In the case of De Forest Radio Telephone Company v. United States in 1926, the U.S Supreme Court ruled that radio waves were a part of interstate commerce and thus could be regulated by federal law. The De Forest Radio Telephone Company had been convicted for violating an act which required licenses to operate radio stations; they argued this was unconstitutional as it exceeded Congress's power over interstate commerce and impinged on states' rights. However, the court upheld their conviction stating that while radio waves themselves did not cross state lines, their effects certainly did - causing interference with other signals or being picked up in different states - therefore falling under federal jurisdiction. This decision established important precedent for future regulation of broadcasting and telecommunications industries.

In the dissenting opinion for De Forest Radio Telephone Company v. United States, Justice Oliver Wendell Holmes Jr. argued that the patent in question should not have been invalidated because it was a significant improvement on existing technology and therefore met the criteria for novelty required by patent law. He contended that while some elements of Lee de Forest's invention were already known, his specific combination of these elements resulted in an entirely new device with significantly improved functionality. Furthermore, he disagreed with the majority's interpretation of prior art references used to invalidate de Forest’s patent, arguing they did not disclose all features claimed by him as novel or teach how to make his invention without undue experimentation or inventive skill beyond ordinary level.