In the case of National Labor Relations Board v. Newport News Shipbuilding & Dry Dock Co., 1939, the U.S Supreme Court ruled in favor of the National Labor Relations Board (NLRB). The NLRB had accused Newport News Shipbuilding & Dry Dock Company of unfair labor practices for refusing to bargain with a duly elected union and interfering with its employees' rights to self-organize. The company argued that it was not engaged in interstate commerce and therefore outside the jurisdiction of the NLRB. However, considering that shipbuilding is an industry affecting commerce as defined by Congress under Section 10(a) of National Labor Relations Act, Justice Hugo Black writing for majority held that even though ships were built for Navy Department which itself does not engage in business or trade, they are instrumentalities of interstate commerce and hence subject to regulation by Congress through NLRB.

In the dissenting opinion for National Labor Relations Board v. Newport News Shipbuilding & Dry Dock Co., Justice McReynolds expressed concern that the majority's decision would give too much power to labor unions and potentially infrive on employers' rights. He argued that while workers should have the right to organize and bargain collectively, they should not be able to force their employer into a contract against its will. The justice also questioned whether Congress had intended for such an interpretation of the National Labor Relations Act when it was passed in 1935, suggesting instead that lawmakers wanted only to prevent unfair labor practices rather than empower unions at all costs. Furthermore, he warned about potential negative consequences of this ruling on industrial relations and economic stability in general.