In the 1933 case Pigeon River Improvement, Slide & Boom Co. v. Charles W. Cox, Ltd., the U.S Supreme Court dealt with a dispute over logging rights in boundary waters between Minnesota and Ontario, Canada. The plaintiff was an American company that had purchased timberland on both sides of the border but found its operations obstructed by Canadian customs officials who claimed jurisdiction over all logs passing through these waters regardless of their origin or destination. The defendant was a Canadian firm which held exclusive boomage rights granted by Ontario to collect fees for sorting and rafting logs downstream. The court ruled in favor of the defendant based on principles of international law and comity among nations, recognizing Canada's sovereign right to regulate commerce within its borders even when it affected cross-border transactions indirectly. It also upheld Ontario's grant as valid under Canadian law without examining whether similar state grants would be constitutional under U.S law. This decision affirmed respect for foreign legal systems while acknowledging practical realities of transnational business activities; it has been cited subsequently in cases involving conflicts between domestic regulations and international trade.

In the dissenting opinion for Pigeon River Improvement, Slide & Boom Co. v. Charles W. Cox, Ltd., Justice Cardozo disagreed with the majority's decision that Michigan law should govern the case and argued instead that Ontario law should apply as it was more relevant to the dispute at hand. He contended that since both parties were Canadian corporations operating in Canada, and their agreement was made there too, Canadian law would be most appropriate to resolve any disputes arising from their contract. Furthermore, he pointed out that even though some of the timber floated down into Michigan waters due to natural causes rather than intentional action by either party involved in this case; it did not justify applying Michigan laws over those of Ontario where all other aspects of this business transaction took place.