The case of Shallenberger, Governor of the State of Nebraska, v. First State Bank of Holstein, Nebraska in 1910 revolved around a dispute over state taxation powers. The governor sought to impose a tax on the bank's shares under an amendment to the state constitution that allowed for such taxes. However, this was challenged by the bank which argued that it violated their rights as per federal law and Constitution since they were already paying taxes at a national level. The U.S Supreme Court ruled in favor of Shallenberger stating that states have authority to levy taxes on property within its jurisdiction including shares owned by banks even if these are also taxed federally. This decision upheld dual sovereignty where both federal and state governments can exercise power independently without infringing upon each other’s jurisdictions.

In the dissenting opinion for Shallenberger v. First State Bank of Holstein, Nebraska, 1910, it was argued that the majority's decision to strike down a Nebraska law regulating banking practices violated principles of federalism and states' rights. The dissenting justices believed that the state had a legitimate interest in protecting its citizens from potentially harmful business practices and should be allowed to regulate banks within its borders as it saw fit. They also disagreed with the majority's interpretation of the Contract Clause, arguing that this provision did not prevent states from passing laws aimed at promoting public welfare or economic stability. Furthermore, they contended that by invalidating Nebraska’s law on constitutional grounds without sufficient justification, the Court overstepped its judicial authority and encroached upon legislative powers reserved for individual states under our system of government.