The U.S. Supreme Court case South Central Bell Telephone Company, et al. v. Alabama et al., 1998 revolved around the constitutionality of a tax imposed by the state of Alabama on out-of-state telephone companies for their in-state business operations. The plaintiffs, including South Central Bell Telephone Company and other interstate phone service providers, argued that this tax violated the Commerce Clause of the U.S Constitution as it discriminated against interstate commerce by taxing only those businesses operating across state lines while exempting similar in-state businesses from such taxation. The court ruled unanimously in favor of South Central Bell Telephone Co., holding that Alabama's franchise tax was indeed discriminatory and thus unconstitutional under the Commerce Clause because it treated local and non-local corporations differently without any substantial justification related to legitimate public interests or policy objectives.

In the dissenting opinion for South Central Bell Telephone Company v. Alabama, Justice Ginsburg disagreed with the majority's interpretation of the Commerce Clause and its application to this case. She argued that Alabama’s tax scheme did not discriminate against interstate commerce as it treated in-state and out-of-state businesses equally. The fact that some companies might end up paying more taxes due to their structure or operations was seen by her as a natural consequence of any taxation system, rather than an unconstitutional burden on interstate commerce. Furthermore, she pointed out that under the Court's ruling, states would be severely limited in their ability to design their own tax systems - something which goes against principles of federalism.