The U.S. Supreme Court case Ickes, Secretary of the Interior v. Virginia-Colorado Development Corp., 1934 revolved around a dispute over water rights in Colorado's Rio Grande River. The Virginia-Colorado Development Corporation had been granted permission by the state to divert some of the river's flow for irrigation purposes but Harold L. Ickes, as Secretary of Interior and trustee for Pueblo Indians, challenged this on behalf of federal government arguing that it would interfere with obligations to provide water to New Mexico under an interstate compact and also deprive Pueblo Indians in New Mexico their rightful share from Rio Grande River. The court ruled against Ickes stating that he lacked standing because there was no substantial showing that proposed diversion would cause injury or breach any obligation towards Pueblos or violate interstate compact terms since Colorado was not exceeding its allocated amount under said agreement.

In the dissenting opinion for Ickes v. Virginia-Colorado Development Corp., Justice McReynolds argued that the majority's decision was incorrect because it failed to recognize a valid contract between the government and the corporation. He believed that there was sufficient evidence of an agreement, including correspondence and actions taken by both parties in reliance on this understanding. Furthermore, he disagreed with the majority's interpretation of federal law regarding water rights, arguing that Congress intended to grant such rights to private entities like Virginia-Colorado Development Corp., not just states or municipalities as suggested by his colleagues. Therefore, according to Justice McReynolds' dissenting view, denying these contractual rights constituted a breach by Secretary Ickes and his department.