In the case of Baltimore and Ohio Southwestern Railroad Company v. United States in 1910, the U.S Supreme Court ruled on a dispute involving railroad freight rates. The Interstate Commerce Commission (ICC) had ordered the Baltimore and Ohio Southwestern Railroad Company to increase its rates for hauling coal, arguing that their existing rates were discriminatory against certain shippers. The railroad company challenged this order, asserting that it was an unconstitutional interference with their right to set prices as they saw fit under free market principles. The Supreme Court upheld the ICC's decision, ruling that it was within its powers to regulate interstate commerce in such a manner so as not to discriminate unfairly between different customers or regions. This landmark decision affirmed federal regulatory power over private industry when necessary for ensuring fair competition and preventing monopolistic practices.

In the dissenting opinion for Baltimore and Ohio Southwestern Railroad Company v. United States, Justice Harlan argued that the Interstate Commerce Commission (ICC) did not have the authority to determine what constitutes a reasonable rate without first establishing that existing rates were unreasonable. He believed this was an overreach of their powers as defined by Congress in the Act to Regulate Commerce. Furthermore, he contended that it was inappropriate for courts to defer judgment on these matters entirely to administrative bodies like ICC without any standard or rule provided by legislation. In his view, such unchecked power could lead to arbitrary decisions and potential abuses of discretion which would undermine due process rights guaranteed under Fifth Amendment protections against deprivation of property without due process of law.