In the case of Baltimore and Ohio Railroad Company v. Hostetter, 1915, the U.S Supreme Court ruled in favor of the railroad company. The dispute arose when Mr. Hostetter was injured while working for the railroad company and sued for damages under a Pennsylvania law that held employers liable for injuries caused by their negligence or failure to provide safe work conditions. However, his employment contract stipulated that any disputes would be resolved according to Maryland law - which did not hold employers liable in such cases unless there was intentional misconduct involved. The court found that since both parties had agreed to abide by Maryland laws at the time of signing their contract, they were bound by those terms regardless of where an incident occurred or what other state laws might say about employer liability. This decision reinforced principles regarding freedom of contract and choice-of-law provisions within contracts.

In the dissenting opinion for Baltimore and Ohio Railroad Company v. Hostetter, it was argued that the majority's decision to uphold a state law requiring railroads to provide separate coaches for black passengers violated both the Fourteenth Amendment and Interstate Commerce laws. The dissenting justices contended that such segregation inherently implied inequality, thus violating equal protection rights under the Constitution. They also believed this ruling interfered with interstate commerce by imposing additional burdens on railroad companies operating across multiple states with differing racial segregation laws. Therefore, they felt that federal law should supersede state legislation in this matter due to its impact on interstate business operations.