On May 14, 2026, the U.S. Supreme Court issued a unanimous decision in Montgomery v. Caribe Transport II, LLC, No. 24-1238, holding that negligent-hiring claims against freight brokers are not preempted by the Federal Aviation Administration Authorization Act (FAAAA). The Court concluded that such claims fall within the FAAAA’s safety exception, which preserves a state’s authority to regulate safety with respect to motor vehicles.
The decision resolves a longstanding split among federal courts and significantly expands potential liability for freight brokers and transportation brokers. Going forward, brokers may face increased exposure to state-law negligence claims arising from their carrier-selection decisions.
FAAAA Preemption and the Freight Broker Safety Exception
Freight brokers play a critical role in the U.S. supply chain, arranging freight shipments between shippers and motor carriers. Congress enacted the FAAAA in 1994 to deregulate certain economic aspects of the trucking industry and included a broad preemption provision prohibiting states from enforcing laws related to a broker’s or motor carrier’s prices, routes, or services.
Congress also included an important limitation on that preemption. The FAAAA’s safety exception provides that the statute does not restrict a state’s safety regulatory authority with respect to motor vehicles.
For years, courts disagreed on whether negligent-hiring claims against freight brokers fell within that exception. The Supreme Court’s decision in Montgomery answers that question and establishes that states may allow plaintiffs to pursue negligent-hiring claims against brokers when injuries allegedly result from the selection of an unsafe motor carrier.
Facts Behind the Supreme Court’s Freight Broker Liability Decision
Plaintiff Shawn Montgomery suffered severe injuries when a truck hauling freight struck his tractor-trailer. The shipment had been arranged by freight broker C.H. Robinson Worldwide, Inc.
Montgomery alleged that C.H. Robinson negligently selected the motor carrier despite the carrier receiving a “conditional” safety rating from the Federal Motor Carrier Safety Administration (FMCSA). According to the complaint, the carrier had documented safety deficiencies involving driver qualifications, hours-of-service compliance, vehicle maintenance, inspections, and crash history.
Montgomery argued that the broker knew or should have known that selecting the carrier created an unreasonable risk of harm to the public.
The district court dismissed the negligent-hiring claim, finding it preempted by the FAAAA, and the U.S. Court of Appeals for the Seventh Circuit affirmed. The Supreme Court reversed.
Supreme Court Rules Freight Brokers Can Be Sued for Negligent Hiring
The Supreme Court unanimously held that negligent-hiring claims against freight brokers fall within the FAAAA’s safety exception and therefore are not preempted.
The Court reasoned that state-law claims requiring brokers to exercise reasonable care when selecting motor carriers directly relate to motor vehicle safety. As a result, those claims constitute an exercise of a state’s safety regulatory authority and may proceed under state law despite the FAAAA’s general preemption provisions.
The decision answers a question that has divided federal courts for years: whether freight brokers can be held liable under state law for negligently selecting unsafe motor carriers. The Court concluded that they can.
Increased Freight Broker Liability and Litigation Risk
The Montgomery decision removes a significant defense that freight brokers have relied upon to obtain early dismissal of negligent-hiring claims.
As a result, brokers should expect an increase in trucking accident litigation naming both motor carriers and freight brokers as defendants. Plaintiffs’ attorneys may seek to expand theories of liability by challenging the adequacy of carrier-selection procedures, safety reviews, and other due diligence efforts.
The ruling may also prompt litigation over whether brokers have ongoing responsibilities to monitor carriers after initial approval and onboarding.
Carrier Selection Practices Will Receive Greater Scrutiny
Because negligent-hiring claims can now proceed under state law, a broker’s carrier-selection and onboarding practices may become central issues in future litigation.
Transportation brokers should consider reviewing and strengthening procedures related to:
- FMCSA safety ratings and safety records
- Carrier operating authority and regulatory compliance
- Insurance verification
- Crash history and out-of-service rates
- Driver qualification information
- Documentation of carrier-selection decisions
Maintaining thorough records of carrier evaluations, safety reviews, and onboarding decisions may become increasingly important when defending against negligent-hiring claims.
Notably, the concurrence suggested that brokers who maintain reasonable carrier-selection policies and conduct meaningful due diligence before tendering loads may be better positioned to defend against negligence allegations.
How Transportation Brokers Should Respond to the Montgomery Decision
The Supreme Court’s decision significantly changes the legal landscape for freight brokers and transportation brokers. The ruling increases potential exposure to negligent-hiring claims and underscores the importance of robust carrier-selection and risk-management practices.
Transportation brokers should evaluate their onboarding procedures, documentation protocols, carrier-vetting standards, and safety review processes to assess potential liability in light of the Court’s decision. Strengthening due diligence procedures and maintaining detailed records may help reduce risk and improve defensibility in future litigation.
For guidance regarding freight broker liability, FAAAA preemption, negligent-hiring claims, transportation broker litigation, or the impact of the Montgomery decision on your operations, contact a member of Varnum’s Litigation Practice Team.
