In the case of Springstead v. Crawfordsville State Bank in 1913, the U.S. Supreme Court was asked to determine whether a bank could be held liable for cashing checks that were fraudulently endorsed by an employee of the payee company without its knowledge or consent. The court ruled in favor of Crawfordsville State Bank, stating that it had acted in good faith and without negligence when it accepted and paid out on these checks since there was no reason for them to suspect any wrongdoing at the time. Furthermore, they found that responsibility lay with Springstead's employer who failed to supervise their employee adequately thereby allowing him to commit such fraudulent acts undetected over a period of time.

The dissenting opinion in the Springstead v. Crawfordsville State Bank case argued that the majority's decision was inconsistent with previous rulings and legal principles regarding promissory notes. The dissent took issue with the majority's interpretation of Indiana law, arguing that it did not support their conclusion that a bank could be held liable for accepting a fraudulent note without knowledge of its illegitimacy. They contended that under established precedent, liability should only arise if there is evidence of bad faith or negligence on part of the bank - neither of which were proven in this case. Furthermore, they disagreed with how much weight was given to certain pieces of evidence by the majority and believed other factors should have been considered more heavily when determining whether or not fraud had occurred.