The U.S. Supreme Court case Sunray Mid-Continent Oil Co. v. Federal Power Commission in 1959 revolved around the jurisdiction of the Federal Power Commission (FPC) over natural gas companies and their sales contracts for interstate commerce, specifically when those contracts involve direct industrial consumers rather than public utilities or local distribution companies. The court ruled that under Section 1(b) of the Natural Gas Act, FPC has no jurisdiction over such sales made directly to industrial users for their own use and not for resale - a decision which overturned an earlier ruling by a lower court that had granted FPC authority in this area. This landmark decision clarified the limits of federal regulatory power regarding natural gas industries' transactions with end-users.

In the dissenting opinion for Sunray Mid-Continent Oil Co. v. Federal Power Commission, Justice Brennan argued that the majority's decision to uphold the Federal Power Commission's (FPC) jurisdiction over independent producers of natural gas was incorrect and inconsistent with previous rulings by Congress and the Supreme Court itself. He contended that this ruling would result in a significant expansion of FPC authority beyond what was intended by lawmakers when they passed relevant legislation such as Natural Gas Act. Furthermore, he expressed concern about potential negative impacts on small businesses due to increased regulatory burden imposed by FPC oversight, which could potentially stifle competition within industry sector. Lastly, he criticized majority’s interpretation of “public interest” standard used in determining whether or not certain business practices should be regulated under Natural Gas Act.