Swansenreport

9-0: Supreme Court Rules Freight Brokers Can Be Sued for Hiring Unsafe Trucking Companies

The Supreme Court issued a unanimous decision this morning that could fundamentally reshape the trucking industry — ruling that freight brokers can be held liable under state negligence law when they knowingly hire unsafe carriers that go on to cause serious accidents.

The case, Montgomery v. Caribe Transport II, LLC, arose from a 2017 crash in Illinois in which Shawn Montgomery lost part of his leg after his parked vehicle was struck by a truck hauling a load of plastic pots. The trucker’s carrier, Caribe Transport, had a “conditional” safety rating — a documented red flag — when freight broker C.H. Robinson, the nation’s largest, dispatched the load. Montgomery sued C.H. Robinson, arguing the broker knew or should have known the carrier was unsafe. Fox Baltimore

Until today, brokers had a powerful defense: a federal law called the FAAAA had long been interpreted to preempt state negligence claims against brokers. Justice Amy Coney Barrett, writing for all nine justices, held that the FAAAA’s safety exception preserves states’ authority to regulate motor vehicle safety — and that a negligent-hiring claim against a broker falls squarely within that exception. The Seventh Circuit’s ruling in C.H. Robinson’s favor was reversed. Local 12

The practical implications are sweeping. Freight brokers now face real, discoverable, jury-decidable liability for their carrier selection decisions. The carrier safety data has always been publicly available — brokers could always check a carrier’s FMCSA safety rating before dispatching a load. Until today, doing so was optional. After today, skipping that check creates legal exposure. Yahoo!

Justice Kavanaugh, joined by Justice Alito, filed a concurrence agreeing with the result but cautioning against overreading the ruling. “Brokers should be able to successfully defend claims when they act reasonably,” Kavanaugh wrote, noting the decision does not mean brokers are automatically liable every time a carrier causes a crash. Yahoo!

Not everyone is celebrating. The National Federation of Independent Business — which had filed an amicus brief warning of the consequences — called the ruling a blow to supply chain clarity. “Without a uniform standard, every small business who uses a trucking company will be hit with higher costs and reduced availability as the resulting patchwork of state court decisions creates confusion,” said NFIB’s Beth Milito. The Trump administration and Amazon had also warned the Court against allowing the suit to proceed, arguing it could expose logistics companies to inconsistent liability across 50 states. MyNews4

The bottom line: if you broker freight and dispatch a carrier with known safety red flags, you can now be sued in state court when that carrier hurts someone. C.H. Robinson CEO Dave Bozeman had told investors just weeks ago he expected to win the case. The company’s chief legal officer issued a statement saying it was “disappointed” by the decision but pledged to work with regulators and carriers on safety. Local 12

Sources: Supreme Court Opinion — Cornell LII | Commercial Carrier Journal | FreightWaves | Logistics Management | NFIB Statement