In Conway v. O'Brien, the Supreme Court of the United States ruled on a case involving federal income tax law. The petitioner, Mrs. Conway, was seeking to deduct losses from her husband's estate following his death in 1931. She argued that she should be allowed to claim these deductions because they were "losses incurred in transaction entered into for profit" as defined by Section 23(e) of the Revenue Act of 1928 and corresponding Treasury Regulations. The court disagreed with Mrs. Conway's interpretation and held that such losses could not be deducted under this provision unless there was an actual sale or exchange involved - something which did not occur here since Mr. Conway had died while still owning the securities at issue. Furthermore, it clarified that even if there had been a sale or exchange leading to loss after Mr.Conway’s death, it would have been deductible only from his estate’s gross income rather than being passed onto Mrs.Conway for deduction against her personal income. This decision reinforced previous rulings stating that unrealized decreases in value are generally not recognized as deductible losses under federal tax law until realized through a sale or other disposition.

In the dissenting opinion for Conway v. O'Brien, Justice Frankfurter disagreed with the majority's decision to uphold a conviction based on evidence obtained through an illegal search and seizure. He argued that this violated the Fourth Amendment rights of the defendant, which protect against unreasonable searches and seizures. The justice believed that allowing such evidence would undermine these constitutional protections and incentivize law enforcement to engage in unlawful practices. Furthermore, he contended that excluding illegally obtained evidence from court proceedings was not only constitutionally required but also essential for maintaining public trust in the legal system.