In the case of United States v. Sharpnack, the U.S. Supreme Court ruled that Congress had constitutional authority to apply all civil and criminal laws of a state to areas within that state under exclusive federal jurisdiction. The court held this power was derived from Article I, Section 8, Clause 17 of the Constitution which grants Congress complete legislative control over such territories. This decision came after William J. Sharpnack was convicted for embezzlement in Indiana on a military base under federal jurisdiction using Indiana's law against embezzlement as per Assimilative Crimes Act (ACA). He appealed his conviction arguing ACA did not constitutionally allow application of state laws on federal enclaves like military bases but his arguments were rejected by both lower courts and eventually by Supreme Court too.

In the dissenting opinion for United States v. Sharpnack, Justice Frankfurter argued that Congress did not have the authority to apply all federal criminal laws to U.S. territories and possessions without specifically stating so in each law. He believed this was a violation of due process rights as it allowed for individuals to be prosecuted under laws they may not have been aware applied to them. Furthermore, he contended that such an interpretation could lead to absurd results where certain acts would be considered crimes in some parts of the U.S., but not others, solely based on whether or not those areas were incorporated territories at the time specific legislation was passed.