In the case of Hedrick v. Atchison, Topeka and Santa Fe Railroad Company in 1896, the U.S Supreme Court ruled on a dispute involving land grants given to railroad companies by Congress. The plaintiff, Hedrick, claimed ownership over certain lands that were part of these grants but had been sold to him by individuals who acquired them from the state of Kansas before they were officially granted to the defendant railroad company. The court held that even though Kansas had received title to these lands from Congress with an obligation to convey them to railroads for construction purposes, it did not have authority or right under federal law or its own laws at any time prior to granting such lands directly into railway's possession; thus could not have conveyed valid titles thereof earlier than this grant was made effective by patent issued therefor. Therefore, those who purchased such parcels from State before their official transfer date obtained no legal rights therein against said railway company which later received full title thereto as per congressional mandate.

The dissenting opinion in the case of Hedrick v. Atchison, Topeka and Santa Fe Railroad Company argued that the majority's decision was incorrect because it failed to consider the full implications of its ruling on interstate commerce. The dissenting justices believed that by allowing states to regulate railroad rates for goods transported within their borders, even if those goods were part of an interstate shipment, would effectively allow individual states to control and potentially disrupt national trade. They contended that such a power should be reserved exclusively for Congress under the Commerce Clause of the Constitution. Furthermore, they expressed concern about potential conflicts between state laws which could lead to legal uncertainty and confusion for businesses engaged in interstate commerce.