In the 1991 case, Board of Governors of the Federal Reserve System v. MCorp Financial Inc., the U.S. Supreme Court examined whether federal courts had jurisdiction to prevent bank regulatory agencies from taking enforcement actions against insolvent banks under their supervision. The dispute arose when MCorp, a bank holding company in financial distress, filed for bankruptcy and sought an injunction to stop the Federal Reserve from enforcing capital adequacy regulations on its subsidiary banks. The Fifth Circuit Court ruled that it did have such jurisdiction but this was overturned by the Supreme Court which held that federal law precluded judicial review until after administrative remedies were exhausted within agency proceedings first. This decision reinforced principles of administrative law and upheld regulatory authority over banking institutions.

In the dissenting opinion for the case of BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM OF THE UNITED STATES v. MCORP FINANCIAL, INC., et al., Justice Blackmun argued that the majority's decision undermined Congress' intent in creating a comprehensive regulatory scheme for bank holding companies. He contended that by allowing bankruptcy courts to interfere with administrative proceedings initiated by federal banking agencies, it would disrupt this system and potentially harm public interests. Furthermore, he disagreed with the majority's interpretation of "custody or control" under section 362(a)(3) of Bankruptcy Code as not applying to ongoing administrative proceedings. In his view, such an interpretation was too narrow and inconsistent with prior court rulings which had broadly interpreted these terms to prevent interference from other legal forums during pending bankruptcy cases.