In the 1933 case of Funkhouser et al. v. J.B. Preston Co., Inc., the United States Supreme Court addressed a dispute over patent rights for an invention related to oil drilling technology, specifically a device used in rotary well drilling known as "drilling mud." The plaintiffs, Funkhouser and his associates, claimed that they held exclusive patent rights to this invention and accused J.B. Preston Co., Inc of infringing upon their patent by using it without permission or compensation. The main issue at hand was whether the defendant's use of water instead of oil in their version constituted sufficient alteration to avoid infringement on the plaintiff's patented process which used oil-based fluid. The court ruled against Funkhouser and his associates stating that while they did hold a valid patent for their specific method involving an oil-based fluid, it didn't cover all possible methods involving other fluids like water employed by J.B.Preston Co., Inc.. Therefore, there was no violation or infringement committed by the defendants since changing one element (water replacing oil) resulted in a different process not covered under plaintiff’s existing patents.

The dissenting opinion in the case of Funkhouser et al. v. J.B. Preston Co., Inc., 1933, argued that the majority's decision to uphold a lower court ruling against Funkhouser and his associates was incorrect because it failed to consider key aspects of contract law. The dissenting justices believed that there had been no breach of contract by Funkhouser and his associates as they had acted within their rights under the terms agreed upon with J.B Preston Co., Inc.. They also disagreed with the majority's interpretation of 'good faith' in business dealings, arguing that this should not be used as a blanket term to cover all actions taken during negotiations or performance under a contract but rather evaluated on an individual basis for each action undertaken by parties involved in contractual agreements.