In the case of McCandless, Receiver v. Furlaud et al., 1934, the United States Supreme Court dealt with a dispute over corporate dividends and stockholder rights. The plaintiff was a receiver for an insolvent corporation who sued to recover dividends paid out by the company on preferred stock while it was allegedly insolvent. The defendants were former directors of that corporation who had authorized those dividend payments. They argued they acted in good faith based on financial statements showing solvency at that time and thus should not be held liable for repayment. The court ruled in favor of the defendants, stating there is no liability if directors act in good faith reliance upon apparently accurate financial statements prepared by competent officers or accountants even if later events prove these reports inaccurate due to fraud or mistake unknown to them when making their decision about paying dividends.

In the dissenting opinion for McCandless v. Furlaud, Justice Stone argued that the majority's decision to uphold a lower court ruling was based on an incorrect interpretation of bankruptcy law. He contended that the debtor corporation should not be allowed to retain its assets while it reorganizes under Section 77B of the Bankruptcy Act because this provision only applies when there is a reasonable expectation of successful rehabilitation and solvency. In this case, he believed such an outcome was unlikely given the company's financial situation. Furthermore, he disagreed with allowing shareholders who were also creditors to vote on their own plan for reorganization as it could lead to unfair outcomes by prioritizing their interests over other creditors'. Lastly, Justice Stone criticized his colleagues' reliance on equity principles in making their decision instead of strictly adhering to statutory law.