In the Supreme Court case of Supreme Lodge, Knights of Pythias v. Meyer in 1923, the court ruled on a dispute involving an insurance policy issued by the fraternal organization Knights of Pythias to one of its members. The member's wife was named as beneficiary but after her husband's death, she discovered that he had been expelled from the order before his demise and thus his life insurance policy was cancelled without notice. She sued for payment under the policy and won in lower courts. However, when appealed to the U.S Supreme Court it held that since membership in such organizations is contractual and voluntary; expulsion does not violate any rights provided due process has been observed within their rules for expulsion or suspension which were agreed upon joining. Therefore, if a member is expelled according to these procedures (which happened here), they lose all benefits including life insurance coverage even if premiums have been paid up until time of expulsion.

In the dissenting opinion for Supreme Lodge, Knights of Pythias v. Meyer, Justice Holmes disagreed with the majority's decision to uphold a lower court ruling that allowed an insurance beneficiary change without consent from the original beneficiary. He argued that this violated contract law principles and was not in line with previous decisions made by the Court on similar issues. According to Justice Holmes, when someone purchases a life insurance policy and names a beneficiary, they are entering into a binding contract which should be respected unless there is evidence of fraud or mistake. In this case, he believed there was no such evidence presented and therefore saw no reason why Meyer’s wife shouldn’t remain as his designated beneficiary despite his later attempt to change it in favor of his lodge.