In the 1903 case of American Book Company v. The State of Kansas Ex Rel. Nichols, the U.S. Supreme Court ruled in favor of the state's right to regulate school textbooks prices within its jurisdiction. The American Book Company had challenged a Kansas law that set maximum retail prices for textbooks used in public schools, arguing it violated their Fourteenth Amendment rights by depriving them of property without due process and denying equal protection under the laws. However, Justice Oliver Wendell Holmes Jr., writing for a unanimous court, rejected these claims stating that states have broad powers to regulate businesses serving public interests and this regulation did not violate any constitutional provisions as long as it was reasonable and not arbitrary or discriminatory.

In the dissenting opinion for American Book Company v. The State of Kansas Ex Rel. Nichols, Justice Brewer expressed concern over the majority's decision to uphold a Kansas law that allowed state officials to determine textbook prices for public schools. He argued that this law violated the Fourteenth Amendment by depriving publishers of their property without due process of law and denying them equal protection under the laws. According to Justice Brewer, setting maximum retail prices was an arbitrary interference with private contracts and free trade principles, which could lead to unjust results if applied broadly across different industries or states. Furthermore, he contended that there were no sufficient grounds for treating textbooks as a special class subject to such regulation because they are not necessities like food or clothing nor monopolies requiring government intervention.