In the case of State of New Mexico v. State of Colorado in 1924, the Supreme Court was asked to resolve a dispute between these two states over water rights from the Rio Grande River. The state of New Mexico claimed that Colorado's use and diversion of water upstream significantly reduced its own access to this vital resource, thus violating interstate compact agreements. However, after thorough examination and deliberation on evidence presented by both parties regarding their respective uses and needs for the river’s waters, as well as historical precedents concerning interstate water disputes, the court ruled in favor of Colorado. It held that there was no substantial proof showing that Colorado had violated any existing compacts or infringed upon New Mexico's equitable rights to reasonable use of Rio Grande waters within its territory.

In the dissenting opinion for the case of State of New Mexico v. State of Colorado, it was argued that Colorado should not be held responsible for damages caused by floods in New Mexico due to excessive deforestation and poor land management practices on public lands within its borders. The dissent emphasized that these were federal lands managed by federal agencies, thus any liability should rest with the federal government rather than with the state of Colorado itself. They also pointed out that there was no clear evidence linking specific actions taken in Colorado to increased flooding in New Mexico, making it difficult to establish a direct cause-and-effect relationship necessary for assigning legal responsibility. Furthermore, they suggested that holding one state financially accountable for natural disasters occurring in another could set a dangerous precedent leading to an endless series of similar lawsuits between states.