The case centered on a Nebraska law that regulated the maximum number of hours that could be worked by employees in certain industries, including the baking industry.
The plaintiffs, which included several baking companies, argued that this law violated their constitutional rights, including the right to freedom of contract.
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The Court found that the law was a valid exercise of the state's police power to protect the health and safety of workers, even if it limited individual economic freedoms.
This ruling was in contrast to the Court's previous decision in Burns Baking Co.
v.
Bryan (1924), which struck down a similar Nebraska law regulating bread loaf sizes.
The Petersen Baking case established that states have the authority to regulate certain industries, like baking, in order to promote public welfare.
The Court's decision was influenced by the changing economic and social conditions of the Great Depression era, when worker protections became more important.
The case helped pave the way for other state laws regulating industries and working conditions, laying the groundwork for New Deal era labor reforms.
Despite the bakers' arguments, the Court ruled that the maximum hour law did not unconstitutionally interfere with their freedom of contract.
The decision was written by Justice Pierce Butler, who had previously ruled against state regulation of the baking industry in the Burns Baking case.
The case highlighted the evolving interpretation of the 14th Amendment's due process clause and the balance between individual economic rights and state police powers.
Legal scholars have noted that the Petersen Baking ruling foreshadowed the Court's later shift towards greater deference to economic regulations during the New Deal era.
The case is considered an important precedent in the Supreme Court's "switch in time" that allowed Roosevelt's New Deal programs to survive constitutional challenges.
Beyond the baking industry, the ruling affirmed states' ability to regulate working conditions in other industries to protect public health and safety.
The 9-0 unanimous decision in Petersen Baking demonstrated the Court's increasing willingness to uphold economic regulations during the Great Depression.