In the United States v. California case of 1979, the Supreme Court ruled in favor of federal jurisdiction over offshore resources. The dispute arose when California claimed ownership and control over three nautical miles off its coast, arguing that it had historically exercised such authority and that this was recognized by Mexico before cession to the U.S. However, the Federal Government argued for exclusive rights based on international law principles and national security interests. The court held that while states could exert some influence within their borders extending into sea territory (such as regulating fishing), they did not have sovereignty or proprietary interest beyond low-water mark except for narrowly defined exceptions granted by Congress. This decision affirmed federal supremacy in managing offshore oil drilling activities under Submerged Lands Act (1953) and Outer Continental Shelf Lands Act (1953). It also clarified boundaries between state-federal jurisdictions regarding marine resources exploitation.

In the dissenting opinion for United States v. California, Justice William Rehnquist argued that the majority's decision to uphold federal authority over offshore resources was a misinterpretation of both constitutional law and historical precedent. He contended that states should retain control over their adjacent waters and seabed resources up to three miles from shore, as had been traditionally recognized in international law. Furthermore, he believed that Congress did not have unlimited power under the Commerce Clause to regulate all activities on or beneath these coastal waters; such an interpretation would effectively eliminate any meaningful limit on federal jurisdiction. Instead, he suggested that state sovereignty should be respected unless there is a clear conflict with national interests or policies - which he did not believe existed in this case.