In the case of De Laval Steam Turbine Co. v. United States, 1931, the U.S Supreme Court ruled in favor of the government and against De Laval Steam Turbine Company. The company had sued for recovery of profits it claimed were due under a contract with the government during World War I to manufacture turbines for naval destroyers. However, an amendment to their original contract stated that any excess profit would be returned to the government if deemed unreasonable by a board appointed by President Wilson (the Naval Board). When this board determined that some profits should be returned as they exceeded reasonable amounts, De Laval refused and took legal action instead. The court held that such contracts are not unconstitutional nor do they violate public policy; rather they serve as safeguards against profiteering during times of war when materials and labor costs can fluctuate dramatically. Furthermore, it was found that there was no breach on part of the United States because all terms were agreed upon at signing including potential adjustments based on reasonableness decided by an impartial body.

In the dissenting opinion for the De Laval Steam Turbine Co. v. United States case, it was argued that the majority's decision to uphold a patent infringement claim against De Laval was incorrect because of an improper interpretation of prior patents and their significance in relation to De Laval's invention. The dissent emphasized that previous patents did not disclose any new or useful process, machine, manufacture or composition of matter which would preclude De Laval from obtaining a patent on its own design improvements. It also pointed out that earlier designs were impractical and unsuccessful until improved upon by De Laval’s innovation; therefore, they should not be used as grounds for denying them their rightful intellectual property rights. Furthermore, it contended that if every step forward based on past knowledge could be considered an infringement then progress would come to a halt since all inventions are built upon existing knowledge.