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Page Number: 19.0

Cite as:  598 U. S. ____ (2023) 

13 

Opinion of the Court 

commerce outside their borders.  Gibbons, 9 Wheat., at 203; 
see also Cooley, 12 How., at 317–321.  Petitioners’ “almost 
per se” rule against laws that have the “practical effect” of 
“controlling”  extraterritorial  commerce  would  cast  a 
shadow over laws long understood to represent valid exer-
cises  of  the  States’  constitutionally  reserved  powers.  It 
would provide neither courts nor litigants with meaningful
guidance in how to resolve disputes over them.  Instead, it 
would  invite  endless  litigation  and  inconsistent  results. 
Can  anyone  really  suppose  Baldwin,  Brown-Forman,  and 
Healy meant to do so much? 

In rejecting petitioners’ “almost per se” theory we do not
mean to trivialize the role territory and sovereign bounda-
ries play in our federal system.  Certainly, the Constitution 
takes  great  care  to  provide  rules  for  fixing  and  changing 
state borders.  Art. IV, §3, cl. 1.  Doubtless, too, courts must 
sometimes referee disputes about where one State’s author-
ity ends and another’s begins—both inside and outside the 
commercial context.  In carrying out that task, this Court
has recognized the usual “legislative power of a State to act
upon persons and property within the limits of its own ter-
ritory,” Hoyt v. Sprague, 103 U. S. 613, 630 (1881), a feature 
of our constitutional order that allows “different communi-
ties” to live “with different local standards,” Sable Commu-
nications  of  Cal.,  Inc.  v.  FCC,  492  U. S.  115,  126  (1989).
But, by way of example, no one should think that one State
may adopt a law exempting securities held by the residents 
of a second State from taxation in that second State.  Bona-
parte v. Tax Court, 104 U. S. 592, 592–594 (1882).  Nor, we 
have  held,  should  anyone  think  one  State  may  prosecute
the citizen of another State for acts committed “outside [the
first State’s] jurisdiction” that are not “intended to produce 
[or  that  do  not]  produc[e]  detrimental  effects  within  it.” 
Strassheim v. Daily, 221 U. S. 280, 285 (1911). 

To resolve disputes about the reach of one State’s power,