The Olmstead v. L.C., 1998 case was a landmark decision by the U.S. Supreme Court regarding disability rights and discrimination. The court ruled that under the Americans with Disabilities Act (ADA), unjustified segregation of people with disabilities constitutes discrimination, thereby requiring states to place individuals with mental disabilities in community settings rather than institutions when state treatment professionals have determined that community placement is appropriate, it is not opposed by the individual, and can be reasonably accommodated considering resources available to the state. This ruling came after two women diagnosed with mental illnesses and developmental impairments were voluntarily admitted into Georgia's psychiatric unit but remained institutionalized even after their treatment team deemed them ready for discharge into a community-based program due to lack of such programs in Georgia.

In the dissenting opinion for Olmstead v. L.C., Justice Kennedy, joined by Chief Justice Rehnquist and Justices Scalia and Thomas, argued that the majority's interpretation of Title II of the Americans with Disabilities Act (ADA) was overly broad. They contended that while Congress intended to prevent unjustified isolation of individuals with disabilities through ADA, it did not necessarily mandate deinstitutionalization or community placement in all cases. The dissenters believed that states should have more flexibility in determining how best to meet their obligations under ADA without being forced into potentially costly restructuring efforts which could strain resources away from other important services for disabled persons. Furthermore, they expressed concerns about judicial overreach and warned against courts becoming too involved in complex policy decisions better left to legislative bodies or administrative agencies.