In the case of Randall et al. v. Board of Commissioners of Tippecanoe County, Indiana (1922), the U.S Supreme Court was asked to consider whether a local government could legally impose taxes on federal land that had been leased to private individuals or entities for agricultural purposes. The plaintiffs were tenants who farmed on federally owned land and argued they should not be subjected to local property taxes as the land belonged to the federal government, which is constitutionally exempt from such taxation under principles of sovereign immunity. However, in its decision, the court upheld an Indiana law allowing counties to tax lessees' interests in federal lands within their jurisdictions. The justices reasoned that while states cannot directly tax federal property due to constitutional intergovernmental immunities, they can indirectly tax it by imposing levies on private parties’ leasehold interests in those properties because these represent valuable rights separate from underlying ownership.

In the dissenting opinion for Randall et al. v. Board of Commissioners of Tippecanoe County, Indiana, it was argued that the majority's decision to uphold a law allowing counties to impose taxes on railroads differently than other types of property violated the Equal Protection Clause of the Fourteenth Amendment. The dissenting justices contended that there was no rational basis for treating railroad properties differently from other commercial and industrial properties in terms of taxation. They believed this differential treatment constituted an arbitrary discrimination against railroads which is not permissible under constitutional principles guaranteeing equal protection under laws. Therefore, they disagreed with upholding such discriminatory tax legislation.