In the 1920 case Kansas City Southern Railway Company et al. v. Road Improvement District Number 6 of Little River County, Arkansas, the U.S Supreme Court ruled in favor of the railway company. The dispute arose when a local road improvement district attempted to impose taxes on lands owned by Kansas City Southern Railway for road improvements that did not directly benefit those lands. The court held that this taxation was unconstitutional as it violated due process rights under the Fourteenth Amendment because there was no direct or special benefit conferred upon these properties from such improvements and thus constituted an unlawful taking without just compensation.

The dissenting opinion in the case of Kansas City Southern Railway Company v. Road Improvement District Number 6 of Little River County, Arkansas argued that the majority's decision was a departure from established principles and precedent regarding taxation. The dissent maintained that it is not within the purview of courts to question or interfere with tax assessments unless they are so arbitrary as to amount to confiscation. They contended that there was no evidence presented in this case suggesting such arbitrariness on part of local authorities who assessed taxes for road improvements based on benefits accruing to properties due to these improvements. Furthermore, they pointed out that railroads have been consistently held liable for similar special assessments across various jurisdictions without any constitutional objections being raised before this ruling by Supreme Court.