In the case of Maguire and Company v. United States, 1926, the U.S Supreme Court ruled in favor of the government. The issue at hand was whether a corporation could deduct from its income tax return payments made to its officers as compensation for services rendered when such payments were not authorized by any formal action on part of the company's board of directors or shareholders until after they had been paid out. The court held that these payments were deductible because they constituted ordinary and necessary business expenses under section 234(a)(1) of Revenue Act 1918 even though there was no formal authorization prior to their disbursement. This decision clarified that corporations can claim deductions for legitimate business expenses regardless if those expenditures have been formally approved beforehand.

The dissenting opinion in the case of Maguire and Company v. United States argued that the majority's decision was a misinterpretation of Section 2(a) of the Clayton Act, which prohibits price discrimination between different purchasers if such discrimination tends to create a monopoly or substantially lessen competition. The dissenting justices believed that this provision should only apply when there is actual harm to competition, not merely potential harm as interpreted by the majority. They also disagreed with the majority's view on what constitutes "like grade and quality" under Section 2(a), arguing that it should be based on physical characteristics rather than market value or use. Furthermore, they contended that even if Maguire had violated Section 2(a), it could not have been held liable for treble damages under Section 4 because its actions were not done "in violation of" any antitrust laws but rather in good faith reliance upon an administrative ruling exempting them from liability.