In the case of Sultan Railway & Timber Company v. Department of Labor and Industries of the State of Washington, 1927, the Supreme Court ruled in favor of the state department. The dispute centered around a law enacted by Washington State that required companies to pay into an industrial insurance fund as compensation for injured workers. Sultan Railway & Timber Company argued this was unconstitutional because it violated their due process rights under the Fourteenth Amendment. However, Justice Harlan Fiske Stone wrote in his opinion that there was no violation since employers were not deprived any property without due process; they had ample opportunity to be heard before assessments were made against them for payment into said fund. Furthermore, he stated that such laws are within states' police powers to protect welfare and safety of its citizens - including employees who may suffer workplace injuries.

In the dissenting opinion for Sultan Railway & Timber Company v. Department of Labor and Industries of the State of Washington, Justice Sutherland argued that the majority's decision violated principles of due process by imposing an unfair burden on employers. He contended that it was unreasonable to hold companies responsible for injuries sustained by employees during their commute to work, as these were not directly related to their employment duties or conditions. Furthermore, he asserted that this ruling would create a dangerous precedent which could lead to excessive litigation and financial strain on businesses. In his view, such expansive interpretation of workers' compensation laws exceeded constitutional bounds and infringed upon employer rights without sufficient justification or benefit in terms of improving worker safety.