In the case of Allied Structural Steel Co. v. Spannaus, Attorney General of Minnesota et al., 1977, the U.S. Supreme Court ruled in favor of Allied Structural Steel Company by a vote of 5-4. The court held that a Minnesota law violated the Contract Clause as it retroactively imposed severe penalties on companies for reducing pension benefits or terminating their pension plans without providing full vesting to employees who had worked there for ten years or more. The company argued that this law significantly altered its contractual obligations and increased its financial burden substantially beyond what was originally agreed upon when they established their private pension plan agreement with employees before enactment of this state statute. This decision underscored the principle that states cannot pass laws which impair contract rights and obligations unless such legislation is necessary to serve an important public purpose.

In the dissenting opinion for Allied Structural Steel Co. v. Spannaus, Justice Brennan argued that Minnesota's law did not violate the Contract Clause of the Constitution because it was a reasonable response to a broad societal problem - protecting employees' pension benefits in an era of corporate mobility and instability. He believed that this type of regulation should be allowed as long as it is reasonably related to important public issues, which he felt was true in this case. Furthermore, he disagreed with the majority’s view that only emergency situations justify such laws; instead, he contended regular economic regulations could also meet constitutional standards if they were fair and rational responses to significant social problems. Lastly, Justice Brennan criticized the majority for overstepping its role by substituting its judgment on policy matters for those elected state officials who are more qualified and accountable to make these decisions.