The U.S. Supreme Court case Chicago, Rock Island & Pacific Railway Company v. Perry in 1921 revolved around a dispute between the railway company and an individual named Perry over land rights. The railway company had been granted a right-of-way through public lands by Congress to construct their railroad line. However, before they could use this right-of-way, Perry acquired part of these lands under the Homestead Act and refused to allow the railway company access for construction purposes. The court ruled in favor of the Chicago, Rock Island & Pacific Railway Company stating that when Congress granted them a right-of-way through public lands it was not subject to subsequent private entry or claim under homesteading laws unless explicitly stated otherwise by Congress itself. Therefore, even though Perry obtained his title from government after the grant was made to plaintiff (railway), he took it subject to plaintiff's prior vested interest.

In the dissenting opinion for Chicago, Rock Island & Pacific Railway Company v. Perry, Justice Holmes disagreed with the majority's decision that a railway company could be held liable for injuries sustained by an employee who was not directly involved in interstate commerce at the time of his accident. He argued that such a broad interpretation of federal law would unfairly burden railroad companies and potentially infrive upon states' rights to regulate their own industries. Furthermore, he contended that it was unreasonable to expect employers to anticipate every possible scenario in which they might be held responsible for workers' safety under this expansive view of liability. Instead, he believed that liability should only apply when there is clear evidence of negligence or misconduct on part of the employer.