The St. Louis-San Francisco Railway Company v. Alabama Public Service Commission case in 1928 revolved around the issue of whether a state could regulate interstate commerce, specifically railway rates for intrastate travel that were part of an interstate journey. The St. Louis-San Francisco Railway Company challenged the Alabama Public Service Commission's authority to set these rates, arguing it was a violation of their rights under the Commerce Clause and Fourteenth Amendment due process clause. The U.S Supreme Court ruled in favor of the Alabama Public Service Commission, stating that while Congress has power over interstate commerce, this does not entirely remove states' ability to regulate aspects within their jurisdiction even if they are part of broader commercial activities spanning multiple states. The court held that as long as there is no direct conflict with federal regulation or interference with free flow of commerce among states, such state-level regulations can stand.

In the dissenting opinion for the case of St. Louis-San Francisco Railway Company v. Alabama Public Service Commission, Justice Stone argued that the state's power to regulate commerce within its borders should not be limited by federal law unless there is a direct conflict between them. He believed that in this case, no such conflict existed and thus, Alabama had every right to enforce its own regulations on railway companies operating within its territory. The majority ruling held that federal laws governing interstate commerce superseded state laws; however, Justice Stone disagreed with this interpretation and maintained that states have inherent powers over local matters which are not explicitly given to the Federal Government by Constitution or taken away from them by it.