The U.S. Supreme Court case American Iron and Steel Manufacturing Co. v. Seaboard Air Line Railway in 1913 revolved around a dispute over freight charges for the transportation of iron pipes by the railway company from North Carolina to Florida, under an agreement between both parties. The manufacturing company claimed that they were overcharged based on the rates stipulated in their contract with the railway company, which was allegedly lower than what was charged. However, this rate violated Interstate Commerce Commission (ICC) regulations as it was less than officially published tariffs at that time - something unknown to both parties when entering into their agreement. The court ruled in favor of Seaboard Air Line Railway stating that ignorance of ICC regulations did not exempt them from compliance or liability for violations thereof; hence any agreements made contrary to these rules would be deemed invalid and unenforceable even if entered unknowingly.

In the dissenting opinion for American Iron and Steel Manufacturing Co. v. Seaboard Air Line Railway, Justice Holmes disagreed with the majority's ruling that a railroad company could be held liable for damages to goods during transit due to negligence in packing by the shipper. He argued that there was no evidence of any agreement between the parties which would make it incumbent on the railway company to inspect or repack goods if they were improperly packed by shippers. Furthermore, he contended that even if such an obligation existed, it did not extend beyond ensuring safe transportation under normal conditions - something which had been fulfilled in this case as per his interpretation of facts presented before court. In essence, Justice Holmes believed that liability should rest with those who pack their own shipments poorly rather than being transferred onto carriers who have no control over how these items are prepared for transport.