In the case of Federal Power Commission v. Tennessee Gas Transmission Co., et al., 1962, the U.S. Supreme Court was tasked with determining whether or not the Federal Power Commission (FPC) had jurisdiction over sales for resale of natural gas in interstate commerce by a pipeline company that both produced and transported gas. The FPC argued it did have such authority under Section 1(b) of the Natural Gas Act, while Tennessee Gas contended these were direct sales not subject to FPC regulation. The court ruled in favor of the FPC, stating that even though Tennessee Gas was also involved in production activities, its primary function as an interstate transporter made it fall within regulatory purview when selling for resale purposes.

In the dissenting opinion for Federal Power Commission v. Tennessee Gas Transmission Co., it was argued that the majority's decision to uphold the Federal Power Commission's (FPC) jurisdiction over sales of natural gas by independent producers directly contradicted previous Supreme Court rulings. The dissenters believed that Congress did not intend for such sales to be regulated under the Natural Gas Act, as they were considered "production or gathering" activities rather than interstate commerce. They also contended that this interpretation would lead to an unnecessary and burdensome expansion of FPC authority, which could potentially disrupt market dynamics in a way detrimental to both producers and consumers alike. Furthermore, they criticized the majority’s reliance on policy arguments instead of statutory language when interpreting congressional intent.