The Schlesinger v. Kansas City and Southern Railway Company case in 1893 revolved around a dispute over the payment of dividends by the railway company to its shareholders. The plaintiff, Schlesinger, was a shareholder who claimed that he had not received his rightful share of dividends from the company's profits due to an alleged misinterpretation of Missouri state law by the directors. He argued that under Missouri law, all net earnings should be distributed as dividends unless specifically set aside for other purposes approved by shareholders at a general meeting. However, the railway company contended that it was within their rights to retain part of these earnings for future contingencies without seeking approval from shareholders. The U.S Supreme Court ruled in favor of Kansas City and Southern Railway Company stating there were no provisions in Missouri law requiring companies to distribute all net profits as dividends or seek shareholder approval before retaining them for future needs. It held that such decisions are typically left up to corporate management unless explicitly stated otherwise in state laws or corporate charters.

The dissenting opinion in the case of Schlesinger v. Kansas City and Southern Railway Company argued that the majority's decision was inconsistent with previous rulings regarding corporate liability. The dissent emphasized that corporations should be held accountable for their actions, particularly when those actions result in harm to others. They contended that by allowing corporations to avoid responsibility for their wrongdoings, the court was undermining public trust and confidence in the legal system. Furthermore, they disagreed with the majority's interpretation of relevant statutes and believed these laws were intended to protect individuals from corporate misconduct rather than shield companies from liability.