In the United States v. Skelly Oil Co., 1968, the Supreme Court ruled on a dispute regarding jurisdiction in federal courts for declaratory judgment actions. The case arose when Skelly Oil Company sought a refund from the Internal Revenue Service (IRS) for overpayment of taxes due to an incorrect interpretation of tax laws by IRS officials. When denied, they filed suit in district court seeking a declaratory judgment that they were entitled to this refund. However, under the Federal Declaratory Judgments Act, such suits are only permitted if there is already an existing "case of actual controversy." The Supreme Court held that since no other legal action was pending or threatened against Skelly at the time they filed their suit and because federal law prohibits suits against U.S government agencies unless specifically authorized by Congress (which it had not been), there was no basis for jurisdiction in this case under either general federal question jurisdiction or specific tax-refund statutes.

In the dissenting opinion for United States v. Skelly Oil Co., Justice Black disagreed with the majority's interpretation of Section 301(a) of the Natural Gas Act, arguing that it was intended to grant jurisdiction to federal courts over all cases arising under this law. He believed that Congress had enacted this provision specifically to ensure uniformity in decisions related to natural gas regulation and prevent inconsistent state court rulings. The majority's decision, according to him, would allow companies like Skelly Oil Co. to avoid federal regulation by filing suits in state courts where they might receive more favorable judgments. This could undermine the effectiveness of national energy policy and lead to a patchwork of conflicting legal standards across different states.