In the case of Lisa Watson, et al. v. Philip Morris Companies, Inc., et al., 2006, a group of smokers sued tobacco company Philip Morris for allegedly manipulating nicotine levels in their cigarettes to sustain addiction among consumers. The plaintiffs claimed that this manipulation violated Kansas consumer protection laws and sought damages under federal Racketeer Influenced and Corrupt Organizations Act (RICO). They also argued that because the Federal Trade Commission (FTC) had authorized certain testing methods for cigarette companies, Philip Morris was acting as a "person acting under" a federal officer which would allow removal to federal court under 28 U.S.C §1442(a)(1). However, the Supreme Court ruled against Philip Morris' claim that it was operating as a 'federal officer'. It held that private firms complying with regulatory standards do not qualify them as functioning within official federal capacity. Therefore, they are not entitled to legal protections typically reserved for government agencies or employees - including removing state cases to more favorable federal venues.

In the dissenting opinion for Lisa Watson, et al. v. Philip Morris Companies, Inc., et al., Justice Clarence Thomas argued that the majority's decision to allow removal of a case from state court to federal court based on federal officer jurisdiction was incorrect and expanded the scope of this statute beyond its intended purpose. He contended that Philip Morris did not act under a federal officer in complying with Federal Trade Commission (FTC) regulations regarding cigarette testing and therefore should not be granted removal rights typically reserved for those acting under such officers. According to him, simply complying with detailed regulatory schemes does not equate to acting under a federal official or agency as it lacks any delegation of authority from the government entity itself.