In the case of Texas and Pacific Railway Company v. Barrett in 1896, the U.S Supreme Court ruled on a dispute involving an injury sustained by Barrett while working for the railway company. The court had to determine whether or not federal law applied since the accident occurred during interstate commerce. The plaintiff argued that he was entitled to compensation under state law, which provided more favorable terms than federal legislation at that time. However, the defendant contended that only federal laws should apply as they were engaged in interstate commerce when the incident happened. The Supreme Court sided with Barrett ruling that state laws could indeed be used in such cases even if it involved companies engaged in interstate commerce like railroads. This decision established a precedent allowing injured workers to seek compensation under their respective state's worker protection laws rather than being limited solely to what was available federally.

In the dissenting opinion for Texas and Pacific Railway Company v. Barrett, Justice Harlan argued that the court majority erred in its interpretation of federal law regarding interstate commerce. He contended that Congress had not intended to limit state authority over intrastate activities related to interstate commerce but rather sought only to prevent states from interfering with or regulating such commerce directly. Therefore, he believed that Texas was within its rights to regulate railway companies' rates for services rendered entirely within the state's borders even if those services were part of a larger chain of events involving interstate transportation. Furthermore, he disagreed with the majority's view on what constituted "reasonable" rates set by railroads; instead of allowing courts or commissions to determine reasonableness after-the-fact based on evidence presented in individual cases, Harlan advocated for legislative bodies setting maximum allowable rates upfront as a more fair and predictable approach.