In the United States v. Rock Royal Co-operative, Inc., et al., 1938 case, the Supreme Court upheld federal regulation of milk marketing under the Agricultural Marketing Agreement Act of 1937. The defendant, a dairy cooperative in New York State, argued that such regulations violated their rights to due process and equal protection under law as well as exceeded Congress's commerce clause powers. However, the court ruled in favor of government intervention on grounds that it was necessary to stabilize prices and ensure fair competition within an industry vital for public welfare. This decision affirmed broad congressional authority over interstate commerce and reinforced federal power to regulate agricultural markets for economic stability.

In the dissenting opinion for United States v. Rock Royal Co-Operative, Inc., Justice McReynolds argued that the Agricultural Marketing Agreement Act of 1937 was unconstitutional because it delegated legislative power to the Secretary of Agriculture and violated due process rights. He contended that Congress had improperly given its law-making powers to an executive branch official by allowing him to determine milk prices without clear guidelines or standards. Furthermore, he believed this delegation infringed upon farmers' property rights without proper judicial review or opportunity for defense, thereby violating their Fifth Amendment protections. The majority's interpretation of "public interest" as a sufficient standard for price-setting was seen by Justice McReynolds as too vague and subjective, leading to potential arbitrary action from government officials.