In the case of Green County, Kentucky v. Quinlan in 1908, the U.S Supreme Court ruled on a dispute over bonds issued by Green County to fund railroad construction. The county had issued these bonds under an act that was later declared unconstitutional by the state court. However, Quinlan and other bondholders argued that they purchased these bonds in good faith before this ruling and should therefore be repaid with interest as promised. The Supreme Court agreed with them, stating that while it is generally true that no one can acquire rights from an unconstitutional law or contract based upon such a law; there are exceptions when parties have acted in good faith under a statute presumed to be valid at the time of their actions. Therefore, despite its subsequent invalidation by state courts due to unconstitutionality of authorizing legislation for issuance of said bonds; those who bought them prior to such determination were entitled to repayment.

The dissenting opinion in the case of Green County, Kentucky v. Quinlan argued that the county should not be held liable for damages caused by a mob's actions. The dissenters believed that it was unreasonable to hold an entire community responsible for the unlawful acts of a few individuals, especially when those individuals were acting against public sentiment and policy. They also pointed out that there was no evidence suggesting local authorities had been negligent or complicit in their duties to maintain law and order during the incident. Therefore, they concluded that while individual members of the mob could be prosecuted and held accountable for their actions, it was unjust to impose collective punishment on all residents of Green County.