Freight Damage Claim Denied or Lowballed: Your Rights Under the Carmack Amendment
Last updated: November 2026. Reviewed by Pavel Kolmogorov, California business litigation attorney (State Bar No. 321018).
When an interstate trucking company loses or damages freight, a federal law called the Carmack Amendment makes the carrier liable for the actual loss or injury to the property. A token offer may rest on a liability limit in the bill of lading, and that limit holds only if the carrier took the steps the law requires. A carrier may not give a California business less than nine months to file a written claim. Kolmogorov Law, P.C., a business litigation firm in Irvine, represents shippers and receivers in these disputes.
Call (909) 235-6116 or contact us online to discuss a freight claim that was denied or underpaid.
What the Carmack Amendment covers
The statute applies to motor carriers and freight forwarders that move property in interstate commerce. Federal jurisdiction reaches a shipment between a place in one state and a place in another, and the United States portion of a cross-border move. (49 U.S.C. § 13501.) A carrier must issue a receipt or bill of lading for the property it receives. That carrier, and any carrier that delivers the property, is liable to the person entitled to recover under the bill of lading for the actual loss or injury. It does not matter which carrier on the route caused the damage. (49 U.S.C. § 14706(a)(1).)
The Ninth Circuit has held that the Carmack Amendment is the exclusive cause of action for contract claims alleging delay, loss, failure to deliver, or damage to property shipped interstate. (Hall v. North American Van Lines, Inc. (9th Cir. 2007) 476 F.3d 683, 688.) A complaint that pleads ordinary breach of contract against the carrier is treated as a federal claim. A load that moves only within California, and is not part of a longer interstate move, is generally outside the statute.
Why the carrier offered so little
A small offer on a large loss may trace to a released value. A carrier may set rates under which its liability is limited to a value established by the shipper's written or electronic declaration, or by written agreement with the shipper. The value must be reasonable under the circumstances. (49 U.S.C. § 14706(c)(1)(A).) The limit may appear as a dollar figure or as cents per pound in the bill of lading or the rate confirmation.
In the Ninth Circuit, a carrier must give the shipper a reasonable opportunity to choose between two or more levels of liability and obtain the shipper's agreement to the level chosen. The bill of lading must reflect that choice before the shipment moves, and the carrier has the burden of proof. (OneBeacon Insurance v. Haas Industries, Inc. (9th Cir. 2011) 634 F.3d 1092, 1099-1101.) The court upheld a limit there because the signed bill of lading stated it and explained how to declare a higher value for an added charge. A carrier that does not file its tariff with the federal board must also give the shipper, on request, a copy of the rates and rules behind the shipment's price. (49 U.S.C. § 14706(c)(1)(B).)
A carrier and a shipper may also expressly waive, in writing, rights and remedies under this part of the federal code, so read any transportation contract first. (49 U.S.C. § 14101(b)(1).) Our page on limitation of liability clauses covers caps in other commercial contracts.
The claim deadlines and what counts as a claim
A carrier may not provide a period of less than nine months for filing a claim or less than two years for bringing a civil action. The two years are computed from the date the carrier gives written notice that it has disallowed any part of the claim. (49 U.S.C. § 14706(e)(1).) Those are floors, and the paperwork sets the actual period.
A notation on the delivery receipt is not a claim. Under the federal regulations, a written communication filed with a proper carrier is sufficient when it identifies the shipment, asserts liability for the loss, and demands a specified or determinable amount. (49 C.F.R. § 370.3(b).) Damage notations and inspection reports do not qualify standing alone. (49 C.F.R. § 370.3(c).) The carrier must acknowledge a proper claim in writing within 30 days of receipt, unless it has paid or declined it by then. (49 C.F.R. § 370.5(a).) It must pay, decline, or make a firm compromise offer in writing within 120 days of receipt. If it cannot, it must report the status and the reason at 120 days and every 60 days after. (49 C.F.R. § 370.9(a).)
An offer of compromise is not a disallowance unless the carrier says in writing that part of the claim is disallowed and gives its reasons. (49 U.S.C. § 14706(e)(2)(A).)
Carrier, broker, or freight forwarder
Liability under the statute attaches to carriers and freight forwarders. A broker is defined separately, as a person other than a motor carrier that sells or arranges transportation by motor carrier for compensation. (49 U.S.C. § 13102(2).) A company that only arranged the load is not the Carmack defendant. A claim against it rests on the broker agreement and other law. A separate federal statute preempts state law related to a broker's services, and federal trial courts in California disagree on whether a negligence claim over stolen cargo survives it. (49 U.S.C. § 14501(c)(1).)
The labels on the paperwork do not always settle which role a company played. We sort that out from the rate confirmation, the bill of lading, and each company's federal registration before a demand goes out.
Who holds the claim: the seller or the buyer
The carrier answers to the person entitled to recover under the bill of lading. Between a seller and a buyer, the delivery and risk of loss terms of the sale contract usually decide who absorbs the loss, as our page on sale of goods disputes explains. A buyer should also protect its position against the seller. Our page on rejecting nonconforming goods covers that step.
What to do now, and what to avoid
- Note the damage on the delivery receipt, photograph the freight and packaging, and keep both until the carrier can inspect.
- Send a written claim to the carrier, not only to the broker, within the bill of lading period.
- Do not deposit a check marked as full and final payment before getting advice. Our page on accord and satisfaction explains the risk.
A Carmack action may be filed in federal district court or in state court. (49 U.S.C. § 14706(d)(3).) A federal filing requires more than $10,000 in controversy for each bill of lading, and removal requires more than $10,000. (28 U.S.C. §§ 1337(a), 1445(b).) A carrier sued in a California superior court on a larger claim may ask to move the case, and our page on removal to federal court explains that step.
What to bring to the first meeting
Bring the bill of lading, the rate confirmation or transportation contract, and the delivery receipt with any notations. Add photographs, the commercial invoice showing the value of the goods, your written claim, and the carrier's response. Include every email with the carrier, the broker, and any insurer. If a check has arrived, bring it uncashed.
Frequently asked questions
A trucking company destroyed our $40,000 shipment and offered $500. Do we have to accept that offer?
No. For an interstate shipment, federal law makes a motor carrier liable for the actual loss, subject to a valid released-value limit and a few defenses the carrier must prove. In the Ninth Circuit, which includes California, the carrier must prove the shipper had a fair chance to choose a higher level of liability. Request the rate documents and file a written claim on time.
What is the Carmack Amendment?
It is the federal statute, now at 49 U.S.C. § 14706, that governs a motor carrier's liability for property lost or damaged in interstate commerce. It holds the receiving and delivering carriers liable for actual loss and sets minimum claim and suit periods. For a California business, it usually replaces state contract claims against the carrier.
How long do I have to file a freight damage claim?
The bill of lading or contract sets the period. Federal law bars a carrier from setting it below nine months for a claim or below two years for a lawsuit. The two years run from written notice disallowing any part of the claim. A California shipper should calendar the dates from its own paperwork.
The bill of lading limits the carrier to a few cents per pound and we never discussed it. Is that limit enforceable?
It can be. Federal law permits a limit based on the shipper's declaration or a written agreement if the value is reasonable. Ninth Circuit law, which federal courts in California follow, puts the burden on the carrier to show a reasonable opportunity to choose between liability levels. That court has enforced a limit where the signed bill of lading stated it and explained how to declare a higher value.
Can I sue a freight broker under the Carmack Amendment?
Generally not. The statute reaches carriers and freight forwarders, and federal law defines a broker as someone other than a motor carrier who arranges transportation for compensation. A California business with a claim against a pure broker looks to the broker agreement and other law.
Talk to a California business litigation attorney about a freight claim
If a carrier has denied or underpaid a claim for lost or damaged freight, call (909) 235-6116 or contact us online. Kolmogorov Law, P.C. is located in Irvine, California. Related reading: our breach of contract practice and our page on sale of goods disputes.
This page provides general information about California and federal law and is not legal advice. Outcomes depend on the bill of lading, the facts, and the court.