In the case of Louisville & Nashville Railroad Company v. United States in 1921, the Supreme Court ruled on a dispute involving railroad freight rates. The Interstate Commerce Commission (ICC) had ordered an increase in rates for southern railroads to bring them into alignment with those charged by northern railroads, arguing that this was necessary to maintain fair competition and ensure financial stability among all carriers. However, the Louisville & Nashville Railroad Company challenged this order, claiming it was arbitrary and would cause undue hardship. The Supreme Court upheld the ICC's decision stating that it fell within its regulatory authority over interstate commerce as granted by Congress under the Hepburn Act of 1906. The court found no evidence that ICC’s action was unreasonable or discriminatory; instead they were fulfilling their duty to establish just and reasonable rates while preventing undue preferences between different regions or persons. This ruling affirmed broad powers for federal agencies like ICC in regulating economic activities across state lines based on public interest considerations rather than merely responding to complaints from affected parties.

In the dissenting opinion for Louisville & Nashville Railroad Company v. United States, Justice McReynolds disagreed with the majority's ruling that allowed the Interstate Commerce Commission (ICC) to set rates for railroads. He argued that this decision was an overreach of government power and violated principles of free enterprise. According to him, Congress did not have constitutional authority to delegate its legislative powers to a regulatory body like ICC. Furthermore, he contended that such delegation could lead to arbitrary decisions by unelected officials without proper checks and balances in place. He also expressed concern about potential negative impacts on railroad companies' profitability due their inability to adjust prices based on market conditions under ICC regulation.