In the case of Navarro Savings Association v. Lee, the U.S. Supreme Court ruled in favor of a group of trustees who were managing a real estate investment trust under Massachusetts law. The dispute arose when Navarro Savings Association sued to foreclose on property that was part of the trust's assets, and named both the trustees and beneficiaries as defendants. The court held that for purposes of diversity jurisdiction - which allows federal courts to hear cases involving citizens from different states - only citizenships of trustees should be considered rather than those of all beneficiaries involved in an express business trust like this one. This decision clarified how trusts are treated under federal diversity jurisdiction rules: it is not necessary to consider every single beneficiary’s state citizenship; instead focus lies on where the trustee(s) reside or do business.

In the dissenting opinion for Navarro Savings Association v. Lee, Justice William Rehnquist disagreed with the majority's interpretation of federal diversity jurisdiction rules. He argued that a trust cannot be considered a citizen separate from its trustees and beneficiaries under 28 U.S.C §1332(a). According to him, this statute requires complete diversity between all plaintiffs and defendants in a lawsuit; therefore, if any trustee or beneficiary is from the same state as any opposing party, then there is no diversity jurisdiction. He also criticized the majority for creating an exception to this rule by allowing trusts managed by independent trustees to sue or be sued in their own names without considering citizenship of beneficiaries. This decision could lead to forum shopping because it allows parties who would not otherwise have access to federal courts due to lack of complete diversity among participants involved in litigation process now being able use these institutions simply because they are part of certain type of trust arrangement.