In the Stanley v. Public Utilities Commission case of 1934, the U.S Supreme Court ruled in favor of the Public Utilities Commission (PUC). The dispute arose when PUC ordered Southern California Telephone Company to reduce its rates and refund excess charges collected from customers over a certain period. Stanley, a shareholder in the telephone company, challenged this order arguing that it was unconstitutional as it deprived him and other shareholders of their property without due process of law. He also claimed that such an action would result in confiscation since it did not allow for reasonable returns on investments made by shareholders into the company's infrastructure. The court held that while corporations have constitutional rights against unlawful takings or deprivations without due process, these rights do not extend to guaranteeing profits for investors. It further stated that public utility companies are subject to regulation by state commissions like PUC which can determine fair rates based on what is just and reasonable for both consumers and investors alike.

In the dissenting opinion for Stanley v. Public Utilities Commission, Justice Cardozo disagreed with the majority's decision to strike down a California law that regulated rates charged by privately owned public utilities. He argued that states have broad powers under their police power to regulate businesses in the interest of public welfare and safety, including setting reasonable rates for services provided by private companies operating as public utilities. The justice believed that such regulation does not constitute an unconstitutional taking without just compensation because it is within a state's legitimate authority to protect its citizens from unreasonable or discriminatory prices. Furthermore, he contended that courts should defer to legislative judgments about what constitutes a fair return on investment unless there is clear evidence of abuse or arbitrariness.