Broker Liability And Federal Preemption: U.S. Supreme Court To Consider The Road Ahead

Freight brokers play a critical role in the modern supply chain. Rather than owning trucks or employing drivers, they match shippers with licensed carriers and keep goods moving across the country. Although a freight broker's work usually occurs behind the scenes, questions often arise about the scope of their responsibility when motor accidents occur. In those situations, plaintiffs have increasingly turned to brokers for recovery, alleging that they negligently hired the carrier involved in the loss. Whether such negligent hiring claims overcome federal preemption lies at the center of a deep divide among federal circuit courts. But this split will soon be resolved. Just last week, the Supreme Court granted certiorari in Montgomery v. Caribe Transportation II, LLC, 124 F.4th 1053, 1058 (7th Cir. 2025), cert. granted, 2025 WL 2808807 (U.S. Oct. 3, 2025), a case poised to address the preemption question once and for all.

At the crux of the dispute is the Federal Aviation Administration Authorization Act of 1994 (the "Act"). Despite its name, the statute goes beyond aviation to include motor carriers, freight forwarders, and freight brokers engaged in interstate commerce. Congress passed the Act, in part, to promote national uniformity in transportation regulation. See City of Columbus v. Ours Garage & Wrecker Serv., Inc., 536 U.S. 424, 440 (2002) ("[S]tate economic regulation of motor carrier operations . . . is a huge problem for national and regional carriers attempting to conduct a standard way of doing business.") (quoting H.R. Conf. Rep. No. 103–677, p. 87 (1994))). To help achieve this goal, the Act includes a preemption clause, barring states from enacting or enforcing any law "related to a price, route, or service" of a motor carrier, broker, or freight forwarder "with respect to the transportation of property." 49 U.S.C. §14501(c)(1). By its terms, "related to" expresses a "broad pre-emptive purpose," See Morales v. Trans World Airlines, Inc., 504 U.S. 374, 383 (1992),reaching any state law "having a connection with or reference to" broker services, whether directly or indirectly, see Dan's City Used Cars, Inc. v. Pelkey, 569 U.S. 251, 260 (2013) (quoting Rowe v. New Hampshire Motor Transport Ass'n, 552 U.S. 364, 370 (2008)); Ye v. GlobalTranz Enters., Inc., 74 F.4th 453, 458 (7th Cir. 2023).

Still, the statute includes an important carveout called the "safety exception." This clause preserves "the safety regulatory authority of a State with respect to motor vehicles." 49 U.S.C. §14501(c)(2)(A). Courts of appeals disagree about whether this exception shields brokers from negligent hiring claims. The Seventh and Eleventh Circuits have held that it does not, emphasizing that brokers do not themselves operate motor vehicles and that their activities do not have a "direct link" to motor vehicle safety. See Ye, 74 F.4th at 463; Aspen v. Robinson Worldwide, Inc., 65 F.4th 1261 (11th Cir. 2023). Under this view, the Act preempts negligent hiring claims against brokers. In Montgomery, now before the Supreme Court, the Seventh Circuit reaffirmed this prior holding.

But the Ninth and Sixth Circuits have reached the opposite conclusion. These courts have determined that a broker's choice of carrier is itself a safety-related act, and that state tort duties requiring reasonable care in such hiring fall within the safety exception. See Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1025 (9th Cir. 2020); Cox v. Total Quality Logistics, 2025 WL 1878770, at *5 (6th Cir. July 8, 2025). After all, these courts reason, "brokers are ultimately responsible for placing such motor vehicles on the road." See Cox, 2025 WL 1878770, at *8.

Brokers operating in Louisiana, Mississippi, and Texas face particular uncertainty. Although the Fifth Circuit has yet to speak directly to the issue, district courts within the circuit are divided. Some trial courts have chosen to follow the Eleventh Circuit's reasoning that negligent hiring claims are preempted, see, e.g., Domingue v. Costco Wholesale Corp., 2025 WL 2429045, at *3 (S.D. Tex. July 3, 2025); Bailey v. Progressive Cnty. Mut. Ins. Co., 2024 WL 3845966, at *3 (E.D. La. Aug. 16, 2024); Hamby v. Wilson, 2024 WL 2303850, at *4 (E.D. Tex. May 21, 2024), while others have adopted the Ninth Circuit's view that such claims fall within the safety exception, see, e.g., Glover v. Argonaut Ins. Co., 2025 WL 1805708, at *4 (M.D. La. June 30, 2025); Bertram v. Progressive Se. Ins. Co., 2021 WL 2955740, at *6 (W.D. La. July 14, 2021). This division within the Fifth Circuit, and across the country, carries practical consequences for brokers: the legal standard governing their liability depends not on federal uniformity, but on the fortuity of where a case is filed. In Montgomery, the Supreme Court has chance to settle the preemption dispute and bring more predictability to the interstate transportation sector. Whether it holds that federal preemption bars negligent hiring claims entirely, or that the safety exception preserves them, its ruling will indisputably shape the future of interstate commerce.

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