In Flagg Bros., Inc. v. Brooks et al., the U.S. Supreme Court ruled that a private company's actions did not constitute state action and therefore were not subject to scrutiny under the Fourteenth Amendment, which prohibits states from depriving any person of life, liberty or property without due process of law. The case involved two women whose belongings were seized by a moving storage company for nonpayment of fees; they argued this seizure violated their rights under the Fourteenth Amendment. However, because the company was privately owned and operated, its actions could not be considered as those of a state actor even though it was enforcing a New York State lien law allowing such seizures in cases of non-payment.

In the dissenting opinion for Flagg Bros., Inc. v. Brooks, Justice Thurgood Marshall argued that the majority's decision to not consider a private entity performing a public function as state action was misguided. He contended that when a private party exercises powers traditionally exclusive to the state, it should be considered as engaging in state action and thus subject to constitutional limitations. In this case, he believed that Flagg Brothers' sale of goods under New York law constituted such an exercise of power since property disposition is typically within the purview of courts rather than private entities. Furthermore, he disagreed with the majority's view on procedural due process rights being limited only by governmental actions; instead arguing these rights also apply where there is significant government involvement or influence over seemingly private conduct.