In the case of Guste, Attorney General of Louisiana, et al. v. Jackson et al., 1976, the U.S Supreme Court was asked to decide on a dispute concerning public housing in New Orleans. The plaintiffs were tenants who had been relocated due to urban renewal projects and they argued that their rights under the Housing Act of 1937 had been violated because they were not given priority for new public housing units built in their former neighborhoods. They also claimed racial discrimination as most affected tenants were African American while most beneficiaries from new developments were white residents moving into newly gentrified areas. The court ruled against them stating that there was no explicit requirement in federal law mandating local authorities give such preference to displaced persons when allocating new public housing units nor did it find evidence supporting claims of intentional racial discrimination by city officials or agencies involved with these redevelopment projects.

In the dissenting opinion for GUSTE, ATTORNEY GENERAL OF LOUISIANA, et al. v. JACKSON et al., 1976, Justice Stevens argued that the majority's decision was an overreach of judicial power and a violation of states' rights to regulate their own affairs. He contended that Louisiana had a legitimate interest in regulating its nursing homes to ensure quality care for residents and protect them from potential abuses or neglect by unqualified personnel or inadequate facilities. The state law requiring licensing of nursing home administrators did not violate any constitutional provisions according to him; rather it served as a necessary measure for public safety and welfare within the state’s jurisdictional boundaries. Furthermore, he disagreed with the majority's interpretation of "occupational liberty" under Fourteenth Amendment due process clause which they used as basis for striking down Louisiana’s statute on grounds it interfered with individuals’ right to pursue lawful employment without unreasonable governmental interference.