In the United States v. California case of 1964, the U.S. Supreme Court ruled in favor of the federal government over a dispute about offshore oil reserves. The state of California claimed ownership and control over three miles off its coast, including valuable oil resources found there. However, the federal government argued that it had exclusive rights to these areas under international law principles and previous court decisions regarding coastal waters jurisdiction. The Supreme Court agreed with this argument by reaffirming prior rulings that granted authority to the federal government for all submerged lands seaward from low-water mark on coastline out to three nautical miles (the marginal sea). This decision effectively gave control over vast amounts of natural resources located beneath ocean's surface to Washington D.C., rather than individual states like California.

In the dissenting opinion for United States v. California, Justice Stewart disagreed with the majority's decision that federal law preempted a state tax on oil and gas leases in federally owned submerged lands off the coast of California. He argued that there was no explicit provision in federal legislation barring states from imposing such taxes, nor any clear evidence of Congressional intent to do so. Furthermore, he contended that since these lands were within three miles of California’s coastline and thus within its administrative jurisdiction under Submerged Lands Act (SLA), it should be allowed to impose this tax without interference from federal authorities. The justice also pointed out inconsistencies between this ruling and previous decisions regarding similar issues involving other states' rights over their adjacent offshore areas.