The Supreme Court of the United States handed down its decision in Montgomery v. Caribe Transport II, LLC, this morning. It was unanimous. Nine to zero. Justice Amy Coney Barrett wrote the opinion. Justice Brett Kavanaugh filed a concurrence, joined by Justice Samuel Alito, saying the case was closer than the majority opinion suggested, but agreeing with the result.
A negligent-hiring claim against a freight broker is not preempted by the Federal Aviation Administration Authorization Act. The FAAAA’s safety exception, 49 U.S.C. Section 14501(c)(2)(A), saves it. States retain authority to regulate safety “with respect to motor vehicles,” and require a broker to exercise ordinary care when selecting a carrier that concerns motor vehicles. That is the whole thing. Eight pages. No dissent.
The Seventh Circuit is reversed. The case goes back for proceedings consistent with the opinion. Shawn Montgomery, the driver who lost his leg when Yosniel Varela-Mojena veered off course in a Mack Truck hauling plastic pots through Illinois, can now pursue his negligent-hiring claim against C.H. Robinson.
The freight brokerage industry’s federal preemption defense is over.
Barrett’s opinion is remarkably short for a case this consequential. The analytical framework fits on a napkin. The FAAAA preempts state laws “related to a price, route, or service” of a motor carrier or broker “with respect to the transportation of property.” Section 14501(c)(1). But the safety exception preserves “the safety regulatory authority of a State with respect to motor vehicles.” Section 14501(c)(2)(A).
The court asked one question. Is a negligent-hiring claim against a broker a claim “with respect to motor vehicles”? The FAAAA does not define “with respect to.” The court relied on dictionary definitions and its prior construction in Dan’s City Used Cars, Inc. v. Pelkey (2013), where it said the phrase means “concerns.” The FAAAA defines “motor vehicle” as a vehicle propelled by mechanical power and used on a highway in transportation. Section 13102(16).
Put it together. A claim is “with respect to motor vehicles” if it concerns the vehicles used in transportation. Requiring C.H. Robinson to exercise ordinary care in selecting a carrier concerns motor vehicles. Most obviously, Barrett wrote, the trucks that will transport the goods.
The three counterarguments C.H. Robinson raised all failed.
C.H. Robinson argued that reading the safety exception this way would swallow the preemption clause whole. Barrett said no. The safety exception saves only claims involving motor vehicle safety. State laws related to prices, routes, and services that have nothing to do with safety remain preempted. The clause still does work. It just does not protect brokers from accountability when their carrier selection puts dangerous trucks on the road.
C.H. Robinson argued that Montgomery’s reading creates surplusage. Barrett said the surplusage exists regardless of how you define “with respect to motor vehicles” because the overlap comes from the word “safety,” not from the breadth of the phrase.
C.H. Robinson pointed to subsection (b) of the FAAAA, which preempts state regulation of intrastate broker activities and contains no safety exception. The argument was that Congress must have intended brokers to be fully shielded from safety claims; why leave the safety exception out of subsection (b)? Barrett acknowledged that it is “not obvious” why Congress included a safety exception in subsection (c) but not in subsection (b). Then she wrote the line that will be quoted in every brief filed in this area for the next decade: “Better to live with the mystery than to rewrite the statute.”
Barrett wrote the holding. Kavanaugh wrote the roadmap for what comes next.
Kavanaugh, joined by Alito, said this case was closer than the majority opinion suggested. He walked through the contextual considerations on both sides, and his analysis is the most honest accounting of the competing interests that any federal judge has put on paper in this area.
In favor of the brokers, Kavanaugh noted two things. First, the FAAAA mandates minimum insurance coverage for trucking companies but not for brokers. Section 13906(a)(1) versus (b)(2)(A). That gap suggests Congress did not anticipate tort suits against brokers for carrier selection. If it had, it presumably would have mandated insurance for them too. Second, the subsection (b) anomaly. Everyone agrees that the FAAAA preempts state tort suits against brokers for arranging intrastate transportation. Montgomery’s reading means state tort suits are permitted for interstate transportation but are preempted for intrastate transportation. That is, as Kavanaugh wrote, “exactly backward” from what ordinary preemption doctrine rooted in federalism would predict. Then Kavanaugh laid out why those points do not carry the day.
The FAA Authorization Act was an economic deregulation statute. It was not a safety deregulation statute. Congress left state tort suits against trucking companies fully intact. It is hard to read the statute as written and conclude that Congress “subtly sliced and diced state tort law” so that trucking companies face liability for accidents but brokers get complete immunity from the consequences of selecting the carrier that caused the accident.
Then the killer paragraph. There is no meaningful federal safety regulation of brokers’ carrier selection practices. FMCSA requires brokers to select a federally registered carrier but does not otherwise impose safety standards on broker hiring decisions. If Congress preempted state tort law and simultaneously failed to impose any federal safety requirements on broker selection, brokers would operate in a “black hole with no meaningful safety-related regulation.” Kavanaugh was not willing to read that result into “such indirect language in an economic-deregulation statute.”
He closed with this: truck safety is a matter of life and death. In 2022, approximately 500,000 reported truck accidents resulted in about 5,000 deaths and 114,000 injuries. Not all can be prevented. But some can. Some carriers are known to be less safe. Some truck drivers are known to be unfit.
If brokers can be held liable for disregarding poor safety records, Kavanaugh wrote, “they have a strong incentive to do business only with safe and reliable motor carriers.”
This opinion does not say that every broker who touches a load that ends in a crash is liable. Kavanaugh went out of his way to make that point. The plaintiff’s own counsel told the justices at oral argument that brokers should be able to successfully defend against tort suits if they have acted reasonably and arranged transportation with reputable carriers. The broker, counsel said, “is not going to have a problem if it’s asking the hard questions of the carrier.”
The operative word is “asking.”
The legal standard is ordinary care. The question a jury will now be permitted to ask in every state in America is whether the broker exercised reasonable care in selecting the carrier. That means: Did you check the carrier’s safety record? Was the carrier’s FMCSA data available to you? Did the data show elevated crash rates, conditional safety ratings, high out-of-service percentages, or prior enforcement history? Did you have a documented process for evaluating carrier safety? Or did you book the cheapest truck and move on?
If you are a freight broker operating in the United States today, the preemption defense you have been relying on since 2023, when the Seventh Circuit decided Ye v. GlobalTranz, is gone. You are now subject to state tort law in every jurisdiction where you arrange transportation. The carrier you select, the safety record you ignore, the data you decline to check, all of it is discoverable. All of it is admissible. All of it can be presented to a jury.
This decision removes the federal shield that was blocking an old theory. Negligent hiring is a tort theory that has existed for generations. The Restatement (Second) of Torts, Section 411, imposes a duty of reasonable care in employing a contractor for work carrying a risk of physical harm. Barrett cited it in the opinion.
Plaintiff’s attorneys who handle commercial motor vehicle crash cases have been building these case files for years, waiting for the preemption question to resolve. The dockets are ready. The carrier safety data is public. FMCSA’s SAFER system is free. A broker’s carrier selection history is discoverable in litigation. The inspection records showing which carriers a broker habitually dispatched, and what those carriers’ safety profiles looked like at the time of dispatch, are all federal records.
The first wave of post-Montgomery negligent-hiring suits against brokers will be filed within the next few weeks. They will name brokers who selected carriers with known safety deficiencies, conditional ratings, elevated BASIC percentile scores, prior out-of-service orders, and authority less than 18 months old. The discovery requests will seek the broker’s carrier vetting policies, internal screening criteria, communications with the carrier prior to dispatch, and any safety data the broker reviewed or failed to review.
If a broker has no documented carrier vetting process, that absence is itself evidence.
Kavanaugh flagged this in his concurrence, and it deserves its own discussion. The FAAAA mandates minimum insurance coverage for motor carriers. It does not mandate comparable coverage for brokers. The existing broker surety bond requirement under 49 U.S.C. Section 13906 is $75,000. That is not liability insurance. That is a financial responsibility bond intended to ensure payment to carriers and shippers. It does not cover tort claims.
Most freight brokers carry some form of general liability and contingent cargo coverage. Very few carry the kind of excess liability coverage that would respond to a catastrophic negligent-hiring verdict. The nuclear verdict environment in trucking litigation has produced eight-figure and nine-figure outcomes against motor carriers. Those same jury dynamics now apply to brokers.
The insurance industry has not yet priced this exposure. When it does, freight broker premiums will adjust. The adjustment will be significant for brokers who cannot demonstrate a documented, data-driven carrier selection process. The adjustment will be less severe for brokers who can show that their vetting methodology is systematic, repeatable, and grounded in publicly available safety data.
The carriers a broker habitually selects, their safety profiles, their authority ages, their crash histories, their inspection outcomes, all of that is now part of the risk profile that an underwriter will evaluate.
This is not complicated. The court did not rewrite the rules of physics. It removed a procedural shield. The underlying obligation to exercise reasonable care in selecting a carrier is the same standard every other industry participant already operates under. Shippers exercise care in selecting carriers. Carriers exercise care in hiring drivers. Brokers are now held to the same standard.
Document your carrier selection process. If you do not have one, build one. If you have one that checks whether the carrier has active authority and a pulse, that won’t hold up.
Check the safety data. FMCSA’s SAFER system, SMS BASIC percentile scores, crash rates, out-of-service rates, and inspection history are all public and free. If a carrier’s data shows elevated risk and you book them anyway, a plaintiff’s attorney will ask you why. Have an answer.
Keep records. The vetting you did, the data you reviewed, the criteria you applied, the decision you made. Timestamp it. Store it. When the subpoena arrives three years from now asking what you knew about the carrier you dispatched on the load that ended in a fatality, you want a file, not a shrug.
Talk to your insurance broker. Today. Ask whether your current coverage responds to a negligent-hiring tort claim. Ask what your exposure looks like under the post-Montgomery landscape. If you are an insurance broker who writes freight broker accounts, you should already be drafting the coverage review letter.
Montgomery v. Caribe Transport is not just a broker case. Kavanaugh acknowledged this implicitly when he discussed 3PLs, freight forwarders, and digital freight platforms that make carrier selection decisions. The opinion is written about brokers because C.H. Robinson is a broker. But the logic applies to anyone in the supply chain who selects a carrier and has access to publicly available safety data showing that the carrier presents an elevated risk.
The court said that requiring a party to exercise ordinary care in selecting a carrier concerns motor vehicles. That is a principle. It does not stop at licensed broker authority holders.
Shippers who select carriers directly are not preempted and never were. But shippers who relied on the assumption that their broker’s preemption defense would insulate the entire transaction from negligent-selection liability need to rethink that assumption. The broker can now be sued. The broker’s defense will include evidence of what the shipper knew, what the shipper required, and the shipper’s own carrier-selection criteria.
The liability does not disappear. It redistributes. It redistributes to the parties who had the data and could have made a different decision but chose not to.
The Supreme Court told the freight industry something today that it should have already known. If you pick the carrier, you own the choice. Document it. Defend it. Or answer for it.
The post The Supreme Court just told every freight broker that they can be sued appeared first on FreightWaves.
