The U.S. Supreme Court case Blodgett v. Holden, Collector in 1927 revolved around the constitutionality of a retroactive estate tax law passed by Congress. The plaintiffs were executors of an estate who argued that applying the Revenue Act of 1926 to their decedent's estate was unconstitutional because it imposed taxes retroactively and violated due process rights under the Fifth Amendment. They contended that at the time when their testator died (before enactment), there was no federal estate tax in effect, hence they could not have anticipated or planned for such taxation. However, Justice Oliver Wendell Holmes Jr., writing for a divided court, upheld the validity of this act stating that while taxing retrospectively is not generally favored, it is within Congressional power if done reasonably and with proper notice - which he found had been given here as Congress had announced its intention to enact such legislation before death occurred. Justice James Clark McReynolds dissented arguing against retrospective laws on principle; he believed them inherently unjust as they can disrupt settled expectations without providing opportunity for individuals to adjust behavior accordingly.

In the dissenting opinion for Blodgett v. Holden, Justice Oliver Wendell Holmes Jr., joined by Justices Louis Brandeis and Harlan Fiske Stone, argued that the Revenue Act of 1926 should not be applied retroactively to estates where decedents died before its enactment. They contended that this application was unconstitutional as it violated due process rights under the Fifth Amendment. The justices believed that a tax law could only apply from its date of passage forward and not retrospectively because individuals should have an opportunity to know what the law is and conform their conduct accordingly. In essence, they asserted that people cannot predict future changes in legislation or foresee how these changes might affect them financially at death; therefore, applying laws retroactively is fundamentally unfair.