In the Stencel Aero Engineering Corp. v. United States case of 1976, the Supreme Court ruled that a third-party government contractor could not seek indemnity from the U.S. government for damages paid to an injured service member due to alleged product defects in military equipment supplied by the contractor. The plaintiff, Stencel Aero Engineering Corporation, was sued by a National Guard pilot who had been injured when his aircraft's ejection seat failed during an emergency landing; he claimed it was defective and won compensation from Stencel Aero. Subsequently, Stencil sought reimbursement from the federal government arguing that they were only following specifications provided by them (the Government). However, citing public policy reasons and extending its previous ruling in Feres v United States which established what is known as "Feres Doctrine", where active-duty members cannot sue Armed Forces for injuries arising out of or in course of activity incident to their service - Justice Marshall writing for unanimous court held that allowing such claims would involve judiciary into political questions regarding military discipline and decision-making best left with Congress or Executive branch.

In the dissenting opinion for Stencel Aero Engineering Corp. v. United States, Justice Marshall argued that the majority's decision to bar a third-party indemnity suit against the government was inconsistent with prior case law and unjustly shielded the government from liability. He contended that this ruling effectively granted immunity to military contractors for their negligence while leaving injured servicemen without adequate compensation or recourse. Furthermore, he criticized the majority’s reliance on Feres doctrine which bars service members from suing federal government for injuries "incident to service." According to him, it was not intended nor should be extended to cover suits by third parties seeking indemnification from U.S Government after being sued by an injured serviceman. In his view, such extension of Feres doctrine would only serve as a barrier preventing fair adjudication of claims arising out of contractual relationships between private contractors and U.S Government.