In the case of United States v. Klein, Escheator of Pennsylvania (1937), the Supreme Court ruled in favor of the United States government. The dispute arose over a federal estate tax that was levied on an inheritance left by a resident of Pennsylvania to his niece who lived in Switzerland. After paying both state and federal taxes, the executor sued for refund claiming double taxation under Fifth Amendment due process clause. However, this claim was rejected by lower courts and eventually reached Supreme Court. The court held that there is no constitutional prohibition against double taxation provided it's not done by same sovereignty i.e., two different states or state and federal government can levy their respective taxes on same property or income without violating any constitutional rights as long as they don't infringe upon each other's jurisdictional authority. Justice Benjamin Cardozo delivered majority opinion stating that while multiple taxing authorities may impose burdensome obligations on taxpayers, such situations do not constitute unconstitutional deprivation of property without due process law unless there is clear infringement upon another sovereign’s right to tax.

The dissenting opinion in the United States v. Klein case, delivered by Justice McReynolds, argued that the majority's decision to uphold a federal estate tax on property transferred at death was unconstitutional. He contended that such a tax is essentially an unapportioned direct tax and thus violates Article I of the Constitution which requires all direct taxes to be apportioned among states based on population. According to him, this requirement cannot be circumvented simply by labeling it as an "excise" or "duty". Furthermore, he pointed out that if Congress could impose such a levy without regard for constitutional restrictions then there would effectively be no limit upon its power of taxation - something clearly not intended by the framers of the Constitution. He also criticized his colleagues' reliance on precedent from previous cases upholding similar taxes because those decisions were equally flawed and should not serve as justification for further error.