On May 14, 2026, the U.S. Supreme Court issued a unanimous 9-0 decision that changes the legal landscape for every freight broker operating in the United States. The case is Montgomery v. Caribe Transport II, LLC. 

The short version: freight brokers can now be sued in state court for negligently selecting an unsafe motor carrier. A federal defense that had been used for years to block those lawsuits no longer applies.

This article explains what the Court decided, what it does not mean, and what the practical implications are for freight brokers—particularly around carrier vetting practices and insurance coverage.

What happened and what the Court decided

In 2017, a driver employed by motor carrier Caribe Transport II veered off an Illinois highway and struck a stopped truck. The driver of that truck, Shawn Montgomery, lost his leg. The load had been arranged by C.H. Robinson, one of the largest freight brokers in the United States.

Montgomery sued C.H. Robinson, arguing the broker should have known the carrier had a poor safety record before putting it on the road. C.H. Robinson argued that federal law—specifically the Federal Aviation Administration Authorization Act (FAAAA)—blocked that kind of lawsuit against a broker entirely. That federal shield had worked for brokers in many courts for years.

The Supreme Court disagreed—ruling unanimously that federal law does not shield freight brokers from state-court lawsuits over negligent carrier selection. All nine justices held that the law does not protect brokers from negligent-hiring claims. The reason: federal law includes a safety exception that preserves states' ability to hold companies accountable for motor vehicle safety. Requiring a broker to choose carriers carefully falls under that exception.

The ruling was written by Justice Barrett. Justices Kavanaugh and Alito agreed with the outcome but wrote separately. The previous ruling that had protected C.H. Robinson was reversed. The case returns to lower courts.

What this does not mean

This ruling does not mean a broker is automatically responsible for every accident involving a carrier they hired.

To win a negligent-hiring case, the person suing still needs to prove that the broker knew (or should have known) that the carrier was unsafe before the load was tendered. A broker who checked a carrier's safety record, saw nothing concerning, and made a reasonable decision is in a very different position from one that overlooked documented safety concerns.

The FMCSA requires brokers to use federally registered carriers, but it does not set rules for how brokers are supposed to vet those carriers. That means state courts will decide whether a broker's selection process was reasonable, based on the facts of each case, without a federal standard to fall back on. How a broker vets carriers, and whether that process is documented, is now a more consequential question than it was before May 14.

Why the federal defense mattered and what changes without it

Before this ruling, brokers could often get negligent-hiring lawsuits thrown out early—before any investigation into how the carrier was selected. That defense no longer applies.

Within four days of the ruling, another federal court used the Montgomery decision to reopen a separate case against a freight broker that had previously been closed. The legal landscape shifted immediately.

What this means in practice: lawsuits that would have been dismissed before trial will now move forward. When they do, the other side will ask for the broker's carrier vetting records—what process was used, what safety data was reviewed, and what the carrier's history looked like at the time of the booking.

A broker with a clear, consistent carrier selection process on record is in a better position than one without. The absence of documentation matters on its own.

The insurance dimension

Most freight brokers carry general liability, contingent cargo, and contingent auto liability coverage. Contingent auto liability responds when a motor carrier's own insurance is not enough to cover a claim.

What many broker programs do not include is coverage at limits high enough to respond to a large negligent-hiring verdict. Trucking litigation has produced very large jury awards against motor carriers in recent years—the same courtroom environment now applies to brokers.

A few things worth understanding:

Current contingent auto limits are worth reviewing. Most contingent auto liability policies are written at $1 million per occurrence. A serious injury case with a negligent-hiring claim could produce a verdict above that amount. Whether current limits are appropriate for the size and type of freight a brokerage arranges is worth discussing with an insurance advisor.

Carrier vetting practices have taken on added weight. The safety history of the carriers a broker regularly works with—their safety ratings, inspection records, and operating history—is now a factor in how insurance coverage programs are structured and what options are typically available.

Excess liability coverage exists for situations where primary limits are not sufficient. Whether it is structured to respond to a negligent-hiring claim depends on the specific policy terms. Reviewing current coverage terms before a situation arises, rather than after, is generally the more practical approach.

What changes for carrier vetting practices

Keeping records of how carriers are selected has always been good practice. After this ruling, it carries more weight.

Checking safety data at the time of booking. Carrier safety ratings, inspection records, and out-of-service history are publicly available through SAFER Web at safer.fmcsa.dot.gov. Recording what the carrier's safety profile looked like at the time of selection creates a clear record of what was known and when.

Paying attention to how long a carrier has been operating. Newly registered carriers with little operating history present a different risk than established ones. The carrier in the Montgomery case had a publicly visible "conditional" safety rating—the kind of information that is available before a load is tendered.

Checking carriers regularly, not just once. A carrier's safety record can change over time. Platforms including Highway, Carrier411, and RMIS monitor carrier authority status, insurance certificates, and safety score changes on an ongoing basis—providing a more current picture than a single check at onboarding.

Having a written carrier selection process. A documented, consistently applied approach to selecting carriers creates a record that the decision was considered and based on available information—not made casually.

Following the ruling, industry observers noted that carriers able to demonstrate consistent safety histories may find themselves in greater demand from brokers. For brokers, that same documentation now serves a second purpose: a record of reasonable care in how carriers were selected.

The broader market implications

Industry analysts have described the decision as significant for the trucking industry as a whole, affecting large brokers and small ones alike.

Carriers with strong safety records become more attractive. Brokers now have a practical reason to prioritize carriers that can demonstrate consistent safe operations. Carriers that invest in safety programs and keep clean records may find themselves in more demand.

Smaller brokerages may feel the impact more directly. Larger brokers typically have dedicated compliance teams and established vetting systems. Smaller operations that have relied on informal processes may need to adjust both how they vet carriers and how their insurance program is structured.

Some states present higher exposure than others. Illinois, California, New Jersey, and Pennsylvania have historically produced larger jury awards in trucking cases. Lawsuits that were previously dismissed in those states on federal grounds may now move forward.

Frequently asked questions

Does this ruling mean brokers are automatically liable for accidents involving carriers they hired? No. The person suing still needs to prove that the broker knew (or should have known) the carrier was unsafe. A broker that checked a carrier's safety record, applied a consistent vetting process, and has documentation to show it is in a different position from one that overlooked safety concerns.

Does this affect intrastate shipments? The ruling applies to interstate brokerage—loads crossing state lines. Shipments arranged and completed entirely within one state are treated differently under current law.

What insurance coverage is most relevant to this ruling? Contingent auto liability is the primary coverage line that responds when a broker is named in an accident-related claim. Whether current limits are adequate for a serious injury case, and whether any excess coverage is in place, are the questions most worth reviewing with an insurance advisor.

Does the ruling apply to brokers who are also motor carriers? Any business arranging loads as a broker—regardless of whether it also operates trucks—may be subject to negligent-hiring liability for those arrangements. Operations that both haul freight and arrange it for others may carry a broader exposure than pure brokerages.

Where can the full ruling be read? The opinion is publicly available at the Supreme Court's website: supremecourt.gov/opinions/25pdf/24-1238_1b7d.pdf 

About GIA Group, LLC

GIA Group, LLC is an independent commercial transportation insurance agency working with freight brokerages, motor carriers, and logistics operations across the United States. As an independent agency, GIA Group works with multiple insurance programs specializing in commercial transportation to help brokerages find coverage suited to how their operations are structured—supporting stable, long-term coverage for freight brokerages and motor carriers operating across varied conditions.

The Montgomery decision changes what the insurance conversation looks like for freight brokers. Understanding current limits, how the contingent auto program is structured, and whether excess coverage is in place are practical questions worth addressing before a situation makes them urgent.

For a coverage review or a quote, contact GIA Group at 855-876-0717 or visit giasure.com/vehicles/freight-broker-insurance.

This article is for educational purposes and reflects publicly available court opinions and industry analysis as of June 2026. It does not constitute legal or insurance advice. Brokerages should consult a licensed attorney for legal guidance specific to their operations.