In Dugan et al., Executors of Clark v. The United States, the Supreme Court held that a federal court had jurisdiction to hear an action brought by executors against the United States for money due on a contract made with their testator before his death. The case arose when William Clark contracted with the government in 1809 to build two vessels for use as gunboats during the War of 1812. After Clark's death in 1817, his executors sued for payment under this contract and argued that they should be allowed to sue directly in federal court rather than having to go through state courts first. The Supreme Court agreed and found that since it was a suit between citizens of different states involving more than $500, it fell within its original jurisdiction according to Article III Section 2 of the Constitution and could therefore be heard directly by them without going through state courts first.

In the case of Dugan et al., Executors of Clark v. The United States, the Supreme Court was asked to decide whether a federal court had jurisdiction over an action for damages brought by executors against the United States. The majority opinion held that it did not have such jurisdiction because Congress had not provided any authority for such suits in its statutes or Constitution. However, Justice Story dissented from this decision and argued that since there is no express prohibition on bringing suit against the government in a federal court, then it should be assumed that Congress intended to allow these types of actions unless they were expressly prohibited by law. He further argued that if Congress wanted to prohibit these types of lawsuits then they would have done so explicitly rather than leaving them open to interpretation as implied prohibitions are too uncertain and could lead to injustice when applied inconsistently across cases.