In the case of Reagan v. Farmers' Loan and Trust Company, 1893, the U.S. Supreme Court was tasked with determining whether or not a Texas law that set maximum rates for railroad freight and passenger transportation violated the Fourteenth Amendment's Due Process Clause. The court ruled in favor of Farmers' Loan and Trust Company, stating that while states have the right to regulate industries within their borders for public benefit (including setting rate limits), such regulations must be reasonable and cannot result in confiscation of property without due process. In this instance, it was found that Texas’ regulation effectively reduced railroads’ income below an acceptable level which constituted as unjust confiscation under guise of regulation - thus violating constitutional rights protected by Fourteenth Amendment’s Due Process Clause.

In the dissenting opinion for Reagan v. Farmers' Loan and Trust Company, Justice Brewer argued that the majority's decision was an overreach of judicial power. He believed that it was not within the Court's jurisdiction to determine whether a state law regulating railroad rates is reasonable or not, as this should be left up to legislative bodies who are better equipped to make such decisions based on economic conditions and public policy considerations. Furthermore, he contended that if a rate set by legislation does result in confiscation of property without due process of law or denies equal protection under the laws - only then would it become unconstitutional; however, proving such claims requires clear evidence which wasn't provided in this case. Therefore, according to him, there were no grounds for declaring Texas' regulation invalid.