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Supreme Court Rules Freight Brokers Can Be Sued Under State Law for Negligent Hiring

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Supreme Court Allows Negligence Lawsuit Against Freight Broker to Proceed

The U.S. Supreme Court ruled unanimously on Thursday that Shawn Montgomery can pursue a state-law negligence lawsuit against freight broker C.H. Robinson for injuries sustained in a 2017 truck crash. The decision establishes that federal law does not preempt such claims, specifically regarding motor vehicle safety, and allows the case to proceed in state court.

Case Background

In 2017, Montgomery was stopped on an Illinois highway when his parked vehicle was struck by a speeding truck driver. The collision resulted in Montgomery losing part of his leg.

Montgomery alleges that C.H. Robinson, the largest freight broker in the United States, is liable for the crash because it hired the motor carrier despite knowledge of the carrier's poor safety record. According to Montgomery's legal team, the truck driver had been cited for careless driving in a prior crash, and the carrier had been involved in at least three crashes within a five-month period.

Legal Dispute and Lower Court Ruling

The case centered on whether federal law preempts state-law negligence claims against freight brokers. C.H. Robinson argued that as a federally regulated entity, it should not be subject to a "patchwork" of state laws.

A federal district court dismissed the case, and the Seventh Circuit Court of Appeals upheld that decision. Montgomery appealed to the Supreme Court.

Supreme Court Decision

Justice Amy Coney Barrett wrote the unanimous opinion, holding that a federal transportation law exemption protecting brokers does not apply when the claim involves motor vehicle safety. The Court ruled that negligent hiring claims fall under that safety exception.

The decision does not determine the outcome of the lawsuit; it only permits the case to proceed.

Concurring Opinion

Justice Brett Kavanaugh, joined by Justice Samuel Alito, noted that the ruling could increase insurance costs for brokers, potentially raising consumer prices, but stated that "truck safety is a matter of life and death."

Industry and Legal Context

Over 28,000 federally licensed brokers operate in the United States with minimal federal safety oversight regarding carrier selection. The Transportation Department has recently increased enforcement against unqualified drivers and trucking companies.

A CBS News investigation reported that thousands of trucking companies have evaded federal oversight by reincorporating under new names, known as "chameleon carriers." The analysis of Department of Transportation records found at least 10,000 such carriers approved since 2021, which are four times more likely to be involved in severe crashes than non-reincarnated companies. Over the last five years, at least 141 people have died and 1,800 have been injured in crashes involving these operators.

As an example, the 2022 Christmas Eve crash in Ohio that killed four members of a family involved a truck operated by BLF Truck Transportation, which had previously operated under three other names flagged for safety concerns. In a statement, C.H. Robinson said BLF Truck Transportation "deceived C.H. Robinson by double brokering a load" and called the operator's credibility into question.

Reactions

Parties Supporting Montgomery:

  • Over two dozen U.S. states supported Montgomery's position, arguing the case could improve safety.
  • Michael Leizerman, Montgomery's attorney, stated the ruling could pressure brokers to eliminate dangerous drivers.

Parties Supporting C.H. Robinson:

  • The Trump administration and companies including Amazon opposed the lawsuit, warning of inconsistent state laws.
  • Chris Burroughs, president of the Transportation Intermediaries Association, expressed disappointment, comparing the decision to holding travel agents liable for airline safety.
  • Dorothy Capers, chief legal officer of C.H. Robinson, stated the company was "disappointed but will continue working with policymakers and industry stakeholders to strengthen safety."

Broader Impact

Brian Watt, a freight logistics company owner, stated that brokers will now need to focus more on carriers' safety records rather than primarily on cost and speed.

C.H. Robinson is based in Eden Prairie, Minnesota.