In the case of United States ex rel. Marcus et al. v. Hess et al., 1942, a group of electrical contractors were accused of colluding to rig bids for public works projects in Pennsylvania funded by the federal government under the Public Works Administration (PWA). The defendants argued that they could not be sued under the False Claims Act because their contracts were with local entities and not directly with the federal government, despite being federally funded. However, this argument was rejected by Supreme Court which held that even though these contracts were made locally, they involved federal funds and thus constituted fraud against U.S Government as per False Claims Act (FCA). Therefore, any conspiracy to defraud government through false claims can be prosecuted regardless if it involves direct or indirect contractual relationship with Federal Government.

In the dissenting opinion for United States ex rel. Marcus et al. v. Hess et al., Justice Roberts argued that the majority's interpretation of the False Claims Act was too broad and could potentially lead to abuse by private citizens seeking financial gain through litigation against government contractors, even in cases where no actual harm or loss had been suffered by the government itself. He also contended that this expansive reading of the statute would effectively turn it into a punitive measure rather than a remedial one, which he believed was not Congress' original intent when they enacted it during Civil War times to combat fraud against federal agencies directly involved in war efforts. Furthermore, Justice Roberts expressed concern about potential violations of defendants' due process rights under such an interpretation as well as its implications on principles of federalism given its intrusion into state affairs.