In the 1939 case Sheldon et al. v. Metro-Goldwyn Pictures Corp. et al., the U.S Supreme Court ruled in favor of plaintiffs, Edward Sheldon and Margaret Ayer Barnes, who claimed that their play "Dishonored Lady" had been plagiarized by Metro-Goldwyn-Mayer (MGM) for a film titled "Letty Lynton". The court found MGM guilty of copyright infringement as it was evident that significant portions of the movie were directly copied from the play without permission or proper attribution to original authors. This ruling established an important precedent in copyright law - even if only parts of a work are used without authorization, it can still constitute infringement if those parts represent substantial elements of the copyrighted work.

In the dissenting opinion for Sheldon et al. v. Metro-Goldwyn Pictures Corp. et al., Justice McReynolds argued that the majority's decision to award profits from an unauthorized film adaptation of a play was inconsistent with copyright law and could lead to excessive penalties for infringement. He contended that while copyright holders should be compensated for any harm they suffer, they are not entitled to all profits made by those who infringe their rights unless there is evidence that these were directly attributable to the copyrighted material itself. In this case, he believed it was impossible to determine how much of the film's success was due solely to its use of elements from the original play, as opposed merely being a good movie in general or having popular actors in leading roles etc., hence making such an assessment speculative at best.