In the 1923 case New York Central Railroad Company v. United States, the U.S. Supreme Court upheld a ruling that found the railroad company guilty of giving unlawful rebates to sugar refining companies in violation of the Elkins Act. The Elkins Act was enacted by Congress to prevent price discrimination and monopolies in interstate commerce by prohibiting railroads from offering rebates or special rates to certain shippers over others. The railroad company argued it should not be held liable for its employees' actions as they were acting outside their authority and against company policy when they gave these illegal discounts. However, this argument was rejected by both lower courts and ultimately, the Supreme Court which ruled that corporations could be held criminally liable for acts committed by their agents within their employment scope even if those acts violated corporate policy.

In the dissenting opinion for New York Central Railroad Company v. United States, it was argued that corporations should not be held criminally liable for the actions of their employees unless it can be proven that those in control of the corporation had knowledge and approved of these actions. The dissenting justices believed that applying criminal liability to a corporation based on an employee's misconduct could lead to unjust outcomes, as corporations cannot commit crimes or possess criminal intent in the same way individuals do. They also expressed concern about punishing innocent shareholders who have no involvement or awareness of any wrongdoing by penalizing them through fines imposed on their company. Furthermore, they suggested this approach might discourage businesses from taking risks or innovating due to fear of potential legal repercussions if an employee were to act unlawfully without corporate approval.