In the Standard Oil Company of Kentucky v. State of Tennessee case in 1909, the Supreme Court examined whether a state could legally regulate prices for commodities such as petroleum products. The court ruled that states do have this power under their police powers to protect public welfare and prevent monopolies from exploiting consumers with high prices. This decision upheld a Tennessee law which set maximum retail prices for oil sold within the state, rejecting arguments by Standard Oil that it violated constitutional protections against interference with interstate commerce and deprivation of property without due process of law. The ruling affirmed states' rights to enact laws protecting consumer interests even when they affect businesses operating across state lines.

In the dissenting opinion for Standard Oil Company of Kentucky v. State of Tennessee, Justice Harlan argued that the court majority had erred in its interpretation and application of the Sherman Anti-Trust Act. He contended that this federal law was designed to prevent monopolies and protect competition, but by allowing Standard Oil's practices to continue, it undermined these goals. Harlan believed that Standard Oil’s control over oil prices through contracts with retailers constituted a restraint on trade as it limited competitors' ability to compete fairly in the market. The majority's decision not only contradicted previous rulings on similar cases but also failed to uphold Congress' intent when passing anti-trust legislation - which was meant to preserve free commerce from oppressive monopolies or combinations tending towards monopoly.