In the 1904 case of Lucius v. Cawthon-Coleman Company, the United States Supreme Court was tasked with determining whether a lower court had jurisdiction over a dispute involving two Alabama-based companies. The plaintiff, Lucius, claimed that he was owed money by the defendant for work performed under contract and sought to have his claim heard in federal court due to diversity of citizenship between him and one of the company's shareholders who resided out-of-state. However, it was determined that since both parties were incorporated in Alabama and thus considered citizens of that state for legal purposes, there wasn't sufficient diversity to justify hearing the case at federal level. Therefore, despite one shareholder residing outside Alabama which could potentially create diverse citizenships among stakeholders within a corporation as per previous rulings (Marshall v Baltimore & Ohio Railroad Co), this did not apply here because corporations are treated as separate entities from their shareholders when considering issues related to jurisdictional matters based on citizenship (Louisville R.R.Co.v Letson). Henceforth,the Supreme Court upheld lower courts' decisions dismissing Lucius’s suit due lack of jurisdiction.

The dissenting opinion in the Lucius v. Cawthon-Coleman Company case argued that the majority's decision to uphold a lower court ruling, which found in favor of Cawthon-Coleman Company, was incorrect. The dissenting justices believed that there were significant errors made during the trial process and these mistakes had an impact on its outcome. They contended that evidence presented by Lucius was improperly excluded by the trial judge, thus denying him a fair opportunity to make his case against Cawthon-Coleman Company. Furthermore, they disagreed with how certain legal principles were applied in this particular instance and felt it set a dangerous precedent for future cases involving similar circumstances or issues.