In the 1950 case Standard Oil Co. v. New Jersey, the U.S Supreme Court ruled that a corporation's charter could be revoked if it failed to serve its intended purpose or operated against public policy. The State of New Jersey had sought to revoke the charters of two subsidiary companies owned by Standard Oil Company on grounds that they were not serving their stated purposes and were instead being used as instruments for evading taxes in other states where Standard Oil did business. The court upheld this action, asserting that corporations are created by states for specific purposes and have no inherent right to exist beyond those stipulated in their charters; therefore, when a corporation is found acting outside these bounds or against public interest, it can be dissolved.

In the dissenting opinion for Standard Oil Co. v. New Jersey, Justice Robert H. Jackson argued that the majority's decision to allow corporations to escheat unclaimed stock dividends was a violation of due process rights under the Fourteenth Amendment. He contended that this ruling effectively allowed states to take private property without providing just compensation or adequate notice and opportunity for hearing, thereby undermining fundamental principles of fairness and justice enshrined in constitutional law. Furthermore, he expressed concern about potential abuse by state governments seeking additional revenue sources at the expense of unsuspecting shareholders who may not be aware their dividends are considered abandoned after being left unclaimed for a certain period.