In the case of Fallows v. Continental & Commercial Trust & Savings Bank, Trustee in Bankruptcy of Tengwall Company (1914), the U.S Supreme Court was tasked with determining whether a bankruptcy trustee could recover payments made by an insolvent debtor to a creditor within four months prior to filing for bankruptcy. The defendant, Continental and Commercial Trust and Savings Bank, had received payment from Tengwall Company before it filed for bankruptcy. The plaintiff, Fallows as trustee in bankruptcy for Tengwall Company argued that this payment should be returned as it constituted preferential treatment under Section 60b of the Federal Bankruptcy Act which prohibits such transactions. The court ruled in favor of the bank stating that there was no evidence showing that at the time when these payments were made, either party believed insolvency or impending bankruptcy was imminent. Therefore they did not constitute preferential transfers since they lacked fraudulent intent or knowledge about forthcoming insolvency on part of both parties involved - essential elements required by law to establish preference.

The dissenting opinion in the Fallows v. Continental & Commercial Trust & Savings Bank case argued that the majority's decision to uphold a lower court ruling, which allowed a bank to claim priority over other creditors for debts owed by a bankrupt company, was incorrect. The dissenting justices believed that this interpretation of bankruptcy law unfairly favored banks and financial institutions at the expense of other types of creditors. They contended that all unsecured creditors should be treated equally under bankruptcy law and not have their claims subordinated to those of banks or trust companies acting as trustees. Furthermore, they disagreed with the majority's view on what constituted 'notice' regarding insolvency proceedings, arguing it should include actual knowledge rather than mere constructive notice.