In the case of Smith v. Naphtaly, 1897, the United States Supreme Court ruled on a dispute involving taxation and property rights. The plaintiff, Smith, was an assessor for San Francisco who assessed taxes on certain shares of stock owned by defendant Naphtaly. However, these stocks were already taxed in New York where they were held as collateral security for loans made to California corporations. Naphtaly argued that this constituted double taxation and was therefore unconstitutional under both state and federal law. The court agreed with Naphtaly's argument that his property had been subjected to double taxation contrary to the Fourteenth Amendment which prohibits deprivation of property without due process of law. It concluded that since he did not have full control over those shares (as they were held as collateral), it wasn't fair or legal to tax him again in California when he'd already paid taxes on them in New York. This ruling set a precedent regarding interstate commerce and clarified how states could levy taxes on properties located outside their jurisdiction but owned by residents within their borders.

In the dissenting opinion for Smith v. Naphtaly, Justice Harlan argued that the majority's decision was a misinterpretation of the Constitution and an overreach of federal power. He contended that states should have autonomy in determining their own taxation policies without interference from federal courts unless there is clear violation of constitutional rights. Harlan believed this case did not present such a violation; rather it was simply a matter of state policy on tax assessment methods which he thought were fair and reasonable under Michigan law. He also expressed concern about potential negative implications this ruling could have on state sovereignty, fearing it might set precedent for future unwarranted intrusions into state affairs by federal judiciary.