The U.S. Supreme Court case Oelwerke Teutonia v. Erlanger et al., 1918, involved a dispute over the payment of debts between German and American companies during World War I. The plaintiff, Oelwerke Teutonia, was a German corporation that had sold goods to the defendants (Erlanger & Galinger), an American partnership firm before the war started in 1914. However, due to wartime restrictions on trade with enemy nations imposed by the Trading with Enemy Act of 1917, payments for these transactions were held up in New York banks until after hostilities ended. Oelwerke Teutonia sued Erlanger & Galinger for non-payment but faced legal complications because it was considered an "enemy" under U.S law at that time. The court ruled against Oelwerke Teutonia stating that as long as Germany remained designated as an enemy country under US law; its citizens or corporations could not initiate lawsuits in US courts unless specifically authorized by Congress.

In the dissenting opinion for Oelwerke Teutonia v. Erlanger et al., it was argued that the majority's decision to deny jurisdiction based on a lack of diversity between parties was incorrect. The dissent maintained that, as per previous rulings and established legal principles, corporations should be treated as citizens of their state of incorporation for purposes of determining diversity jurisdiction. In this case, one party was incorporated in Germany while another had its principal place of business in New York; thus there existed sufficient diversity to confer federal court jurisdiction over the dispute. Furthermore, they contended that by denying jurisdiction due to an alleged lack of complete diversity among all members involved in a partnership firm (Erlanger & Galinger), the Court effectively created an unwarranted exception to well-established rules governing corporate citizenship and undermined predictability within jurisprudence related to subject matter jurisdictions.