In the Federal Trade Commission v. Klesner case of 1926, the Supreme Court ruled in favor of the Federal Trade Commission (FTC). The FTC had issued a cease and desist order against Jacob Klesner for unfair competition practices. Klesner was accused of selling goods at prices below cost to drive competitors out of business, then raising prices once he held a monopoly. He appealed this order on grounds that his actions were not "unfair methods of competition" as defined by Section 5 of the Federal Trade Commission Act because they did not involve deception or bad faith. However, Justice Sutherland writing for majority stated that Congress intended to stop all unfair competitive practices and it is up to FTC's discretion what constitutes an 'unfair method'. Therefore, even if there was no fraud involved in Klesner's pricing strategy but it still harmed public interest by creating monopolies which could lead to higher prices later on; hence it fell under purview of 'unfair methods' as per FTC Act.

In the dissenting opinion for Federal Trade Commission v. Klesner, Justice Stone argued that the majority's decision to dismiss the case was premature and unsupported by precedent. He contended that there were unresolved issues of fact regarding whether or not Klesner had violated Section 5 of the Federal Trade Commission Act, which prohibits unfair methods of competition in commerce. According to Justice Stone, these factual disputes should have been resolved before determining if a violation occurred. Furthermore, he disagreed with the majority's interpretation of "unfair methods," arguing it was too narrow and failed to consider public policy implications as intended by Congress when drafting this law. In his view, any practice causing substantial injury to competitors could be deemed unfair under this statute regardless if it is otherwise lawful or customary within an industry.