Place was flying from Miami to New York when he somehow aroused the suspicion of law enforcement officers. They contacted him, and he presented ID and consented to a search of his checked luggage. The police did not search him, because his flight was due to leave in ten minutes. As they released him, he made some remark about how he had recognized that they were police officers. Because of this (?), they did a little more digging and figured out that he had listed fake addresses on his luggage tags. They called the police in New York to let them know Place was coming.
In New York, DEA agents contacted Place as he about to leave the airport with his luggage. He made the same remark about knowing that they were cops. They told him that based on their own observations and on information from Miami, they believed he was carrying narcotics. They asked for consent to search his luggage, and he refused. They told him that they were going to detain his luggage in order to get a search warrant, and gave him a choice to either accompany them or not. He chose not.
The DEA "detained" Place's luggage for about an hour and a half, then ran a dog on it. The dog alerted on one of the two bags. This was on a Friday, and they held on to the luggage until Monday when they got a warrant for the bag the dog had alerted on. There was cocaine in there, and Place was later arrested.
The trial court applied the reasoning of Terry v. Ohio to the DEA's "detention" of Place's luggage. The Court of Appeals called bullshit on the 90 minute detention, and this case found it's way to the Supreme Court.
The Court ruled that the authority to briefly detain people based on reasonable suspicion also applied to the detention of property, so the initial detention of the luggage was permissible. The court also ruled that because a K9 sniff involves such limited intrusion, and only gives the police information about the presence of contraband (which people do not have a right to possess, and therefore have no legitimate privacy interest in), a K9 sniff is not a search for fourth amendment purposes and does not require probable cause. Finally, although the court declined to put a specific time limit on investigative detentions, the court held that the facts of this case did not support a 90 minute detention of luggage. So even though this decision expanded government authority to both detain property and conduct K9 sniffs, the police in this case violated the fourth amendment and Place's conviction was reversed.