The United States v. Pewee Coal Co., Inc. case in 1950 revolved around the issue of whether or not the U.S government was liable for a loss incurred by a coal company during its operation under federal control. During World War II, President Truman issued an executive order directing Secretary of Interior to take possession and operate most of nation's bituminous coal mines to prevent labor strikes from disrupting war production efforts. The Pewee Coal Company claimed that it suffered losses due to this action and sought compensation from the government under Fifth Amendment "takings" clause which prohibits private property being taken for public use without just compensation. The Supreme Court ruled in favor of Pewee Coal Co., stating that although the seizure was temporary, it still constituted as a 'taking' within meaning of Fifth Amendment because it involved physical invasion and occupation by Government agents who displaced owner's management team temporarily but completely, thus making U.S government liable for any losses incurred during period when mines were operated by Federal Mine Operating Agency.

In the dissenting opinion for United States v. Pewee Coal Co., Inc., Justice Robert H. Jackson argued that the government should not be held liable for damages resulting from its operation of a private business during wartime, as it was acting in its sovereign capacity to protect national interests and ensure continued coal production amidst labor disputes. He contended that such actions were taken under war powers granted by the Constitution, which do not include liability for losses incurred while operating businesses seized to prevent work stoppages threatening war production. The majority's decision, he believed, could deter future governmental intervention in times of crisis due to fear of financial repercussions. Furthermore, he disagreed with their interpretation of "just compensation," arguing it applies when property is taken permanently or temporarily for public use but does not cover operational losses suffered by government-run businesses during emergencies.