In the case of Elting, Collector of Customs v. North German Lloyd in 1932, the U.S Supreme Court was tasked with deciding whether or not a ship owned by a foreign corporation but leased to an American company should be considered as American property and thus subject to customs duties under U.S law. The North German Lloyd shipping line had chartered its vessel "Bremen" to an American company for five years. Upon arrival at New York harbor, the collector of customs demanded payment of tonnage tax on grounds that it was effectively controlled by an American entity during this period and hence constituted 'American property'. However, the court ruled against this interpretation stating that despite being chartered by an American firm, ownership remained with the German company which retained significant control over major aspects such as insurance and repairs. Therefore, it could not be classified as 'American Property' for purposes of imposing custom duties.

In the dissenting opinion for Elting, Collector of Customs v. North German Lloyd, Justice McReynolds disagreed with the majority's interpretation of Section 9 of the Immigration Act. He argued that this section was not intended to impose a penalty on ship owners who brought non-immigrant aliens into U.S territory without proper documentation but rather to ensure they would take responsibility for returning such individuals if necessary. The justice believed that interpreting it as a penal statute would be contrary to its purpose and legislative history. Furthermore, he pointed out inconsistencies in applying penalties based on whether or not an alien had been admitted into the country despite their status remaining unchanged throughout their journey. In his view, these discrepancies indicated misinterpretation by the majority and unjustly burdened shipping companies while failing to effectively address immigration control issues.