The U.S. Supreme Court case Standard Oil Company v. Graves (1918) revolved around the issue of whether a state could impose an inspection fee on petroleum products imported from other states, without violating the Commerce Clause of the Constitution which prohibits states from interfering with interstate commerce. The State of Washington had imposed such a fee on Standard Oil Company, arguing it was necessary to ensure public safety and welfare by inspecting for quality and purity standards. The oil company contended that this constituted an unlawful burden on interstate commerce. In its decision, the Supreme Court upheld Washington's right to levy such fees as long as they were reasonable and applied equally to all similar goods regardless of their origin within or outside the state boundaries. It ruled that while states cannot regulate interstate commerce directly, they can exercise their police powers in ways that might incidentally affect it if done so in pursuit of legitimate local public interests like health or safety concerns.

In the dissenting opinion for Standard Oil Company v. Graves, Justice Louis Brandeis argued that the majority's decision was inconsistent with previous rulings regarding interstate commerce and taxation. He contended that Washington state's tax on oil imported from another state violated the Commerce Clause of the U.S. Constitution because it discriminated against out-of-state businesses by imposing a heavier burden on them than on in-state companies. According to Brandeis, this type of discriminatory taxation had been consistently struck down by prior Supreme Court decisions as an unconstitutional interference with interstate commerce. Furthermore, he disagreed with the majority's view that such taxes were permissible if they were used to fund regulatory activities related to public health or safety; instead, he believed these purposes could be achieved without resorting to discriminatory taxation.