In the case of Thompson v. Maxwell Land Grant and Railway Company (1897), the U.S. Supreme Court dealt with a dispute over land ownership in New Mexico. The plaintiff, Thompson, claimed that he had purchased a parcel of land from an individual who had received it as part of a Mexican grant prior to the territory becoming part of the United States. However, this parcel was also included within a larger tract granted by Congress to Maxwell Land Grant and Railway Company after New Mexico became US territory. The court ruled in favor of Maxwell Land Grant and Railway Company stating that under international law, once sovereignty changes hands all previous grants are void unless explicitly recognized by new sovereign power which wasn't done here for original Mexican grantee's rights on said property; thus making company's claim valid due to Congressional approval post-territorial acquisition.

In the dissenting opinion for Thompson v. Maxwell Land Grant and Railway Company, it was argued that the majority's decision failed to adequately consider the rights of settlers under preemption laws. The dissenting justices believed that these laws were designed to protect individuals who had settled on public lands with a view towards eventual ownership, even if those lands were later granted by Congress to corporations or other entities. They contended that such grants should not be allowed to override existing settlement claims unless there was clear evidence of Congressional intent to do so. Furthermore, they disagreed with the majority's interpretation of certain legislative acts related to land grants as implying an intention by Congress to exclude preemptors from their protections. Instead, they viewed these acts as reinforcing rather than undermining settler rights.