In the case of Shanks v. Delaware, Lackawanna and Western Railroad Company (1915), the U.S Supreme Court ruled in favor of the railroad company. The plaintiff, Shanks, was an employee who had been injured while working for the company and sought compensation under New Jersey's Employer's Liability Act. However, his employment contract stipulated that any injuries would be handled according to Pennsylvania law - which did not provide for such compensation at that time. The court held that since both parties were aware of this clause when entering into their agreement and because it did not violate public policy or a statute explicitly prohibiting such agreements, it was enforceable as written. Therefore, despite being injured in New Jersey where he could have claimed damages under local laws if no contractual provision existed otherwise; due to his explicit acceptance of Pennsylvania law governing their relationship upon injury occurrence through his contract with defendant employer – he couldn't claim damages from them.

In the dissenting opinion for Shanks v. Delaware, Lackawanna and Western Railroad Company, Justice Holmes argued that the majority's decision was inconsistent with previous rulings of the court regarding employer liability in workplace accidents. He contended that under existing law, an employee who knowingly accepts a job with inherent risks assumes responsibility for potential injuries resulting from those known hazards. In this case, he believed that Shanks knew about the dangers associated with his work on moving trains and willingly accepted these risks as part of his employment contract. Therefore, according to Holmes' interpretation of "assumption of risk" doctrine at play here, it would be unjust to hold employers liable when employees are injured due to dangers they were aware existed within their line of work.