This Supreme Court case involved a dispute between two railroad companies, the St. Louis, Alton and Terre Haute Railroad Company and the Cleveland, Columbus, Cincinnati, and Indianapolis Railway Company. The St. Louis, Alton and Terre Haute Railroad Company had a contract with the Chicago and Alton Railroad Company to use their tracks to transport freight from St. Louis to Chicago. The Cleveland, Columbus, Cincinnati, and Indianapolis Railway Company had a contract with the Chicago and Alton Railroad Company to use the same tracks to transport freight from Chicago to Indianapolis. The St. Louis, Alton and Terre Haute Railroad Company argued that the Cleveland, Columbus, Cincinnati, and Indianapolis Railway Company was infringing on their contract by using the same tracks. The Supreme Court ruled in favor of the St. Louis, Alton and Terre Haute Railroad Company, finding that the Cleveland, Columbus, Cincinnati, and Indianapolis Railway Company was in violation of the contract between the St. Louis, Alton and Terre Haute Railroad Company and the Chicago and Alton Railroad Company. The Court held that the Cleveland, Columbus, Cincinnati, and Indianapolis Railway Company was not entitled to use the tracks without the consent of the St. Louis, Alton and Terre Haute Railroad Company. The Court also held that the St. Louis, Alton and Terre Haute Railroad Company was entitled to damages for the infringement.

In St. Louis, Alton and Terre Haute Railroad Company v. Cleveland, Columbus, Cincinnati and Indianapolis Railway Company the Supreme Court was asked to decide whether a state court had jurisdiction over an interstate railroad dispute between two companies in different states. The majority opinion held that the state court did not have jurisdiction because it would interfere with Congress’s exclusive power to regulate commerce among the states under Article I of the Constitution. Justice Field dissented from this decision arguing that while Congress has authority over interstate commerce it does not extend so far as to exclude all other powers of government including those vested in individual states by their own constitutions or laws passed pursuant thereto. He argued further that if such were true then no action could be taken against any corporation engaged in interstate business without first obtaining permission from Congress which would render state courts powerless when dealing with disputes involving corporations operating across multiple jurisdictions regardless of how local they may be in nature or effect on others within a particular State's borders.