In the Southern Pacific Company v. United States case of 1914, the Supreme Court ruled on a dispute involving railroad freight rates. The Southern Pacific Company challenged an order from the Interstate Commerce Commission (ICC) that reduced and equalized rates for transporting certain commodities in Arizona and New Mexico territories. The company argued this was discriminatory as it did not apply to all carriers nationwide but only those operating in these areas. However, the court upheld ICC's decision stating that it had jurisdiction over such matters under its statutory authority to ensure just and reasonable rail transportation charges across states or territories without unjust discrimination or undue preference among shippers or localities.

In the dissenting opinion for Southern Pacific Company v. United States, Justice Holmes disagreed with the majority's interpretation of the Hepburn Act and its application to this case. He argued that Congress did not intend to regulate all railroad property when it passed this law but only those properties directly involved in interstate commerce. According to him, a broad interpretation would lead to absurd results as it could potentially include any property owned by a railroad company regardless of its use or connection with interstate commerce. Furthermore, he contended that such an expansive reading was unnecessary because other laws already provided sufficient regulation over these properties without resorting to an overly broad interpretation of the Hepburn Act.