In the case of Interstate Circuit, Inc. v. United States in 1938, the U.S Supreme Court ruled that a group of film distributors had violated antitrust laws by agreeing to impose certain restrictions on movie theaters at the request of Interstate Circuit, a large theater chain. The restrictions included not showing double features and maintaining minimum ticket prices for their films. Although there was no direct evidence that all distributors agreed among themselves to these terms (a horizontal agreement), they were aware that compliance from all was expected for this scheme to work effectively - creating what is known as "conscious parallelism". This constituted an illegal conspiracy under Sherman Antitrust Act even though it involved vertical agreements between each distributor and Interstate Circuit because it unreasonably restrained trade competition.

In the dissenting opinion for Interstate Circuit, Inc. v. United States (1938), Justice McReynolds argued that there was insufficient evidence to prove a conspiracy in violation of the Sherman Act among film distributors and exhibitors. He contended that the majority's decision relied on mere assumptions rather than concrete proof of an agreement between parties involved to impose restrictions on second-run theaters. Furthermore, he pointed out inconsistencies in testimonies used as evidence by the prosecution and emphasized that no distributor had admitted to entering into any such agreement or understanding with other defendants or even having knowledge about it before receiving letters from Interstate Circuit proposing these conditions. Thus, according to him, this case lacked direct proof of concerted action necessary for establishing a violation under antitrust laws.