In the case of Spokane & Inland Empire Railroad Company v. United States in 1915, the Supreme Court ruled on whether a railroad company could be held liable for damages caused by its negligence. The court found that under the Hepburn Act of 1906, which regulated interstate commerce and transportation, railroads were responsible for any damage done to goods they transported across state lines due to their own negligence or failure to provide adequate care. This ruling clarified that federal law superseded any conflicting state laws regarding liability in such cases. Therefore, despite arguments from Spokane & Inland Empire Railroad Company claiming they should not be held accountable based on certain provisions within Washington State's laws, the Supreme Court upheld lower courts' decisions holding them liable for damages.

In the dissenting opinion for Spokane & Inland Empire Railroad Company v. United States, Justice Holmes disagreed with the majority's decision that a railroad company could not charge more for a shorter distance than it did for a longer one on the same line. He argued that there was no statutory provision explicitly prohibiting this practice and thus, it should be allowed under law. Furthermore, he contended that if such differential pricing were indeed illegal, then all forms of price discrimination would also have to be considered unlawful - an outcome he deemed absurd and impractical in business operations. Therefore, according to him, unless Congress specifically legislated against this type of pricing strategy or unless it resulted in clear public harm or abuse of power by monopolies (which wasn't demonstrated), courts shouldn't interfere with businesses' freedom to set their own prices based on market conditions and operational needs.