The U.S. Supreme Court case Philadelphia & Reading Railway Company v. Di Donato in 1920 revolved around a dispute over the liability of an employer for injuries sustained by an employee during work hours. The plaintiff, Di Donato, was injured while working on a construction project for the defendant, Philadelphia & Reading Railway Company (P&RR). He sued P&RR under Pennsylvania's Workmen's Compensation Act and won compensation at both trial court level and state appellate court level. However, P&RR appealed to the U.S. Supreme Court arguing that since they were engaged in interstate commerce at the time of injury - building tracks connecting two states - federal law should apply instead of state law which would exempt them from paying compensation as per Federal Employers' Liability Act (FELA). The Supreme Court disagreed with this argument stating that although railroads are instruments of interstate commerce, not all activities performed by railroad employees necessarily constitute such commerce. In this particular case, it held that constructing new railway lines is not part of regular railway operation or maintenance but rather enhancement or expansion activity which falls under intrastate jurisdiction thus making P&RR liable to pay compensation as per Pennsylvania’s laws.

The dissenting opinion in the case of Philadelphia & Reading Railway Company v. Di Donato argued that the majority's decision to deny compensation for an injured worker was unjust and inconsistent with previous rulings. The dissent emphasized that the railway company had a clear duty to provide safe working conditions for its employees, including Mr. Di Donato, who suffered severe injuries due to negligence on part of his employer. It was pointed out that under Pennsylvania law, employers are required to compensate workers for injuries sustained during their employment regardless of whether they were negligent or not. Therefore, it was argued that denying compensation contradicted both legal precedent and principles of fairness and justice.