The St. Louis, Iron Mountain & Southern Railway Company v. McKnight et al., Railroad Commissioners of the State of Arkansas case in 1916 involved a dispute over railroad freight rates set by the state's Railroad Commission. The railway company argued that these rates were unreasonably low and violated their rights under the Fourteenth Amendment to earn a fair return on their property used for public service. However, the Supreme Court ruled against them, stating that it was not within its jurisdiction to determine what constituted reasonable or unreasonable rates - this fell under state authority unless there was clear violation of federal law or constitutional rights which wasn't evident here. Therefore, as long as states acted within their power without infringing upon federal laws or constitutionally protected rights and provided due process before setting such regulations, they could establish such controls over businesses operating within their borders.

In the dissenting opinion for St. Louis, Iron Mountain & Southern Railway Company v. McKnight et al., Railroad Commissioners of the State of Arkansas, Justice Holmes argued that the majority's decision was inconsistent with previous rulings on similar cases and violated principles of federalism by allowing a state to regulate interstate commerce in ways that could potentially harm other states' interests. He contended that while states have some power to regulate businesses within their borders, they should not be allowed to do so in a way that interferes with or discriminates against interstate commerce. In this case, he believed Arkansas had overstepped its bounds by setting rates for an intrastate portion of an interstate journey without considering how those rates might affect overall costs and competition among railroads operating across multiple states.