The United States Supreme Court case of United States v. Baltimore and Ohio Southwestern Railroad Company in 1911 revolved around the interpretation of a federal statute concerning the transportation rates for government property by railroads. The U.S. Government argued that it was entitled to lower rates than those charged to private shippers, based on an 1853 law stating that the government should not be charged more "than is or shall be paid by any other party or parties for a like service." However, the railroad company contended that this provision only applied when there were existing contracts with other parties at lower rates. The Supreme Court ruled in favor of the U.S., holding that under said act, railroads are required to transport military and other property of United States, and troops, at reduced rates compared with what they charge private individuals for similar services; these charges must not exceed half of amounts paid by others under similar circumstances.

The dissenting opinion in the case of United States v. Baltimore and Ohio Southwestern Railroad Company argued that the Interstate Commerce Commission (ICC) did not have the authority to determine what constituted a reasonable rate for railroads, as this power was vested solely in Congress by virtue of its constitutional right to regulate commerce. The dissenters contended that allowing an administrative body such as the ICC to set rates would be tantamount to delegating legislative powers, which is unconstitutional. They further asserted that while it may be within the purview of courts or commissions like ICC to decide whether a particular rate is unjust or unreasonable after it has been established, they do not possess any inherent power under law or constitutionally granted authority from Congress itself, to fix what should be considered just and reasonable rates beforehand.