In the case of Washingtonian Publishing Co. v. Pearson et al., 1938, the U.S Supreme Court ruled in favor of Pearson and others who were sued by Washingtonian Publishing for libel. The publishing company had claimed that an article published by them was falsely represented as a paid advertisement by Pearson's radio program, causing damage to their reputation and business standing. However, the court found no evidence supporting these claims or proving malice on part of Pearson's team while presenting it as an advertisement during his broadcasted show 'Listen America'. Therefore, they dismissed all charges against him stating that there was no violation of any legal rights under common law or statutory provisions related to defamation or false advertising.

In the dissenting opinion for Washingtonian Publishing Co. v. Pearson et al., Justice Black disagreed with the majority's ruling that a magazine publisher could be held liable for libel due to an article written by an independent contractor, not an employee of the publishing company. He argued that this decision expanded liability in a way that was inconsistent with common law principles and potentially harmful to freedom of speech and press. He contended that holding publishers responsible for content they did not create or have control over would lead to self-censorship out of fear of potential lawsuits, thereby stifling free expression. Furthermore, he believed it was unfair and unreasonable to hold companies accountable for actions taken without their knowledge or consent.