Supreme Court Permits State Negligent-Hiring Claims Against Freight Brokers Under FAAAA Safety Exception

Montgomery v. Caribe Transport II, LLC, 608 U.S. ___ (2026)

By Paul-Michael M. Dusek, Senior Associate – Texas

Clausen Miller P.C.  |  Houston, Texas  |  [email protected]  |  346.826.8926

On May 14th, the U.S. Supreme Court unanimously held that a negligent-hiring claim against a freight broker is not preempted by the Federal Aviation Administration Authorization Act (FAAAA). Under 49 U.S.C. Section 14501(c)(2)(A) states retain the authority to regulate safety “with respect to motor vehicles,” and states can require a broker to exercise ordinary care when selecting a carrier that concerns motor vehicles.

The Case in Brief

The Court focused on one question: Is a negligent-hiring claim against a broker a claim “with respect to motor vehicles”?

Petitioner Shawn Montgomery received severe injuries when his tractor trailer was struck by a Mack Truck filled with plastic pots driven by Yosniel Varela-Mojena for respondent Caribe Transport II, LLC. The shipment was coordinated by C.H. Robinson Worldwide. Montgomery sued all defendants in Federal Court alleging a variety of negligence claims including negligent hiring of Varela-Mojena and Caribe Transport by C.H. Robinson Worldwide. Montgomery alleged that C.H. Robinson either knew or should have known from Caribe’s safety rating that hiring the organization to transport goods was reasonably likely to result in crashes that would injure others. The District Court ruled that the FAAAA (which preempts state regulation of pricing, routes, and trucking industry services) expressly preempted the negligent hiring claim against C.H. Robinson. The District Court also held that the claim did not fall within the FAAAA safety exemption, which states that the FAAAA “shall not restrict the safety regulatory authority of a State with respect to motor vehicles.” Section 14501(c)(2)(A). The Seventh Circuit affirmed the District Court.

Montgomery claimed that C.H. Robinson was liable for his injuries because they negligently hired Varela-Mojena and Caribe Transport. At the time Caribe was hired by C. H. Robinson,  Caribe had a “conditional” safety rating and had found to be deficient regarding driver qualifications, hours of service for the drivers, inspection, repair and maintenance issues, their recordable crash rate, and more. Therefore, because of this safety rating, Montgomery argued that C. H. Robinson should have known that hiring Caribe would reasonably likely result in crashes that would injure others.

The Courts were split on whether a negligent hiring claim falls within the “with respect to motor vehicles” exemption under Section 14501(c)(2)(A). Using a plain language reading of “with respect to motor vehicles” the court reasoned that a claim is “with respect to motor vehicles” if it concerns the vehicles used in transportation. Therefore, the application of Montgomery’s claim is straightforward. C.H. Robinson hired a transport company that had a subpar safety rating, based on that subpar rating C.H. Robinson knew or should have known that using Caribe to transport goods was reasonably likely to cause an accident.

Key Holdings

A claim that one company negligently hired another to transport goods is not preempted by the FAAAA because States retain authority to regulate safety “with respect to motor vehicles” under the Act.

Simply put, a claim is “with respect to motor vehicles” if it concerns the vehicles used in transportation.

Why This Decision Matters

Brokers can be held liable for disregarding poor safety records, creating a strong incentive to do business only with safe and reliable motor carriers. Justice Kavanaugh’s concurrence noted that brokers should be able to successfully defend if they acted reasonably and arranged transportation with reputable trucking companies.

Justice Barrett wrote the holding. Justice Kavanaugh established the roadmap for what is coming down the road next. He pointed out that the FAAAA requires minimum insurance coverage for trucking companies but not for brokers. The broker security bond under 49 U.S.C. Section 12906 is only $75,000.00. Brokers should note that their financial surety bonds ($75,000) cover payment disputes, not tort judgments.

Few freight brokers carry excess liability coverage that would handle a catastrophic negligent-hiring verdict. Freight brokers can now be exposed to the same seven and eight figure jury verdicts faced by motor carriers.

The insurance industry has not yet grappled with the issues of this new exposure, but when it does freight brokerage premiums will adjust.  Brokers that can demonstrate a systematic, documented, data-driven selection process based on publicly available data will face a less severe increase in premiums than those brokerage firms that cannot demonstrate a certain level of continuous, rigorous and systematic investigation of their choice motor carriers.

Practical Takeaways for Freight Brokers

The freight brokerage industry’s federal preemption defense is over.

Freight brokerage firms will now face personal injury suits in all states for negligent hiring.

Freight brokerage firms will have to exercise ordinary care in selecting a freight carrier.

Brokers can now be held liable for disregarding poor safety records and this creates a strong incentive for freight brokers to only do business with safe and reliable motor carriers.

Now, injured Plaintiffs will be able to sue freight brokers for negligent hiring. Juries across the country will not be asked whether a broker exercised reasonable care in selecting the carrier.

The following are just some of the questions that freight brokers will have to answer before a jury:

• Did you check the carrier’s safety record?
• Was the carrier’s FMCSA data available to you?
• What did the FMCSA data show? Did the carrier have an unreasonable amount of crash rates, conditional safety ratings, high out of service percentages, or prior enforcement history?
• What is the broker’s documented process for evaluating carrier safety?
• With regard to investigating the motor carrier, what the broker did and more importantly what the broker did not do or what they choose to ignore during the investigation process can all be presented to a jury.

Brokers need to document their carrier selection process. If they do not have a process, build a process. At a minimum, check the following:

1. the carrier’s own safety data
2. the FMCSA’s SAFER systems (located at https://safer.fmcsa.dot.gov/)
3. crash rate
4. SMS BASIC percentile scores (located at https://ai.fmcsa.dot.gov/SMS/)
5. out-of-service rates
6. inspection history

Document your selection process in real time, including which data sources you consulted (FMCSA SAFER, SMS BASIC scores, crash rates), the safety metrics you considered, and the comparative analysis that led to your decision. Contemporaneous documentation is critical for defending negligent-hiring claims.

Talk to your insurance broker and determine whether your current coverage handles negligent-hiring tort claims.

Finally, if you have more questions reach out to one of the attorneys at Clausen Miller P.C.

About the Author

Paul-Michael M. Dusek is a Senior Associate of Clausen Miller P.C.’s Texas office in Houston. His practice focuses on insurance defense across Texas state and federal courts, including premises liability, products liability, commercial trucking, construction defect, and first party and third-party automobile liability.

Paul-Michael Dusek  |  Clausen Miller P.C.
16945 Northchase Dr., Suite 1400  |  Houston, TX 77060
346.826.8926  |  [email protected]

This client alert is for general informational purposes only and is not legal advice. The information may not apply to your particular situation and should not be acted on without specific legal advice based on the facts of your matter.