Supreme Court Says Freight Brokers Can Face Negligence Claims

The U.S. Supreme Court on May 14 ruled that federal law does not shield freight brokers from state-law negligence claims when they hire unsafe motor carriers, a decision that could expand liability exposure for companies that arrange trucking services.

In a unanimous decision in Montgomery v. Caribe Transport II, LLC, the court held that the Federal Aviation Administration Authorization Act’s (FAAAA) “safety exception” preserves states’ authority to allow lawsuits alleging that brokers negligently selected dangerous carriers. The ruling reverses a 7th Circuit decision that had barred such claims as preempted by federal law. 

Background of the Case

The case arose from a serious highway accident in Illinois. Plaintiff Shawn Montgomery was severely injured when his tractor-trailer, which was stopped on the shoulder, was struck by another truck operated by Caribe Transport II, LLC.

Montgomery sued multiple defendants, including C.H. Robinson Worldwide, one of the nation’s largest transportation brokers. He alleged that C.H. Robinson negligently hired Caribe Transport despite publicly available safety data indicating that the carrier posed an unreasonable risk.

C.H. Robinson argued that the FAAAA preempted the claim. The statute broadly bars states from enforcing laws “related to a price, route, or service of any motor carrier or broker.” According to the broker, allowing state negligence suits would interfere with how brokers perform their core service of selecting carriers.

Both the federal district court and the 7th Circuit agreed, concluding that Montgomery’s negligent-hiring claim was barred by federal law.

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The Legal Question

The Supreme Court considered whether the claim fell within the FAAAA’s safety exception, which states that the preemption provision “shall not restrict the safety regulatory authority of a State with respect to motor vehicles.”

If the exception applied, Montgomery’s lawsuit could proceed.

Supreme Court’s Decision

Writing for the court, Justice Amy Coney Barrett concluded that negligent-hiring claims against brokers are sufficiently connected to motor vehicle safety to fit within the statutory exception.

The court emphasized that such claims are designed to promote highway safety by encouraging brokers to avoid carriers with poor safety records.

As Barrett explained, brokers play a significant role in the transportation industry by acting as “matchmakers” between shippers and carriers. When they ignore warning signs and hire unsafe trucking companies, state tort law can serve as a traditional mechanism for protecting the public.

Because the claim concerns the safe operation of motor vehicles, the court held that it falls squarely within the safety exception and is not preempted.

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Key Reasoning

The court’s reasoning rested on several principles:

• State tort law is a longstanding safety tool. Negligence claims help deter unsafe practices and compensate injured parties.
• The case directly concerns truck safety. The lawsuit alleges that the broker’s hiring decision led to a dangerous truck being placed on the road.
• Congress sought economic deregulation, not safety deregulation. The FAAAA was designed to prevent states from regulating prices and routes, not to eliminate traditional personal injury claims.

Concurring Opinion

Justice Brett Kavanaugh, joined by Justice Samuel Alito, agreed with the result but noted that the case was a close one.

Kavanaugh acknowledged that the brokers raised substantial arguments, including that Congress did not require brokers to carry the same insurance as motor carriers. Nonetheless, he concluded that the overall structure of the statute and the central importance of safety supported allowing state negligence suits. 

Practical Impact

The decision is significant for the logistics industry. Transportation brokers may now face increased litigation risk when they fail to adequately vet carriers’ safety histories.

For injured plaintiffs, the ruling preserves an additional avenue for recovery, particularly in cases where the motor carrier lacks sufficient assets or insurance.

The case was remanded to the lower courts, where Montgomery’s negligence claim against C.H. Robinson will move forward.