In the case of St. Paul Fire & Marine Insurance Co. et al. v. Barry et al., the U.S Supreme Court was tasked with determining whether a federal court in diversity jurisdiction should apply state law or federal common law when interpreting an insurance policy's "service-of-suit" clause, which governs where lawsuits under the policy may be brought and litigated. The respondents, who were insured by St.Paul Fire & Marine Insurance Company, filed suit against their insurer in a California state court for failure to defend them adequately in prior litigation; they then served process on it at its home office in Minnesota pursuant to the service-of-suit clause of their policies. The insurer removed this action to Federal District Court and moved for dismissal based on lack of personal jurisdiction or transfer venue due to inconvenience since most witnesses resided near its headquarters rather than California where plaintiffs lived. However, both lower courts denied these motions citing that such clauses are enforceable under California law as well as general maritime law (which is part of federal common law). Upon reaching Supreme Court review though, it held that interpretation of such clauses must be governed by uniform federal common-law rules instead - not individual state laws - because insurance contracts like these implicate substantial national interests.

In the dissenting opinion for St. Paul Fire & Marine Insurance Co. et al. v. Barry et al., Justice William J Brennan Jr., joined by Justices Byron White and Thurgood Marshall, disagreed with the majority's decision to allow insurance companies to deny coverage based on a policyholder's failure to cooperate in an investigation or legal proceedings related to a claim against them. The dissent argued that this ruling was overly broad and could be used unfairly against policyholders who may not fully understand their obligations under such policies or have valid reasons for non-cooperation, such as protecting their own privacy rights or avoiding self-incrimination in potential criminal matters related to the same events underlying the insurance claims.