In the case of Northport Power & Light Co. v. Hartley, Governor of Washington et al., 1930, the Supreme Court ruled in favor of the state government's right to regulate private utility companies' rates for public services. The Northport Power & Light Company had challenged a law passed by the State of Washington that allowed municipalities to set their own electricity rates and required utilities to provide service at those prices. The company argued this violated its constitutional rights under due process and equal protection clauses because it was being forced into an unprofitable business arrangement without compensation or recourse for appeal. However, Justice Holmes delivered a unanimous decision upholding states' powers over local affairs including regulation of public utilities as part of their police power - even if such regulations might result in financial loss for businesses involved.

The dissenting opinion in the case of Northport Power & Light Co. v. Hartley, Governor of Washington, et al., argued that the state's action did not constitute a taking without due process or just compensation under the Fourteenth Amendment. The justice disagreed with the majority's view that there was an unconstitutional deprivation of property rights by asserting that no physical invasion or appropriation occurred and thus it cannot be considered as 'taking'. Instead, they viewed it as a legitimate exercise of police power to regulate public utilities for protecting public interests and welfare. They contended that any loss suffered by Northport Power & Light Company resulted from its failure to comply with reasonable regulations rather than direct government action against their property rights.