In the 1902 case of Western Union Telegraph Company v. Missouri Ex Rel. Gottlieb, the U.S Supreme Court ruled in favor of Western Union Telegraph Company, overturning a decision by the Supreme Court of Missouri. The dispute arose when Gottlieb, as relator for Missouri, sought to compel Western Union to pay taxes on all its property located within state borders including telegraph lines running through several states and their respective messages transmitted over these lines. The court held that interstate commerce cannot be taxed at all even if it starts or ends in one state or may continue beyond an international boundary line into another country; hence only those properties physically present within a state can be subjected to taxation by that particular state. Therefore, since most of Western Union's business was conducted across multiple states (interstate), it could not be taxed solely by Missouri.

In the dissenting opinion for Western Union Telegraph Company v. Missouri ex rel. Gottlieb, Justice Harlan argued that the majority's decision was a misinterpretation of the Constitution and an overreach of federal power at the expense of state rights. He contended that states should retain their authority to regulate businesses within their borders, particularly when it comes to protecting citizens from unfair practices or harm. In this case, he believed Missouri had every right to impose regulations on telegraph companies operating within its boundaries without interference from federal law or courts. He further asserted that interstate commerce laws did not exempt such companies from adhering to local rules and regulations designed for public welfare and protection against potential abuses by powerful corporations like Western Union.