In the 1917 case, Board of Trade of the City of Chicago et al. v. United States, the U.S Supreme Court ruled in favor of a commodity exchange's right to establish rules for its members' trading activities. The court held that not all restraints on trade were unlawful under the Sherman Antitrust Act and introduced what is now known as "the rule of reason." This rule states that only those agreements which unreasonably restrain competition are illegal. In this case, it was argued that certain regulations imposed by the Chicago Board Of Trade could potentially limit competition among grain traders; however, these restrictions were deemed reasonable because they promoted efficiency and orderliness in markets while also protecting consumers from price manipulation or other potential abuses.

In the dissenting opinion for the Board of Trade of The City of Chicago v. United States case, Justice McKenna expressed his disagreement with the majority's interpretation and application of the Sherman Act. He argued that not all restraints on trade are inherently illegal or harmful to competition; some may even be necessary for a market to function effectively. In this particular case, he believed that the 'call rule' implemented by The Board was one such restraint - it was designed to prevent price manipulation and maintain fair trading practices in grain futures contracts, thereby promoting rather than stifling competition. Furthermore, he contended that Congress did not intend for every single contract affecting commerce to fall within its regulatory purview when it enacted antitrust laws; only those which unreasonably restrict trade should be deemed unlawful. Thus, according to him, declaring an agreement as anti-competitive merely because it imposes certain restrictions is overly simplistic and contrary to legislative intent.