Freight Broker Liability After Montgomery v. Caribe Transport II

Freight Broker Load Arrangements

A freight broker arranges for a motor carrier to haul a shipper’s freight and chooses which motor carrier gets the load. Federal law defines a broker as a person, other than a motor carrier, that sells, negotiates, or arranges motor carrier transportation for compensation. The broker does not drive the truck or own it. Its work is the choice of carrier.

Brokers find carriers through load boards and through their own lists of carriers that run the same routes. When a carrier accepts a load, the broker issues a rate confirmation that names the carrier, the pickup and delivery times, and the price. That document, the broker’s carrier agreement, and the messages around the load show what the broker knew and required.

Federal Registration for Freight Brokers

Brokers register with the Federal Motor Carrier Safety Administration for authority to arrange interstate loads. A broker must keep a $75,000 surety bond or trust fund in effect, filed on Form BMC-84 or BMC-85. That security pays claims arising from a broker’s failure to pay freight charges. It is not a fund for people injured in an accident.

Each broker must keep a record of every load it arranges for three years. The record shows the shipper’s name and address; the originating motor carrier’s name, address, and registration number; the bill of lading or freight bill number; what the broker was paid and by whom; and the freight charges it collected and the date it paid the carrier. Each party to the transaction has the right to review that record.

Carrier Vetting Records

A broker can run a motor carrier through vetting software before booking a load, and each check leaves a record of what the broker saw on the day it chose the carrier. The public side of that check comes from FMCSA: operating authority, insurance filings, inspection and accident history, and the carrier’s safety rating.

A safety rating follows an FMCSA compliance review. A Conditional rating means the carrier does not have adequate safety management controls in place to ensure compliance with the safety fitness standard. An Unsatisfactory rating means the same failure has already resulted in the occurrences the standard lists. Many carriers have no rating at all, because they have never had a compliance review.

In Montgomery, the plaintiff alleged that the carrier held a Conditional rating, with deficiencies in driver qualification, hours of service, and inspection, repair, and maintenance, when the broker hired it. A rating like that is in the public record on the day of booking. Whether the broker looked, and what it did with what it saw, is the center of a negligent selection claim.

Freight Broker Insurance Coverage

Motor carriers must carry federal minimum liability insurance. Brokers have no matching federal requirement: their only required financial security is the $75,000 bond, which protects carriers and shippers who go unpaid.

Brokers can buy contingent auto liability coverage. Insurers write it to protect a broker when one of its contracted truckers has a coverage issue. In a serious injury case, the broker’s contingent policy can be a separate layer of coverage beyond the motor carrier’s own policy, and the broker’s policies belong in the first written discovery.

Montgomery v. Caribe Transport II Decision

The case asked whether the Federal Aviation Administration Authorization Act of 1994 blocks state negligence lawsuits against freight brokers that select unsafe motor carriers, or whether those lawsuits fall within the statute’s safety exception, 49 U.S.C. § 14501(c)(2)(A).

Shawn Montgomery’s tractor-trailer was stopped on the side of an Illinois road when a truck driving for Caribe Transport II veered off course and struck it. C.H. Robinson had brokered the load. Montgomery’s leg had to be amputated, and he sued the broker for negligently hiring the carrier and its driver. The district court held the claim preempted, and the Seventh Circuit affirmed.

On May 14, 2026, the Supreme Court reversed without dissent in an opinion by Justice Barrett. A claim that one company negligently hired another to transport goods is not preempted. The Court read the safety exception’s phrase “with respect to motor vehicles” to cover a claim that concerns the vehicles used in transportation, and a duty to use ordinary care in choosing a carrier concerns the trucks that carry the goods. Justice Kavanaugh, joined by Justice Alito, concurred and called the case closer than the majority did.

The decision lets the claim go forward without deciding the merits. The case returned to the lower courts, where the plaintiff still has to prove that the broker failed to use reasonable care in choosing the carrier and that the failure caused the accident.

Records in a Freight Broker Case

In a truck accident case against a freight broker, the records show the motor carrier’s history and what the broker knew when it booked the load.