In the case of Southern Pacific Company v. Interstate Commerce Commission, 1909, the Supreme Court examined whether a railroad company could be compelled to provide equal rates for shorter and longer hauls. The Southern Pacific Company had been charging more per mile for short-haul trips than long-haul ones on its rail line between Los Angeles and San Francisco. This practice was challenged by the Interstate Commerce Commission (ICC), which argued that it violated federal law requiring railroads to charge "reasonable" rates without undue or unreasonable preference or advantage. The Supreme Court sided with ICC, ruling that differential pricing based solely on distance traveled constituted an unjust discrimination under the Interstate Commerce Act of 1887. It held that while railways have some discretion in setting their fares due to varying operational costs over different routes, they cannot arbitrarily set higher prices for shorter distances as this would amount to unfair discrimination against certain passengers or goods. This decision reinforced ICC's regulatory authority over railway companies' rate-setting practices and affirmed its role in preventing discriminatory pricing strategies within interstate commerce.

The dissenting opinion in the case of Southern Pacific Company v. Interstate Commerce Commission argued that the majority's decision to uphold the constitutionality of a federal law regulating railroad rates was an overreach of government power. The dissenters believed that this ruling violated principles of free enterprise and individual liberty, as it allowed for excessive governmental control over private businesses. They contended that such regulation could lead to arbitrary and unfair practices, potentially harming both businesses and consumers alike. Furthermore, they questioned whether Congress had the constitutional authority to regulate interstate commerce in such a manner, suggesting that this might infringe upon states' rights. Ultimately, these justices feared that upholding this law would set a dangerous precedent for future cases involving economic regulation.