The U.S. Supreme Court case Virginia-Carolina Chemical Company v. Kirven in 1909 revolved around a dispute over the payment of dividends by the chemical company to its shareholders, including Mrs. Kirven and her children who were minority stockholders. The company had issued bonds which it later repurchased at a lower price than their face value, resulting in an apparent profit that was distributed as dividends among majority shareholders but not to Mrs.Kirven and her children due to some internal arrangements within the company's management team. Mrs.Kirven sued for her share of these dividends, arguing that they should have been shared equally among all stockholders regardless of any internal agreements within the board of directors or between certain groups of shareholders.The court ruled in favor of Mrs.Kirvin stating that when profits are made from buying back bonds below par value those profits must be used for paying off debts first before being distributed as dividends amongst all stakeholders without discrimination.

In the dissenting opinion for Virginia-Carolina Chemical Company v. Kirven, Justice Harlan disagreed with the majority's decision to reverse and remand the case back to state court. He argued that there was no reason why a federal court could not have jurisdiction over this matter as it involved diverse parties from different states. Furthermore, he believed that if a corporation operates in multiple states, then each of those operations should be considered separate entities for legal purposes. This would mean that any disputes between these entities could be resolved in federal courts under diversity jurisdiction rules rather than being limited to state courts only. In his view, limiting such cases strictly to state courts undermines the purpose of having diversity jurisdiction which is meant to prevent potential bias or prejudice against out-of-state parties by local juries and judges.