In the 1925 case Chesapeake & Ohio Railway Company v. Westinghouse, Church, Kerr & Co., Inc., the U.S Supreme Court was tasked with determining whether a contract for construction and installation of electrical equipment by Westinghouse, Church, Kerr & Co. (WCK) for Chesapeake & Ohio Railway Company constituted interstate commerce under federal law. The railway company had refused to pay WCK due to an alleged breach of warranty in their contract and argued that they were protected from legal action because the transaction fell under interstate commerce regulations which would make it subject to federal jurisdiction rather than state courts where WCK filed its suit. However, the court ruled against this argument stating that while some aspects of manufacturing may involve elements of interstate trade or transportation; simply making something intended for use in another state does not automatically qualify as engaging in interstate commerce according to existing laws at that time.

The dissenting opinion in the case of Chesapeake & Ohio Railway Company v. Westinghouse, Church, Kerr & Co., Inc., argued that the majority's decision to hold Westinghouse liable for damages was incorrect. The dissenters believed that while there may have been negligence on part of Westinghouse in failing to properly secure their machinery during transport, it did not necessarily mean they were responsible for all subsequent damage caused by a derailment. They pointed out that the railway company had an obligation as a common carrier to safely transport goods and should bear some responsibility for any failure in this duty. Furthermore, they disagreed with the majority's interpretation of "proximate cause," arguing instead that unforeseeable events such as derailments cannot be directly attributed solely to one party’s actions or omissions.