On May 14, 2026, the United States Supreme Court issued a unanimous decision in Montgomery v. Caribe Transport II, LLC that fundamentally reshapes the liability landscape for freight brokers operating across the country. In an opinion authored by Justice Barrett, the Court held that state-law negligent-hiring claims brought against freight brokers are not preempted by the Federal Aviation Administration Authorization Act (FAAAA). The ruling resolves a long-standing circuit split that had created significant uncertainty for transportation and logistics companies regarding their exposure to claims arising from carrier selection decisions.
At the heart of the decision is the FAAAA's safety exception, which preserves state regulatory authority over motor vehicles. The Court concluded that negligent-hiring claims against brokers fall squarely within this exception because they are directly tied to the safe operation of motor vehicles on public roads. By bringing such claims within the safety exception, the Court has effectively cleared a path for plaintiffs injured in motor carrier accidents to pursue brokers under state tort law, in addition to pursuing the carriers themselves.
The practical consequences for the brokerage industry are substantial. Freight brokers nationwide now face direct exposure to negligent-hiring liability when they engage motor carriers that later cause harm. Companies that previously relied on FAAAA preemption as a defense will need to reassess their risk posture. Rigorous carrier-vetting policies should be reviewed and, where necessary, strengthened to include verification of operating authority, safety ratings, insurance coverage, and crash and inspection histories. Documented due diligence at the time of carrier selection will be critical evidence in defending against future claims.
Brokers should also revisit their contractual frameworks. Indemnity provisions, insurance requirements, and minimum coverage thresholds in carrier agreements warrant fresh scrutiny in light of the heightened liability exposure. Coordinating with insurance brokers to confirm that existing policies adequately respond to negligent-hiring allegations is an immediate priority. Internal training for procurement and dispatch personnel can further help ensure that vetting protocols are consistently applied and properly documented.
This article is provided for general informational purposes only and does not constitute legal advice. Clients with questions about how the Montgomery decision may affect their operations should consult qualified counsel for tailored guidance.