In the case of St. Cloud Public Service Company v. City of St. Cloud (1923), the U.S Supreme Court ruled in favor of the City of St. Cloud, upholding its right to purchase a local utility company's property through eminent domain for public use as per their franchise agreement, despite objections from the utility company that it was not being adequately compensated and that this constituted an unlawful seizure under the Fourteenth Amendment. The court found no evidence supporting these claims and held that just compensation had been provided by assessing fair market value at $150,000 plus interest accrued since initiation proceedings began - a total sum which exceeded initial investment costs by over 50%. The decision affirmed municipal authority to regulate utilities within their jurisdiction while also protecting private property rights against arbitrary government action.

In the dissenting opinion for St. Cloud Public Service Company v. City of St. Cloud, Justice McReynolds disagreed with the majority's decision to uphold a Minnesota statute that allowed cities to purchase public utilities without providing compensation for unexpired franchise rights. He argued that this was an unconstitutional taking of property without just compensation, violating the Fourteenth Amendment's Due Process Clause. The justice contended that when a city grants a franchise right to operate within its limits, it is essentially granting a contract which should be respected and protected under law; thus, he believed any attempt by the state or municipality to confiscate such rights without fair payment would amount to an infringement upon contractual obligations and property rights as guaranteed by constitutionally enshrined principles of due process and equal protection under law.