In the case of United States v. Freights, Etc., of S.S. Mount Shasta (1926), the U.S Supreme Court ruled in favor of the government's right to seize and sell cargo from a ship that had been used for illegal alcohol transportation during Prohibition. The ship, named Mount Shasta, was owned by a British company but chartered by an American firm which violated prohibition laws by transporting liquor into U.S waters. When caught, all assets including freights were seized under National Prohibition Act provisions allowing confiscation of vehicles involved in illegal liquor transport regardless if owners knew about it or not. The British owners argued they weren't aware their vessel was being used illegally and thus should retain rights over its freight earnings; however, this argument failed as ignorance wasn’t considered a valid defense under law at that time.

The dissenting opinion in the case of UNITED STATES v. FREIGHTS, ETC., OF S. S. MOUNT SHASTA argued that the majority's decision to hold a ship liable for damages caused by its cargo was incorrect and inconsistent with maritime law principles. The dissent contended that liability should be limited to the value of the vessel and pending freight, not extended to include cargo as well. They believed this extension would unfairly burden ship owners and potentially disrupt maritime commerce due to increased risk exposure for shippers who could now be held accountable for accidents beyond their control or foreseeability.