The case of McLain v. Real Estate Board of New Orleans, Inc., revolved around the issue of whether federal antitrust laws applied to a local real estate market that was not directly involved in interstate commerce but had substantial effects on it. The plaintiffs, two independent real estate brokers from Louisiana, alleged that the defendants (the Real Estate Board and multiple other brokerage firms) conspired to fix commission rates for residential property sales services in violation of Section 1 of the Sherman Act. The Supreme Court held that while direct involvement in interstate commerce is not necessary for federal jurisdiction under the Sherman Act, there must be a "substantial effect" on interstate commerce resulting from the defendant's activities. In this case, since home sales often involve out-of-state financing and insurance companies which are elements affecting interstate commerce substantially enough to warrant application of federal antitrust laws - thus reversing lower court’s dismissal due to lack thereof.

In the dissenting opinion for McLain v. Real Estate Board of New Orleans, Justice William Rehnquist argued that the majority's decision expanded federal jurisdiction too broadly under the Sherman Act. He contended that there was no substantial evidence to suggest that defendants' activities had a direct and significant effect on interstate commerce, which is necessary to invoke federal antitrust laws. The mere fact that real estate transactions may involve out-of-state financing or insurance does not automatically mean they have such an impact on interstate commerce as required by law. Furthermore, he criticized the majority's reliance on "practical economics" rather than legal precedent in their ruling, stating it could lead to arbitrary results and uncertainty in future cases involving similar issues.