In the 1948 case of Propper v. Clark, the U.S. Supreme Court was asked to decide whether a receiver appointed by a New York court had standing to sue for recovery of property seized during World War II under the Trading with the Enemy Act (TWEA). The property in question belonged to an enemy alien and had been transferred to another party before being seized by the Alien Property Custodian. The receiver argued that he should be able to recover this property because it was fraudulently conveyed in violation of state law. The Supreme Court ruled against him, holding that only those who owned or held valid liens on property at the time it was vested could bring suit for its return under TWEA. It further clarified that fraudulent conveyance laws did not apply here as they would undermine federal objectives set out in TWEA - namely, preventing enemies from benefiting economically from their status during wartime. This decision affirmed federal supremacy over state law when dealing with matters related directly or indirectly with national security and foreign policy.

In the dissenting opinion for Propper v. Clark, Justice Frankfurter argued that the majority's decision to allow a receiver of an enemy corporation to sue under the Trading with Enemy Act was incorrect. He believed that this interpretation went against Congress' intent when they passed the law during World War I. According to him, Congress intended for only American citizens and corporations who had their property seized by the government during war time to be able to sue for its return once peace was restored. Allowing receivers of enemy corporations - entities which were not U.S citizens or companies - would open up floodgates of litigation from all sorts of foreign claimants whose assets were taken over by Alien Property Custodian in both world wars, thereby burdening US courts unnecessarily and potentially disrupting international relations as well.