In the case of Smith v. Indiana in 1903, the United States Supreme Court ruled on a dispute involving an inheritance tax law in Indiana. The plaintiff, Smith, was contesting a state law that imposed higher taxes on property inherited by distant relatives or strangers than those levied on close kin. He argued this violated his Fourteenth Amendment rights to equal protection under the law as he had been taxed at a higher rate for inheriting from his aunt's estate compared to what would have been charged if he were her child or grandchild. The court upheld the constitutionality of graded inheritance tax laws like Indiana’s and rejected Smith's claim. It reasoned that it is within states' power to classify inheritors into different categories based upon their relationship with the deceased and impose varying rates accordingly without violating equal protection principles because such classifications are not arbitrary but grounded in policy considerations related to family relationships and responsibilities.

In the dissenting opinion for Smith v. Indiana, 1903, Justice Harlan disagreed with the majority's decision to uphold a state law that allowed for separate but equal facilities based on race. He argued that this was in direct violation of the Fourteenth Amendment which guarantees equal protection under the law. Harlan believed that segregation inherently implied inferiority and thus could not be truly "equal." He also pointed out inconsistencies within segregation laws themselves - if it were truly about maintaining equality between races rather than asserting superiority or dominance, then why did these laws only apply in certain situations? For example, they didn't mandate separation in streetcars or public highways. This selective application suggested to him an ulterior motive behind such legislation: racial prejudice and discrimination disguised as legal regulation.