In the case of Willis v. Prudential Insurance Company of America, 1971, the U.S Supreme Court was tasked with deciding whether an insurance company could deny a claim based on a clause in their policy that excluded coverage for suicide within two years of purchasing the policy. The plaintiff's husband had purchased life insurance from Prudential and died by suicide less than two years later. The wife filed a claim which was denied by Prudential due to this exclusionary clause. She then sued for breach of contract arguing that her husband’s death should be covered because he was not mentally competent at the time he committed suicide, thus making him unable to understand his actions or their consequences. The court ruled in favor of Prudential stating that it is generally accepted in law and medicine that those who commit suicide are presumed to be suffering from some form mental illness; however, they did not find sufficient evidence proving Mr.Willis' incompetency at the time he took his own life.

The dissenting opinion in the Willis v. Prudential Insurance Company of America case argued that the majority's decision was flawed because it failed to consider relevant state law and instead applied federal common law, which they believed was inappropriate for this type of insurance dispute. They contended that the issue at hand should be governed by state contract law rather than federal common law as it involved a private insurance policy. The dissenters also expressed concern about potential negative implications on future cases involving similar disputes, arguing that applying federal common law could undermine states' rights and disrupt established legal principles related to contractual agreements between private parties. They maintained that such decisions should respect existing laws within individual states unless there is clear evidence of congressional intent to preempt them with federal legislation or regulation.