In the case of Southern Power Company v. North Carolina Public Service Company et al., 1923, the U.S Supreme Court was tasked with determining whether a federal court had jurisdiction over an interstate power dispute. The Southern Power Company (SPC), which operated in both South and North Carolina, sold electricity to the North Carolina Public Service Company (NCPSC). However, NCPSC failed to pay for services rendered by SPC due to disagreements about rates and service quality. Consequently, SPC filed suit against NCPSC in federal court seeking payment for their services. The main issue before the Supreme Court was whether this matter fell under state or federal jurisdiction since it involved companies operating across state lines but primarily concerned local operations and regulations. Ultimately, the Supreme Court ruled that despite its interstate nature, this case should be handled at a state level because it dealt primarily with issues of local concern such as public utilities regulation within one specific state -North Carolina- rather than broader matters of interstate commerce.

In the dissenting opinion for Southern Power Company v. North Carolina Public Service Company et al., Justice Holmes argued that the majority's decision was based on an incorrect interpretation of state law and a misunderstanding of the nature of interstate commerce. He contended that just because electricity generated in one state is sold and used in another, it does not automatically make it subject to federal regulation as interstate commerce. Instead, he believed this should be considered local business activity under the jurisdiction of individual states' laws rather than federal law. Furthermore, he disagreed with the majority's view that generating electricity involves creating a new product; instead, he saw it as merely changing its form from potential energy into kinetic energy - something which doesn't warrant special legal consideration or protection under patent laws.