[1] The Court had previously asserted a similar jurisdiction over civil cases involving U.S. parties (see Martin v. Hunter's Lessee).

[2][3] Congress passed a bill to establish a National Lottery to raise money for the District of Columbia that was conducted by the municipal government.

[2] The Cohen firm was a leading vendor of lottery tickets in the United States through its offices in New York, Philadelphia, Charleston, and Norfolk and nationwide through the mail.

[2] Pinkney, an acquaintance of the Cohen family and a strong proponent of the necessary and proper clause and the doctrine of sovereign immunity, organized a public relations campaign on behalf of the federal government's powers in this case.

The Cohens appealed to the United States Supreme Court by arguing that their conduct was protected by the Act of Congress authorizing the D.C. lottery.

The first opinion, containing the major rulings of constitutional and historical significance, concerned Virginia's motion to dismiss for purported lack of US Supreme Court jurisdiction.

Virginia also argued that the U.S. Constitution does not give the Supreme Court appellate jurisdiction over cases in which a state is a party.

The Supreme Court relied on Article III, Section 2, of the U.S. Constitution, which grants the Supreme Court jurisdiction in "all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority."

The Court found that to be inconsistent with the language and the intent of the U.S. Constitution, including the explicit grant of judicial power to the federal courts: "There is certainly nothing in the circumstances under which our Constitution was formed, nothing in the history of the times, which would justify the opinion that the confidence reposed in the States was so implicit as to leave in them and their tribunals the power of resisting or defeating, in the form of law, the legitimate measures of the Union."

The Court found that Congress did not intend to authorize the sale of National Lottery tickets outside the District of Columbia.