In the case of Russian Volunteer Fleet v. United States, 1930, the U.S. Supreme Court was tasked with determining whether or not a foreign government-owned corporation could be considered an "individual" under U.S. law and thus sue for damages in American courts. The Russian Volunteer Fleet (RVF), a corporation owned by the Soviet Union, had sued to recover money it claimed was owed from contracts made during World War I when RVF ships were requisitioned by the United States Shipping Board Emergency Fleet Corporation. The court ruled against RVF on two grounds: firstly that as an arm of a foreign state, it did not have standing to sue in US courts; secondly that even if it did have such standing, its claim would still fail because any contract between itself and another governmental entity is subject to sovereign immunity - meaning one cannot bring legal action against a sovereign entity like a government unless they consent to being sued. This decision reinforced principles of international law regarding sovereignty and clarified how these principles apply within American jurisprudence.

In the dissenting opinion for the case Russian Volunteer Fleet v. United States, Justice Holmes argued that the majority's decision was based on an incorrect interpretation of international law and a misunderstanding of Russia's political situation at that time. He contended that it was inappropriate to apply peacetime principles to wartime situations, as had been done in this case by treating a vessel owned by a government currently engaged in civil war as if it were privately owned. Furthermore, he disagreed with the majority’s view about recognizing governments; he believed recognition should be given not only when there is stability but also during times of upheaval or transition. In his view, denying such recognition could potentially interfere with efforts towards peace and order within nations undergoing significant changes or conflicts.