Cameron’s Rancho Barco claim faced uncertainty following the Mexican–American War in 1848, when most of the areas previously constituting Alta California were ceded to the United States. The California Land Act of 1851, enacted following the Treaty of Guadalupe Hidalgo and California’s admission as a state in 1850, further jeopardized Smith’s Rancho Barco holdings. Although the treaty concluded the Mexican–American War, obligating the United States to respect Mexican land grants, Smith found himself compelled to reapply to the U.S. government, substantiating his previous grant. To strengthen his case, Smith argued that a Mexican clerk had inaccurately transcribed his surname during the initial filing, hence filing this grant application under his true English name.
During this period, Smith exercised great caution to keep his small gold mining operation clandestine, avoiding a similiar fate of John Sutter, who had famously met misfortune in Sacramento to the north. In 1839, Sutter persuaded the Mexican governor to grant him lands on the Sacramento River, where he built a thriving community until the discovery of gold at Sutter’s Mill brought calamity. While constructing a water-powered sawmill, a carpenter who worked for Sutter named James W. Marshall uncovered gold flakes in a streambed in January 1848. Despite their efforts to keep the discovery secret, word spread rapidly. In 1849 gold seekers and squatters flooded Sutter’s land, pilfering and destroying his possessions and livestock. Finally, the U.S. courts denied Sutter title to his Mexican grants, leading to his financial ruin by 1852.
Cameron Smith knew he faced a similar threat, but after a protracted and costly legal battle spanning over eight years, he ultimately received a U.S. government patent for his land. Perceived as a desolate wasteland with little inherent value, Smith’s land grant was officially endorsed by President Buchanan in October 1859.