In the case of McGrath, Attorney General, as Successor to the Alien Property Custodian v. Manufacturers Trust Co., 1949, the Supreme Court was asked to determine whether or not a New York law that allowed for escheat (the reversion of property to the state when there are no legal claimants or heirs) could be applied in cases where an alien's property had been seized by the federal government during World War II. The court held that it could not; since Congress had passed laws specifically addressing how such properties should be handled and those laws did not provide for escheat, applying New York's law would conflict with federal policy. Therefore, under principles of preemption (where federal law overrides state law), New York’s statute couldn't apply in this situation.

In the dissenting opinion for McGrath v. Manufacturers Trust Co., Justice Jackson argued that the majority's decision to allow a claimant to challenge the constitutionality of vesting orders in district court, rather than exclusively through administrative procedures, undermined Congress' intent when it established those procedures. He contended that this ruling would lead to an inefficient and chaotic system where each individual case could be challenged in court, potentially leading to inconsistent rulings across different jurisdictions. Furthermore, he expressed concern about potential abuses of power by executive agencies if they were allowed unchecked discretion over property seizures without judicial review. However, he also emphasized his belief in respecting legislative decisions unless they clearly violated constitutional rights or principles.