In the case of Washington State v. Northern Securities Company, 1901, the U.S. Supreme Court ruled against a holding company created by railroad tycoons to monopolize rail transport in the Northwest United States. The Northern Securities Company was formed by J.P. Morgan and James J Hill who combined their competing railroads into one entity to control competition and fix prices. However, this move violated Sherman Antitrust Act which prohibits business activities that federal government regulators deem as anti-competitive or monopolistic practices. The state of Washington filed suit against Northern Securities arguing that its formation stifled competition and hurt consumers with higher prices for goods transported on these railways. The Supreme Court agreed with Washington's argument ruling that Northern Securities' monopoly over Northwestern railway traffic constituted restraint of trade under the Sherman Antitrust Act thus ordering it dissolved. This landmark decision marked one of first times when antitrust law was used to break up a monopoly and set an important precedent for future cases involving corporate consolidation or mergers deemed harmful to consumer interests due to lack of competition.

In the dissenting opinion for Washington State v. Northern Securities Company, Justice Harlan argued that the majority's interpretation of the Sherman Antitrust Act was too broad and could potentially stifle legitimate business activities. He contended that Congress did not intend to prohibit all combinations or consolidations of businesses but only those which unreasonably restrained trade or attempted to monopolize a particular industry. Furthermore, he believed that it should be up to individual states rather than federal courts to regulate corporations within their borders unless there is clear evidence of interstate commerce being affected. The justice also expressed concern about potential overreach by federal authorities in regulating private enterprise under this ruling.