fix(transaction-controller): allow nested batch transactions with duplicate batchId when requireApproval is false

When a dapp triggers addTransactionBatch with a gas fee token, the nested
ERC-20 fee-payment transaction is submitted via addTransaction with the same
batchId as the parent batch and requireApproval: false. The existing duplicate-
batch-ID guard was incorrectly throwing DuplicateBundleId (error code 5720)
for these nested transactions.

Guard now only applies when requireApproval is not false, since nested batch
transactions always pass requireApproval: false to distinguish them from
top-level dapp duplicate attempts.

Author: matthewwalsh0

packages/transaction-controller/CHANGELOG.md

@@ -7,6 +7,11 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ## [Unreleased]
 
+### Fixed
+
+- Fix `addTransactionBatch` incorrectly throwing `DuplicateBundleId` for nested batch transactions (e.g. ERC-20 gas-fee-token transfers) that share a `batchId` with their parent batch ([#8878](https://github.com/MetaMask/core/pull/8878))
+  - The duplicate-batch-ID check now only applies when `requireApproval` is not `false`; nested transactions always pass `requireApproval: false`, correctly bypassing the guard
+
 ## [66.0.0]
 
 ### Changed

packages/transaction-controller/src/TransactionController.test.ts

@@ -3739,6 +3739,35 @@ describe('TransactionController', () => {
           networkClientId: NETWORK_CLIENT_ID_MOCK,
         });
       });
+
+      it('does not throw if duplicate and requireApproval is false (nested batch transaction)', async () => {
+        const { controller } = setupController({
+          options: {
+            state: {
+              transactions: [
+                {
+                  batchId: BATCH_ID_MOCK,
+                } as unknown as TransactionMeta,
+              ],
+            },
+          },
+          updateToInitialState: true,
+        });
+
+        const txParams = {
+          from: ACCOUNT_MOCK,
+          to: ACCOUNT_MOCK,
+        };
+
+        const { result } = await controller.addTransaction(txParams, {
+          batchId: BATCH_ID_MOCK,
+          networkClientId: NETWORK_CLIENT_ID_MOCK,
+          origin: ORIGIN_MOCK,
+          requireApproval: false,
+        });
+
+        await result.catch(() => {});
+      });
     });
   });
 

packages/transaction-controller/src/TransactionController.ts

@@ -1270,7 +1270,7 @@ export class TransactionController extends BaseController<
         (tx) => tx.batchId?.toLowerCase() === batchId?.toLowerCase(),
       );
 
-    if (isDuplicateBatchId && !isInternal) {
+    if (isDuplicateBatchId && !isInternal && requireApproval !== false) {
       throw new JsonRpcError(
         ErrorCode.DuplicateBundleId,
         'Batch ID already exists',