In 1792, South Carolina residents executing the estate of Alexander Chisholm attempted to sue the state of Georgia in the Supreme Court over payments due them for goods that Chisholm had supplied Georgia during the American Revolutionary War. U.S. Attorney General Edmund Randolph appeared to argue the case for the plaintiff before the Court. Georgia refused to appear, claiming that as a "sovereign," a state did not have to appear in Court to hear a suit against it to which it did not consent.
The Court, on a 4-1 decision, found in favor of the plaintiff, with Chief Justice of the United States John Jay concurring with Justices Blair, Wilson, and Cushing, with Justice Iredell dissenting. (At the time, there was no one "majority" opinion; the Justices simply delivered their own opinions one by one, in order from the most junior to the most senior.) It cited Article 3, Section 2 of the Constitution, which allows Federal courts the power to hear disputes between citizens and states.
Georgia's refusal to appear the court, however, had actually denied the Court's authority to hear case in which a state was a defendant. Following the decision, Georgia immediately challenged both it and the Court's own jurisdiction.
Finally, the passage of the Eleventh Amendment in 1798, which forbids Federal jurisdiction in cases when citizens of one state or foreign countries attempt to sue another state, formally removed the Court's jurisdiction in such cases. However, a citizen suing a state in state court may bring the suit to Federal court upon appeal.The Case
The Decision