In the 1912 case of Cameron Septic Tank Company v. City of Knoxville, Iowa, the U.S Supreme Court dealt with a dispute over patent rights and municipal authority. The Cameron Septic Tank Company held a patent for a specific type of septic tank system and had contracted with the city to install this system throughout Knoxville. However, after some installations were completed, the city decided to continue installing similar systems without further involvement from or payment to Cameron Septic Tank Co., arguing that as a municipality it was not bound by federal patent laws. The company sued for infringement on their patented design. The Supreme Court ruled in favor of the City of Knoxville stating that municipalities have certain implied powers necessary for self-preservation which include public health measures such as sewage disposal systems; therefore they are exempted from adhering strictly to federal patent laws when acting within these capacities. This ruling established an important precedent regarding how far municipal authority extends into areas typically governed by federal law.

The dissenting opinion in the case of Cameron Septic Tank Company v. City of Knoxville, Iowa argued that the city's ordinance was not an unreasonable exercise of its police power and did not infrally upon any constitutional rights. The justice believed that it is within a municipality's right to regulate businesses for public health and safety reasons, even if these regulations may affect certain businesses adversely. In this particular case, they felt that requiring septic tank companies to obtain permits before operating within city limits was a reasonable measure designed to protect public health by ensuring proper waste disposal practices were followed. They also disagreed with the majority view that this regulation constituted an unlawful restraint on interstate commerce since it applied equally to all septic tank companies regardless of where they were based or whether their business crossed state lines.