The U.S. Supreme Court case Farmers' Loan and Trust Company v. Penn Plate Glass Company in 1901 revolved around a dispute over the foreclosure of a mortgage on real estate property owned by the Penn Plate Glass Company, which was located in Pennsylvania but incorporated under West Virginia laws. The Farmers' Loan and Trust Company, as trustee for bondholders who held bonds secured by this mortgage, sought to foreclose due to non-payment of interest. However, the glass company argued that it had been fraudulently induced into issuing these bonds and granting the mortgage as security for them. The court ruled in favor of Farmers' Loan and Trust Co., stating that even if there were fraudulent inducement involved when originally issuing these securities (which wasn't proven), this wouldn't affect their validity or enforceability against third parties like bondholders who purchased them without knowledge of any alleged frauds. Therefore, they could still be used as valid collateral for loans provided by such third parties.

In the dissenting opinion for Farmers' Loan and Trust Company v. Penn Plate Glass Company, it was argued that the majority's decision to uphold a lower court ruling - which found in favor of a bondholder who sued after not receiving payment due to an alleged technicality - was incorrect. The dissenting justices believed that this interpretation unfairly penalized corporations for minor errors or oversights, even when they had otherwise fulfilled their obligations in good faith. They also expressed concern about the potential implications of such a precedent on future cases involving corporate bonds and other similar securities, suggesting it could lead to unnecessary litigation and financial instability. Furthermore, they disagreed with the majority's view that bondholders should be entitled to sue individually rather than collectively through trusteeship arrangements as typically stipulated by bond agreements.