In the 1921 case Ponzi v. Fessenden et al., Charles Ponzi, a notorious swindler known for his fraudulent investment scheme (now referred to as a "Ponzi Scheme"), appealed against two trustees who had been appointed by a Massachusetts court to manage his bankrupt estate. The U.S Supreme Court was asked to determine whether federal or state law should apply in deciding if the bankruptcy trustees could void transfers of property that Ponzi made before declaring bankruptcy. The Court ruled in favor of the trustees, stating that federal law applied and thus allowed them to nullify such transfers under certain circumstances. This decision helped establish an important precedent regarding jurisdictional issues between state and federal courts in matters related to bankruptcy.

In the dissenting opinion for Ponzi v. Fessenden, Justice McReynolds argued that Charles Ponzi should not have been arrested in Massachusetts while on bail from a federal charge in another jurisdiction. He believed that this violated the principles of comity between jurisdictions and was an abuse of process by authorities who were eager to keep Ponzi incarcerated due to his notorious reputation rather than any specific legal justification. Furthermore, he pointed out inconsistencies in how different states treated similar situations, with some allowing arrests on state charges while under federal bond and others prohibiting it. This lack of uniformity troubled him as it could lead to arbitrary enforcement depending on where one was located or which officials were involved. Ultimately, he felt that the majority's decision endorsed a dangerous precedent where individuals could be subjected to multiple arrests and detentions for separate offenses without proper respect for their rights or procedural fairness.