued that the Court had overstepped its bounds by intervening in a state tax matter and interpreting California law instead of deferring to the interpretation given by California's highest court. He contended that it was not within their jurisdiction or expertise to interpret state laws when there is no federal question involved, as this case primarily concerned a dispute about how much tax should be levied on certain oil properties under California law. Furthermore, he believed that even if they were to intervene in such cases, they should give considerable weight to interpretations made by local courts who are more familiar with their own laws and precedents than an outside entity like the Supreme Court would be.