In the Mutual Life Insurance Company of New York v. Cohen case in 1900, the U.S Supreme Court ruled on a dispute involving an insurance policy claim. The plaintiff, Mrs. Cohen, was denied her late husband's life insurance payout by the defendant company due to alleged misrepresentation and concealment of his health condition during application for coverage. The lower court sided with Mrs.Cohen but this decision was reversed by the appellate court which held that Mr.Cohen had indeed misrepresented his health status thereby voiding his policy contractually. The Supreme Court however disagreed with this conclusion stating that there were no clear indications or evidence proving beyond reasonable doubt that Mr.Cohen intentionally deceived or concealed information from the insurer about his health condition at time of application for coverage as required under law to nullify such contracts based on fraudulence grounds.The high court therefore reinstated judgement in favor of Mrs.Cohen thus entitling her to receive full benefits from her deceased husband's life insurance policy.

In the dissenting opinion for Mutual Life Insurance Company of New York v. Cohen, Justice Harlan argued that the majority's decision was inconsistent with previous rulings and infringed upon states' rights to regulate insurance contracts within their borders. He contended that while an insurance policy may be a contract, it is also a transaction involving risk and therefore falls under state jurisdiction as per precedent set in Paul v. Virginia (1869). Furthermore, he asserted that if federal courts were allowed to intervene in such cases based on diversity jurisdiction alone - without any question of constitutionality or federal law at stake - then they would effectively become general common-law courts, which contradicts the limited role intended for them by the Constitution. In essence, Justice Harlan believed this ruling overstepped boundaries between federal and state authority and disrupted established legal principles regarding insurance regulation.