ALERT FOR ALL FREIGHT BROKERS
Today, the US Supreme Court ruled unanimously in the case titled MONTGOMERY v. CARIBE TRANSPORT II, LLC, 124 F. 4th 1053, that freight brokers can be sued in any state court for negligence in an accident involving a carrier the broker chose. What does this decision mean?
The freight brokerage industry’s federal preemption defense is over.
This ruling clarifies that freight brokers can be sued in state courts, potentially leading to higher liability, increased insurance costs, and higher freight rates.
Brokers will have to be more careful in choosing a carrier, meaning looking at their safety record and operational data.
Brokers will need to obtain insurance for catastrophic negligent hiring.
Brokers will have to be able to show they have a documented, data-driven carrier selection process in place.
If you would like to discuss or receive more information on this content, please contact us. The attorneys at Boodell & Domanskis are available to answer your questions about any general issues concerning your business.
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