In the case of Adams Express Company v. Croninger in 1912, the U.S. Supreme Court ruled that federal law took precedence over state laws regarding interstate commerce and transportation liability limits. The dispute arose when a shipment was lost during transit from Kentucky to North Carolina, with Adams Express Company claiming they were not liable for the full value due to a contractual limitation on their liability. However, under Kentucky law such limitations were deemed invalid while North Carolina recognized them as valid if clearly stated in contract terms. The court held that since this matter involved interstate commerce it fell under federal jurisdiction according to the Carmack Amendment (an amendment regulating carriers' liabilities). Therefore, any conflicting state laws could not be applied and instead uniform national rules would govern disputes involving interstate shipments.

In the dissenting opinion for Adams Express Company v. Croninger, 1912, Justice Hughes argued that federal law should not supersede state laws in matters of interstate commerce unless there is a clear conflict between them. He believed that the Carmack Amendment to the Hepburn Act did not intend to preempt all state legislation on liability and damages related to bills of lading issued by common carriers engaged in interstate commerce. Instead, he interpreted it as setting minimum standards for carrier liability while allowing states to provide additional protections if they chose. In this case, Kentucky's law allowed shippers like Croninger more generous recovery than provided under federal statute; however, Hughes saw no direct contradiction with federal policy since Congress had not explicitly limited such recoveries or declared its intent to occupy the entire field of regulation regarding carrier liability.