In the case of Clark v. Williard et al., Trustees, et al., 1933, the Supreme Court was asked to determine whether a receiver appointed by a federal court could sue in state court without first obtaining permission from the appointing court. The dispute arose when Clark, as receiver for an insolvent bank, attempted to recover assets that had been transferred out of the bank prior to its insolvency. The defendants argued that he lacked standing because he did not have express authorization from his appointing court to bring suit in state courts. The Supreme Court ruled against Clark and held that receivers must obtain explicit approval before initiating legal proceedings outside their appointing jurisdiction. This decision underscored the principle that receivers are officers of their respective courts and therefore subject to those courts' control and direction.

In the dissenting opinion for Clark, Receiver v. Williard et al., Trustees, et al., Justice Cardozo disagreed with the majority's decision to uphold a lower court ruling that allowed a receiver of an insolvent corporation to recover dividends paid out by the company before it went bankrupt. He argued that such payments should only be recovered if they were made while the company was insolvent or led directly to insolvency. In this case, he believed there was insufficient evidence to prove either condition had been met when these dividends were distributed. Furthermore, he pointed out that allowing receivers in bankruptcy cases to reclaim dividend payments could discourage investment and undermine confidence in corporations more broadly because shareholders would fear losing their returns if companies later became insolvent.