In the case of Mountain Timber Company v. State of Washington, 1916, the U.S Supreme Court upheld a law enacted by Washington state that required employers to compensate workers for injuries sustained on the job regardless of fault. The timber company argued that this law was unconstitutional as it violated their due process rights under the Fourteenth Amendment and took property without just compensation. However, in a unanimous decision led by Justice Louis Brandeis, the court ruled in favor of Washington state stating that such laws were within states' police powers to protect health and safety. This ruling established an important precedent for worker's compensation laws across America.

In the dissenting opinion for Mountain Timber Company v. State of Washington, Justice McReynolds disagreed with the majority's decision that upheld a state law requiring employers to contribute to an industrial insurance fund for worker injuries. He argued that this law violated both federal and state constitutions by depriving property owners of their rights without due process. He contended that it was unjust to force employers to pay into a fund regardless of whether they were at fault for any accidents or injuries sustained by workers on their premises. Furthermore, he believed such compulsory contributions constituted an illegal taking of property without just compensation, infringing upon constitutional protections against such actions. Lastly, he expressed concern over potential misuse and mismanagement within the system created by this legislation.