In the 1893 Supreme Court case Sturm v. Boker, a dispute arose over whether or not certain bonds issued by the city of Memphis were valid and should be paid. The plaintiff, Sturm, was a citizen of Germany who owned some of these bonds and sought payment from the defendant, Boker, who was acting as an agent for the city in this matter. The main issue at hand was that when these bonds were originally issued by Memphis in 1871 to fund public improvements like street paving and sewer construction; they had been declared unconstitutional by Tennessee's state supreme court because they increased municipal debt beyond limits set out in its constitution without voter approval. However, later on another series of similar bonds were validated through legislation which led to confusion about their legal status. The U.S Supreme Court ruled against Sturm stating that even though subsequent legislative action had validated other similar bond issues after-the-fact it did not retroactively validate those previously deemed unconstitutional under state law before such legislation passed. Therefore since his specific bond holdings fell into this category he could not claim repayment from Memphis via its agent Boker.

In the dissenting opinion for Sturm v. Boker, Justice Brewer argued that the majority's decision was inconsistent with previous rulings and principles of international law. He contended that a state should not be allowed to interfere in contracts between citizens of different countries, as this would violate their rights under international law. Furthermore, he disagreed with the majority's interpretation of New York’s insolvency laws and believed they were misapplied in this case. According to him, these laws were designed to protect domestic creditors from foreign debtors who might attempt to evade payment by transferring assets overseas; however, in this case it was applied against a foreign creditor seeking repayment from an American debtor which is contrary to its original intent. Thus, he concluded that the court had overstepped its bounds by allowing state law precedence over international obligations.