Chisholm v. Georgia was a landmark Supreme Court case that established the power of federal courts to hear cases brought by citizens against states. The case arose when Alexander Chisholm, executor of the estate of Robert Farquhar, sued the state of Georgia in federal court for payment on an outstanding debt owed to his late employer. The state argued that it could not be sued without its consent and moved to dismiss the suit as unconstitutional under Article III Section 2 Clause 1 which grants jurisdiction over suits between a state and citizens from another state only with permission from Congress or if there is no other remedy available. In a 4-1 decision, Chief Justice John Jay wrote for the majority opinion affirming Chisholm's right to sue in federal court and held that Article III does not require congressional authorization before such suits can proceed. This ruling overturned long-standing precedent regarding sovereign immunity and set forth new standards for how individuals may bring claims against states in federal court going forward.

In Chisholm v. Georgia, the Supreme Court was asked to decide whether a citizen of South Carolina could sue the state of Georgia in federal court without its consent. The majority opinion held that he could, and that states were not immune from suit by citizens of other states or foreign countries in federal courts. However, Justice Iredell wrote a dissenting opinion arguing that such suits should be barred unless authorized by Congress or allowed under some treaty between two nations. He argued that allowing individuals to bring suit against their own government would lead to chaos and instability as it would give too much power to private citizens over their governments. Furthermore, he argued that if individual states had no immunity from lawsuits brought by foreign powers then they would have little protection against interference with their internal affairs which is essential for maintaining sovereignty and independence among them all.