In the case of Seattle, Renton & Southern Railway Company v. State of Washington, Ex Rel. Linhoff (1913), the Supreme Court ruled in favor of the state's right to regulate public utilities within its borders. The railway company had challenged a law that allowed local governments to set rates for streetcar services, arguing it violated their rights under the Fourteenth Amendment due to lack of due process and equal protection clauses. However, Justice Hughes writing for a unanimous court held that states have broad powers over businesses serving public interests such as transportation companies and can therefore establish reasonable regulations without violating constitutional protections. This decision affirmed states' authority over local affairs and underscored their role in protecting consumers from potential abuses by monopolies or other powerful business interests.

In the dissenting opinion for Seattle, Renton & Southern Railway Company v. State of Washington, ex rel. Linhoff (1913), it was argued that the majority's decision to uphold a state law requiring railway companies to install safety appliances on their cars violated principles of federalism and encroached upon powers reserved for Congress under the Commerce Clause of the U.S. Constitution. The dissent contended that states should not be allowed to regulate interstate commerce in such a manner because it could lead to inconsistent regulations across different states, creating an undue burden on interstate commerce and potentially disrupting national economic unity. Furthermore, they believed this ruling contradicted previous Supreme Court decisions which had held that only Congress has authority over matters related with interstate commerce.