In the case of Chicago Great Western Railway Company v. State of Minnesota, 1909, the U.S. Supreme Court ruled in favor of the state's right to regulate railroad rates within its borders. The railway company had challenged a law passed by Minnesota that set maximum freight and passenger rates for railroads operating in the state, arguing it violated their constitutional rights under the Fourteenth Amendment due to lack of judicial review before enforcement. However, Justice Oliver Wendell Holmes Jr., writing for a unanimous court, held that while companies have a right to fair return on property used in public service and protection from arbitrary rate setting by states; they do not have an absolute right to judicial review prior to enforcement of such regulations. This decision upheld states' power over intrastate commerce regulation and reinforced principles established earlier in Munn v Illinois (1877) which allowed government regulation where private property was "affected with public interest".

In the dissenting opinion for Chicago Great Western Railway Company v. State of Minnesota, Justice Harlan argued that the court majority had overstepped its bounds by substituting their judgment for that of a state commission in determining what constitutes reasonable railroad rates. He contended that it was not within the purview of federal courts to decide on matters concerning reasonableness and fairness of rates set by states unless there is clear violation or abuse of power which leads to injustice against railway companies. In this case, he believed no such violation occurred as Minnesota's rate-setting process involved careful investigation and consideration before deciding upon any changes. Furthermore, he stressed that if every rate established by a state could be challenged in federal courts then it would undermine states' ability to regulate businesses within their borders effectively.