Surface Transportation

COMMENTARY

By Matthew Leffler

Eric Michael Clarke

The question is whether this“ safety exception” extends to freight brokers.

The case of Montgomery v Caribe Transport II, LLC holds significant implications for the transportation and logistics industry, particularly for large shippers and manufacturers. The US Supreme Court on Oct. 3 granted certiorari— meaning it has agreed to hear the case— for the first time on the issue of broker liability.

This legal dispute centers on the Federal Aviation Administration Authorization Act( FAAAA), a law designed to streamline trucking regulations across state lines. A key issue has emerged regarding the interpretation of the FAAAA’ s safety exception, creating uncertainty that could disrupt the supply chain.

In 2018, Shawn Montgomery was stopped on the side of the road in Illinois in his tractortrailer, when Yosniel Varela-Mojena, driving a tractor-trailer for the motor carrier Caribe Transport II, LLC, veered off the roadway and collided with Montgomery’ s vehicle, causing severe injuries. The shipment was arranged by C. H. Robinson, which had hired Caribe to handle the transport.

Montgomery sued Varela-Mojena, Caribe, and Robinson alleging negligent hiring of the carrier and driver, as well as vicarious liability for their actions under state tort law. The district court granted summary judgment to Robinson on these claims and the 7th Circuit affirmed in January 2025, citing FAAAA.

FAAAA was enacted to preempt a patchwork of state laws and ensure a uniform regulatory framework for interstate trucking. However, a disagreement has arisen over the“ safety exception,” which allows states to regulate motor vehicle safety. The question is whether this exception extends to freight brokers, intermediaries who arrange transportation but do not operate vehicles.

The 6th and 9th Circuits have ruled that state tort claims, such as negligent hiring of motor carriers, can proceed against brokers. In contrast, the 7th and 11th Circuits have determined that such claims are preempted.

Large shippers depend on brokers to connect their goods to the trucking network. If brokers face varying liabilities depending on the location of a truck accident, it can potentially lead to increased costs or service disruptions for those companies.

And with over 95 % of motor carriers operating 10 trucks or fewer, those relying on brokers may face challenges. To mitigate the challenges posed by liability, brokers would likely need to make significant changes.

For example, brokers may increase their fees to cover the added risk and potential legal costs, which would raise transportation expenses for shippers who rely on them to move billions of tons of freight annually, potentially impacting profit margins. Brokers might also become more cautious, preferring to work only with well-established carriers, reducing competition and limiting the pool of available truckers, which could lead to delays in delivery schedules critical for manufacturers and retailers.

Finally, the uncertainty and potential for lawsuits could discourage smaller brokers from operating, shrinking the network of intermediaries and forcing shippers to seek alternative, possibly less efficient, logistics solutions.

In an amicus brief a similar suit, Total Quality Logistics, LLC v. Robert Cox, the US Chamber of Commerce and National Retail Federation argued that freight brokers should not be held liable for tort claims related to the safety of motor carriers they hire. They argued that existing federal and state regulations, not lawsuits against brokers, keep the nation’ s roads safe.

The Chamber pointed out that brokers lack reliable tools to properly screen carriers. The Chamber also warned that allowing these lawsuits could disrupt the transportation of goods, raise prices and hurt manufacturers, retailers and consumers, urging the Supreme Court to resolve the issue to protect the economy.

With a lack of uniformity threatening FAAAA’ s original goal of fostering a stable, competitive trucking industry, it is little surprise that the US Supreme Court would grant certiorari. As emphasized by the Transportation Intermediaries Association as well as the Chamber, without a clear ruling, brokers, shippers and manufacturers will face ongoing uncertainty, potentially weakening the national economy.

Looking ahead, this might be the most conservative Supreme Court in 100 years. Perhaps tellingly, this Supreme Court granted certiorari in Montgomery, where the broker won, and not Cox, where the broker lost.

Does this bode well for brokers? Time will tell. But despite ever-increasing liability, trucking remains the dominant mode of freight transportation in the US. Measured by weight, trucks transport 72.6 % of the country’ s freight.

The future of brokerage is at stake, and for now, all eyes look to the Supreme Court.

Matthew Leffler is a trucking industry expert and an adjunct professor of law at Michigan State University College of Law.

email: matthew @ armchairattorney. com

44 Journal of Commerce | November 3, 2025 www. joc. com