In the case of Pennsylvania Railroad Company v. Mitchell Coal & Coke Company, 1914, the Supreme Court was tasked with determining whether a railroad company could charge different rates for transporting coal to various locations. The Mitchell Coal & Coke Company argued that they were being unfairly charged higher rates than other companies by the Pennsylvania Railroad Company. They claimed this violated their rights under both state and federal law which prohibited unjust discrimination in freight charges. The court ruled in favor of the Pennsylvania Railroad Company stating that railroads have discretion over setting transportation prices as long as it does not constitute an unfair or unreasonable practice. It further clarified that charging different prices based on distance traveled is not inherently discriminatory or unlawful; rather, it's a common business practice reflecting operational costs associated with varying distances. This decision upheld railroads' right to establish pricing structures according to market conditions and logistical factors while also emphasizing their obligation to avoid undue prejudice against any particular customer group.

The dissenting opinion in the case of Pennsylvania Railroad Company v. Mitchell Coal & Coke Company argued that the majority's decision was inconsistent with previous rulings and principles of fairness. The dissent, led by Justice Holmes, contended that the railroad company should not be held liable for damages caused by a third party's negligence. In this case, an independent contractor negligently loaded coal into cars owned by Mitchell Coal & Coke Company which resulted in damage to both the coal and cars during transit on Pennsylvania Railroad’s lines. According to Holmes' interpretation of existing law, liability should only extend to parties directly responsible for causing harm or those who had control over circumstances leading up to it - neither condition being met here as per his view. He believed that imposing such liability would unjustly burden railroads with risks they could not control or predict.