In the case of Alaska Pacific Fisheries v. Territory of Alaska (1918), the U.S. Supreme Court ruled in favor of the Territory of Alaska, upholding its right to regulate fishing within three miles from its coastlines, including those surrounding islands and bays. The dispute arose when a floating fish trap owned by Alaska Pacific Fisheries was seized by Alaskan authorities for violating local laws that prohibited non-residents from operating such traps within these waters. The company argued that this law infringed upon their rights under an 1867 treaty between Russia and the United States which guaranteed free access to all coastal waters for commercial purposes without restrictions based on residency status or nationality. However, the court held that since Congress had not explicitly extended these treaty provisions to include territories like Alaska at time it became part of US territory in 1898, they did not apply here.

In the dissenting opinion for Alaska Pacific Fisheries v. Territory of Alaska, Justice Holmes disagreed with the majority's interpretation of Metlakatla Indians' rights to fishing grounds. He argued that when Congress granted them a reservation in 1891, it intended to provide not just land but also resources necessary for their survival and traditional way of life, which included fishing. The language used by Congress was broad enough to include both upland and tideland areas within the reservation boundaries. Therefore, he believed that the salmon cannery operated by Alaska Pacific Fisheries on an island within those boundaries infringed upon these rights. Furthermore, he contended that even if there were ambiguities about whether tidelands were included in the grant or whether commercial enterprises like canneries could be considered as infringing upon Indian fisheries - such doubts should be resolved in favor of indigenous people due to principles of equity and historical injustices they have suffered.