Supreme Court Says Broker Liability Case Can Proceed

(Rod Lamkey Jr./Associated Press)

WASHINGTON — The U.S. Supreme Court on May 14 said a man who was seriously injured when his parked tractor-trailer was hit by another semi can proceed with a lawsuit against the third-party logistics company that brokered the load. 

The high court ruled unanimously in favor of Shawn Montgomery, who lost part of his leg after a truck operated by Caribe Transport II hit his tractor-trailer on an Illinois highway in 2017. In addition to suing Caribe, he sued C.H. Robinson, which brokered the load. 

Montgomery’s attorneys said the Caribe truck driver had been cited for careless driving in another crash months earlier, and that the carrier he worked for had been involved with at least three crashes in a span of about five months. 

Montgomery argued that C.H. Robinson should share liability because it hired the carrier despite these issues. 

However, C.H. Robinson argued that it relies on the federal government to license carriers, and maintained that being federally regulated means it can’t be sued under state law being applied in this case.

That argument is central to the case. More than two dozen states backed Montgomery’s claim on grounds that allowing the suit to proceed would have long-term effects on improving highway safety. On the other side was the Trump administration and Amazon, which argued against exposing logistics companies to liability under a “patchwork” of state laws.

Eden Prairie, Minn.-based C.H. Robinson won a dismissal of the case in a ruling affirmed by a Chicago-based appeals court, which led to Montgomery’s appeal to the Supreme Court. He argued that while federal law usually supersedes state law, other courts have recognized an exception for safety issues. 

In an opinion authored by Justice Amy Coney Barrett, the justices agreed. In doing so, the high court overturned the lower-court ruling in C.H. Robinson’s favor.

“The Federal Aviation Administration Authorization Act preempts state laws related to the prices, routes and services of the trucking industry,” Barrett wrote. “But there is an important exception: States retain authority to regulate safety ‘with respect to motor vehicles.’ This case presents the question whether a claim that one company negligently hired another to transport goods falls within that exception. It does.”

C.H. Robinson chief legal officer Dorothy Capers in a statement provided to Transport Topics said, “Our hearts continue to go out to the victims of truck accidents. Safety is foundational to who we are — our employees and their families travel these same roads, and our business depends on safe freight delivery.” 

Capers said that while company leaders are disappointed in the decision, they will continue to operate responsibly, support stronger federal enforcement and work constructively with regulators, carriers and customers to strengthen the national safety system and support safe, reliable transportation across the country. 

In a statement, the Transportation Intermediaries Association called the decision “deeply disappointing.”

“This is like asking travel agents to evaluate the safety of a given airline despite the fact that the airline has been licensed to fly by the federal government,” said Chris Burroughs, the group’s president and CEO. “We are working with our members to assess potential next steps to mitigate the consequences of the Supreme Court’s decision.” 

Justice Brett Kavanaugh in a concurring statement joined by Justice Samuel Alito warned the decision could increase insurance costs for freight brokers. While Kavanaugh noted those costs could eventually “cascade through the economy” and result in higher prices for consumers, he also stressed that “truck safety is a matter of life and death.” 

C.H. Robinson pointed to another part of the concurrence that maintained that the decision should not be viewed as a turning point for increased litigation targeting brokers. 

“As Justices Kavanaugh and Alito stated in the concurrence, ‘The court’s decision today should not be read to mean that brokers will routinely be subject to state tort liability in the wake of truck accidents,’ ” Capers said.

She added, “We will keep working with policymakers, advocates, carriers, our customers and others across the industry to strengthen the national safety system and advance practices that reduce accidents on America’s roads.” 

Additional reporting by Staff Reporter Connor D. Wolf.