In the case of Chapman, Commissioner, Department of Human Resources of Texas v. Houston Welfare Rights Organization (1978), the US Supreme Court ruled on issues related to federal jurisdiction and welfare rights. The Houston Welfare Rights Organization had challenged certain state regulations that limited eligibility for Aid to Families with Dependent Children (AFDC) benefits in Texas. They argued these restrictions violated both federal law and their constitutional rights under the Fourteenth Amendment's Equal Protection Clause. The court held that a three-judge district court panel was not required for this case as it did not involve an injunction restraining enforcement or operation of a statewide regulation by state officers based on unconstitutionality; hence, single judge could hear it. On substantive matters, while they found no violation regarding AFDC standards since states have considerable latitude in allocating their available funds among categories of needy people, they remanded other claims back to lower courts for further proceedings because those were substantial constitutional claims which should be decided before reaching statutory ones.

In the dissenting opinion for Chapman v. Houston Welfare Rights Organization, Justice Thurgood Marshall argued that the majority's interpretation of 28 U.S.C §1343(3) was too narrow and inconsistent with congressional intent. He contended that Congress intended to grant federal courts jurisdiction over all civil rights cases arising under federal law, not just those involving racial discrimination or federally protected rights. Furthermore, he disagreed with the majority's view that welfare benefits are not a right but a privilege granted by the state; instead, he believed they should be considered as statutory entitlements subject to due process protections. Finally, Justice Marshall criticized the court’s decision for limiting access to federal courts for poor people seeking redress against state officials who allegedly violated their constitutional and statutory rights.