Supreme Court Expands Exposure for Freight Brokers

On May 14, 2026, the U.S. Supreme Court in a unanimous decision answered the long-awaited question: Can freight brokers be held liable for accidents caused by the motor carriers they hire. The answer is a resounding YES.

THE LAW

The debate centers on the Federal Aviation Administration Authorization Act (FAAAA), enacted in 1994 to prevent states from enforcing laws that interfere with the prices, routes, or services of carriers and brokers in interstate commerce (49 U.S.C. § 14501). But the statute includes a short, much-litigated carve-out: it does not preempt “the safety regulatory authority of a State with respect to motor vehicles.”

The question that the courts had to decide was whether a claim that one company negligently hired another to transport goods falls within that exception.” That brief exception created a split with some courts finding that a broker’s role is a “service” Congress intended to shield from state interference and others viewing negligent-hiring claims against brokers as falling squarely within a state’s traditional safety authority.

THE SPLIT

The Ninth and Sixth Circuits – covering Alaska, Arizona, California, Hawaii, Idaho, Kentucky, Michigan, Montana, Nevada, Ohio, Oregon, Tennessee, and Washington - held that the safety exception permits negligent-hiring claims to go forward. See Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1030–31 (9th Cir. 2020); Cox v. Total Quality Logistics, Inc., 142 F.4th 847, 851 (6th Cir. 2025). The Seventh and Eleventh Circuits - covering Alabama, Florida, Georgia, Illinois, Indiana, and Wisconsin - held that the claims are preempted. See Ye v. GlobalTranz Enters., Inc., 74 F.4th 453, 464 (7th Cir. 2023); Aspen Am. Ins. Co. v. Landstar Ranger, Inc., 65 F.4th 1261, 1272 (11th Cir. 2023).

The result created an uneven legal landscape where a broker’s potential exposure depended on where a crash occurs.

That is, UNTIL NOW.

BACKGROUND

The case began with a catastrophic accident on an Illinois highway. Truck driver Shawn Montgomery was severely injured when his tractor-trailer was struck by a truck operated by a motor carrier (Caribe Transport II, LLC) that had been hired by a freight broker (C.H. Robinson) to carry goods. The truck veered off course striking Montgomery’s tractor-trailer, which was

stopped on the side of the road, severely injuring Montgomery. Montgomery alleged that the broker was liable for his injuries because it negligently hired an unsafe motor carrier and driver.

The motor carrier had a conditional safety rating from the Federal Motor Carrier Safety Administration, the federal trucking regulators, for being deficient with respect to its safety record, including qualification of drivers; hours of service of drivers; inspection, repair, and maintenance of vehicles; and recordable crash rate, among other deficiencies. Montgomery argued that the broker knew or should have known from the motor carrier’s safety rating that hiring it to transport goods was “reasonably likely to result in crashes that would injure others.”

The District Court and the Seventh Circuit following its precedent found that the broker was not liable. The Supreme Court disagreed and reversed by a unanimous decision.

RATIONALE

The purpose of the safety exception was “to ensure that [the FAAAA’s] preemption of States’ economic authority over motor carriers of property [did] ‘not restrict’ the preexisting and traditional state police power over safety.”

The Court explained that Negligent Hiring claims “impose a duty of reasonable care in employing a contractor for work carrying a risk of physical harm.” Therefore, the ultimate question was whether negligent hiring claims of the type that Montgomery asserted were “with respect to motor vehicles.” Since the statute provided no definition, the Court used the dictionary definition and interpreted “with respect to motor vehicles” to mean that the law must concern the actual vehicles used in transportation. The FAAAA defines a motor vehicle as “a vehicle, machine, tractor, trailer, or semitrailer propelled or drawn by mechanical power and used on a highway in transportation.”

Alleging that a freight broker failed to exercise ordinary care in selecting a carrier with a safe vehicle and qualified driver directly concern motor vehicle safety. Negligent hiring is tied to whether unsafe trucks or drivers were selected to operate on highways; therefore, it falls under the safety exception to preemption. As a result, even though the FAAAA normally preempts state-law claims related to brokers’ services, the safety exception “saves” negligent-hiring claims from preemption when they are about vehicle safety.

Simply put, C.H. Robinson (the broker) failed to exercise reasonable care by hiring Caribe Transport (the motor carrier) to transport goods by truck despite the carrier’s less-than- satisfactory safety rating from federal regulators.

Interestingly, the FAAAA does preempt state regulation of negligent hiring claims for brokers arranging intrastate transportation. While the Court agreed that it was a mystery as to why there is no safety exception for intrastate commerce but there is for interstate commerce, they concluded that it is “[b]etter to live with the mystery than to rewrite the statute.”

WHAT HAPPENS NOW?

As a procedural matter, the case will be sent back to the lower courts to decide the matter consistent with the Supreme Court’s opinion.

For freight brokers, they can be sued under state law negligent-hiring theories when they choose unsafe motor carriers whose vehicles cause injury or death. The decision subjects brokers to a patchwork of state standards governing broker liability.

Brokers can defend themselves against tort suits if they have acted reasonably and arranged transportation with reputable carriers. Juries will be asking if brokers exercised reasonable care in selecting the motor carriers that they hire.

While the FAAAA only requires minimum insurance coverage for motor carriers, it does not require comparable coverage for brokers. Brokers must ensure that the motor carriers they hire have adequate insurance to cover liability and that the brokers are named as additional insureds. Otherwise, they risk becoming the “deep pockets.” They also need to make sure that they have adequate insurance coverage; and expect premiums to increase as the insurers price this exposure into the premiums.

Brokers must maintain robust carrier-vetting procedures, documenting safety-rating and inspection-history reviews, and ensuring that contracts clearly define who bears responsibility for vehicle operation and regulatory compliance. Periodic re-screening and written safety protocols can further reduce exposure. Carrier selection is not a purely logistical decision; it is a safety decision.

The FMCSA’s free SAFER reports can be accessed online at https://safer.fmcsa.dot.gov/ CompanySnapshot.aspx.

For brokers — and freight forwarders, which are also affected by this decision — the hope is that their current practices already include this type of vetting process. It is also important to keep records of the vetting process, the data found, the criteria used, and the decision made. In the event of a future case, these records will become your answer, your protection.

Now, every participant in the transportation chain faces potential liability.

For reference, the specific case is Montgomery v. Caribe Transport II, LLC, 608 U.S. (2026)

If you have questions about this article or about broker liability in general, please contact Mitchell Goldstein (mgoldstein@setlifflaw.com) at (804) 377-1269 or Steve Setliff (ssetliff@setlifflaw.com) at (804) 377-1261.