In the case of Cleveland Electric Railway Company v. Cleveland and The Forest City Railway Company, 1906, the Supreme Court was asked to determine whether a city had the right to grant multiple franchises for street railway systems on public streets. The dispute arose when both companies were granted overlapping rights by different municipal bodies in Cleveland, Ohio. The court ruled that cities have an inherent power to control their own streets and can therefore grant as many franchises as they see fit without infringing upon any exclusive privileges previously given unless explicitly stated otherwise in original franchise agreements. This decision upheld lower courts' rulings which favored Forest City's claim over its competitor's objections about unfair competition due to dual franchising.

In the dissenting opinion for Cleveland Electric Railway Company v. Cleveland and The Forest City Railway Company, it was argued that the city of Cleveland did not have the authority to grant a franchise to another railway company without first obtaining consent from existing companies operating under previous franchises. It was contended that this action violated contractual obligations between the city and these pre-existing companies. Furthermore, it was suggested that granting such rights without proper compensation constituted an unlawful taking of property in violation of due process protections outlined in both state law and the Fourteenth Amendment of U.S Constitution. This perspective emphasized respect for contract rights as well as constitutional safeguards against arbitrary governmental actions infringing upon private property interests.