In the case of Davis v. O'Hara, 1924, the U.S. Supreme Court was tasked with determining whether a railroad company's agent could be held personally liable for damages resulting from an accident that occurred while he was acting within his official capacity. The plaintiff, O’Hara, had been injured in a railway accident and sought compensation from both the railway company and its agent under Section 206 of the Transportation Act of 1920. The defendant argued that as an appointed federal manager operating under governmental authority to maintain rail services during World War I, he should not be held personally responsible for accidents occurring during this period. The court ruled in favor of Davis (the defendant), stating that agents acting on behalf of government entities are generally immune from personal liability when performing their duties unless they have acted outside or beyond those duties or have violated constitutional rights. This decision clarified legal protections for individuals serving as agents for federal entities and set important precedents regarding personal versus institutional responsibility.

In the dissenting opinion for Davis, Agent of The President Under Section 206 of The Transportation Act, 1920 v. O'Hara (1924), Justice McReynolds argued that the majority's decision to uphold a lower court ruling in favor of O'Hara was incorrect. He contended that the case should have been dismissed because it lacked jurisdictional grounds as per section 206 of the Transportation Act. According to him, this provision did not grant any special authority or power to an agent appointed by the president under its terms and thus could not be used as a basis for federal jurisdiction over disputes involving such agents. Furthermore, he disagreed with how broadly his colleagues interpreted "agent" within this context and believed they were wrong in allowing O’Hara’s claim against Davis based on state law rather than federal law.