In the case of Fairbanks, Morse & Company et al. v. American Valve & Meter Company et al., 1927, the U.S Supreme Court ruled in favor of Fairbanks, Morse & Co., a manufacturer and seller of water meters. The dispute arose when American Valve & Meter Co., along with several other companies (all defendants), conspired to restrain trade and monopolize interstate commerce by controlling prices and distribution channels for water meters across various states - an act that was found to be in violation of the Sherman Anti-Trust Act. The court held that even though some defendants were not direct competitors with Fairbanks because they operated in different regions or dealt with different types/sizes of meters, their collective actions still significantly impacted interstate commerce as a whole due to their combined market power over meter sales nationwide.

In the dissenting opinion for Fairbanks, Morse & Company et al. v. American Valve & Meter Company et al., Justice Stone argued that the majority's decision to uphold a lower court ruling in favor of American Valve was incorrect because it failed to consider whether or not there was an actual controversy between the parties involved. He believed that Fairbanks' refusal to pay royalties on certain patents did not necessarily constitute a breach of contract, as they had only agreed to pay if those patents were valid and enforceable - something which remained unproven at trial. Furthermore, he disagreed with the majority's interpretation of patent law regarding "validity" and "infringement," arguing instead that these terms should be defined by their common usage within legal contexts rather than being subjectively determined by individual judges or courts.