The Fanny was a Portuguese vessel that had been seized by the United States Navy while in American waters. The Consul-General of Portugal, as the owner of the ship, brought suit against the United States for damages caused by its seizure and detention. The Supreme Court held that although there were no statutory provisions authorizing such an action at common law, it could be maintained under principles established in international law. Furthermore, they found that even if Congress had not authorized such actions to be taken against them directly or indirectly through their agents, they would still have been liable for any damage done to foreign vessels within their jurisdiction. As a result of this ruling, foreign governments now have legal recourse when their property is wrongfully seized or damaged on American soil.

The dissenting opinion in this case argued that the United States had no right to interfere with a foreign vessel, as it was not within their jurisdiction. The court held that the Portuguese consul-general did not have any authority over the Fanny and could not bring an action against her owners or crew. Furthermore, they stated that even if he did have such authority, his claim would still be invalid because of its lack of specificity regarding damages suffered by Portugal due to the actions of those aboard the Fanny. Finally, they argued that since there was no evidence presented showing how much damage had been done to Portugal's interests by those on board the ship, then there was no basis for granting relief from liability under international law.