Odd return syntax statement

Consider the simpler example

void Main()
{
    Console.WriteLine(Foo()); // Prints 5
}

public static int Foo()
{
    return _();

    // declare the body of _()
    int _()
    {
        return 5;
    }
}

_() is a local function declared within the method containing the return statement.

This is C# 7.0 which supports local functions....

public static IEnumerable<TSource> DistinctBy<TSource, TKey>(
       this IEnumerable<TSource> source,
        Func<TSource, TKey> keySelector, IEqualityComparer<TKey> comparer)
    {
        if (source == null) throw new 
           ArgumentNullException(nameof(source));
        if (keySelector == null) throw 
             new ArgumentNullException(nameof(keySelector));

        // This is basically executing _LocalFunction()
        return _LocalFunction(); 

        // This is a new inline method, 
        // return within this is only within scope of
        // this method
        IEnumerable<TSource> _LocalFunction()
        {
            var knownKeys = new HashSet<TKey>(comparer);
            foreach (var element in source)
            {
                if (knownKeys.Add(keySelector(element)))
                    yield return element;
            }
        }
    }

Current C# with Func<T>

public static IEnumerable<TSource> DistinctBy<TSource, TKey>(
       this IEnumerable<TSource> source,
        Func<TSource, TKey> keySelector, IEqualityComparer<TKey> comparer)
    {
        if (source == null) throw new 
           ArgumentNullException(nameof(source));
        if (keySelector == null) throw 
             new ArgumentNullException(nameof(keySelector));

        Func<IEnumerable<TSource>> func = () => {
            var knownKeys = new HashSet<TKey>(comparer);
            foreach (var element in source)
            {
                if (knownKeys.Add(keySelector(element)))
                    yield return element;
            }
       };

        // This is basically executing func
        return func(); 

    }

The trick is, _() is declared after it is used, which is perfectly fine.

Pratical use of local functions

Above example is just a demonstration of how inline method can be used, but most likely if you are going to invoke method just once, then it is of no use.

But in example above, as mentioned in comments by Phoshi and Luaan, there is an advantage of using local function. Since function with yield return will not be executed unless someone iterates it, in this case method outside local function will be executed and parameter validation will be performed even if no one will iterate the value.

Many times we have repeated code in method, lets look at this example..

  public void ValidateCustomer(Customer customer){

      if( string.IsNullOrEmpty( customer.FirstName )){
           string error = "Firstname cannot be empty";
           customer.ValidationErrors.Add(error);
           ErrorLogger.Log(error);
           throw new ValidationError(error);
      }

      if( string.IsNullOrEmpty( customer.LastName )){
           string error = "Lastname cannot be empty";
           customer.ValidationErrors.Add(error);
           ErrorLogger.Log(error);
           throw new ValidationError(error);
      }

      ... on  and on... 
  }

I could optimize this with...

  public void ValidateCustomer(Customer customer){

      void _validate(string value, string error){
           if(!string.IsNullOrWhitespace(value)){

              // i can easily reference customer here
              customer.ValidationErrors.Add(error);

              ErrorLogger.Log(error);
              throw new ValidationError(error);                   
           }
      }

      _validate(customer.FirstName, "Firstname cannot be empty");
      _validate(customer.LastName, "Lastname cannot be empty");
      ... on  and on... 
  }