The U.S. Supreme Court case Seaboard Rice Milling Company v. Chicago, Rock Island & Pacific Railway Company in 1925 revolved around a dispute over freight charges for the transportation of rice. The Seaboard Rice Milling Company had shipped its product via the railway company and later contested the rates charged by arguing that they were unreasonable and discriminatory under federal law governing interstate commerce. However, the court ruled in favor of the railway company stating that it was not within their jurisdiction to determine whether or not these rates were reasonable as this power lay with Interstate Commerce Commission (ICC). Furthermore, there was no evidence presented to suggest discrimination against Seaboard by charging them higher than other customers for similar services provided by Chicago, Rock Island & Pacific Railway Company.

The dissenting opinion in the case of Seaboard Rice Milling Company v. Chicago, Rock Island & Pacific Railway Company disagreed with the majority's ruling that a railway company could not be held liable for damages to goods transported under a bill of lading that limited liability unless negligence was proven. The dissent argued this interpretation undermined the Carmack Amendment, which intended to hold carriers accountable for damage or loss regardless of any attempts to limit their liability through contracts. They contended that allowing such limitations would incentivize carelessness and neglect by carriers who knew they were protected from full responsibility for damages. Furthermore, it was suggested that proving negligence is often impossible due to lack of access to necessary evidence on part of shippers; thus making it an unfair requirement.