In the 1915 case of American Well Works Company v. Layne and Bowler Company, the U.S. Supreme Court ruled on a matter concerning jurisdiction in cases involving tortious interference with business relationships. The plaintiff, American Well Works Co., had sued Layne & Bowler Co., alleging that they maliciously interfered with its contracts and business relations by spreading false rumors about their products' quality and reliability. The central issue was whether such a claim arose under federal law (thus giving federal courts jurisdiction) or state law. The court held that this type of dispute did not arise under federal law simply because it involved parties from different states; rather, it fell within the purview of state laws governing unfair competition and defamation. Therefore, unless there is some other basis for federal jurisdiction (such as diversity of citizenship), these types of claims should be adjudicated in state courts. This decision helped to clarify the distinction between issues arising under federal versus state laws - an important aspect in determining which court has jurisdiction over a particular case.

In the dissenting opinion for American Well Works Company v. Layne and Bowler Company, Justice Holmes disagreed with the majority's decision to dismiss the case on jurisdictional grounds. He argued that a federal question was indeed present in this case because it involved an alleged violation of federal antitrust laws. According to him, even though state law governed some aspects of the dispute, such as defamation claims, these were secondary issues compared to the primary claim of unfair competition under federal law. Therefore, he believed that there was sufficient basis for federal jurisdiction over this matter and thus dissented from his colleagues' decision to remand it back to state court.