In the case of McCardle et al. v. Indianapolis Water Company, 1926, the U.S Supreme Court ruled in favor of the water company. The dispute arose when a group of taxpayers filed suit against both their city and its contracted water supplier, alleging that rates set by an ordinance were excessive and thus unconstitutional under Indiana law which required charges to be reasonable and just. They sought to prevent collection of these fees until proper rates could be established through court proceedings or other means. However, the Supreme Court held that while courts may intervene if there is clear abuse or discrimination present in rate-setting practices, they should not interfere with legislative decisions regarding public utility pricing unless such issues are evident - as was not found to be true in this instance.

The dissenting opinion in the McCardle et al. v. Indianapolis Water Company case argued that the majority's decision was a departure from established legal principles and precedent, particularly regarding property rights and eminent domain laws. The dissent contended that the water company had acquired its franchise under state law, which granted it certain rights to use specific land for its operations. These rights were considered as property by the dissenting justices who believed they should be protected under constitutional provisions against unlawful seizure or interference without just compensation. They disagreed with the majority's view that these rights could be altered or revoked unilaterally by municipal authorities without due process of law or fair compensation, arguing this undermined fundamental principles of justice and fairness enshrined in American jurisprudence.