A New Risk Landscape: Supreme Court Expands Freight Broker Exposure Under the FAAAA

On May 14, 2026, the U.S. Supreme Court issued a significant transportation law decision in Montgomery v. Caribe Transport II, LLC, resolving a long-standing split among federal courts concerning the scope of the Federal Aviation Administration Authorization Act (“FAAAA”) and its effect on freight broker liability.

In a unanimous opinion, the Court held that state-law negligent hiring claims against freight brokers are not preempted by the FAAAA when those claims relate to motor vehicle safety.

The FAAAA and Federal Preemption

Since its enactment in 1994, the FAAAA has served as a cornerstone of federal transportation regulation. Congress enacted the statute to promote a uniform national framework governing interstate transportation services and to prevent states from imposing inconsistent regulations affecting the trucking industry.

To accomplish that objective, the FAAAA broadly preempts state laws “related to a price, route, or service” of motor carriers and freight brokers. Over time, however, courts struggled to define the limits of that preemption, particularly when state common-law tort claims intersected with federal transportation policy.

Freight brokers frequently relied on the FAAAA’s expansive preemption language to argue that negligent hiring and negligent selection claims were barred because such claims related to broker “services.” Federal courts reached inconsistent conclusions, creating uncertainty across jurisdictions.

The Supreme Court’s Decision

The Supreme Court rejected the broad preemption argument advanced by brokers and clarified the reach of the FAAAA’s “safety exception.”  Under that exception, state laws “with respect to motor vehicles” are preserved from federal preemption when they concern safety regulation. The Court concluded that negligent hiring claims fall within that exception because they impose a duty of reasonable care in selecting motor carriers and directly implicate motor vehicle safety.

Importantly, the Court emphasized that these claims “concern” the trucks and drivers used in interstate transportation and therefore remain subject to state tort law despite the FAAAA’s general preemption provision.

In practical terms, the ruling allows plaintiffs to pursue negligent selection claims against freight brokers in situations where many courts previously dismissed those claims at the pleading stage.

What This Means for Freight Brokers

The decision substantially increases potential litigation exposure for freight brokers. Going forward, plaintiffs are expected to focus heavily on:

• Carrier safety ratings;
• FMCSA compliance histories;
• Prior crashes and out-of-service records; and
• Broker onboarding and vetting practices.

Discovery will likely become more expansive and probe the extent to which brokers evaluated a carrier’s safety profile before tendering a load.

At the same time, the Court made clear that brokers are not automatically liable simply because an accident occurred. Plaintiffs must still establish both a failure to exercise reasonable care and causation.

As a result, brokers with well-developed and consistently applied carrier selection procedures remain in a significantly stronger defensive position.

Downstream Effects on Motor Carriers

Motor carriers should also anticipate meaningful downstream effects from the ruling. Brokers are likely to increase scrutiny of carrier safety performance and may adopt more stringent onboarding requirements, contractual protections, and insurance expectations. Carriers with strong safety records and well-maintained compliance documentation may gain a competitive advantage as brokers reevaluate risk management strategies.

The decision may also lead to increased requests for safety documentation, additional contractual representations regarding compliance, and more rigorous monitoring of FMCSA metrics throughout the broker-carrier relationship.

The Importance of a Defensible Process

Perhaps the most important takeaway from the Court’s decision is that future exposure will likely turn less on any single safety datapoint and more on whether a broker can demonstrate a reasonable, documented, and consistently applied vetting process.  Courts evaluating negligent hiring claims will likely focus on what a broker knew or reasonably should have known about a carrier’s safety history at the time of tender.

From a practical standpoint, this decision is not about guaranteeing perfect safety outcomes. Rather, it is about demonstrating a defensible process supported by thoughtful policies, consistent application, and adequate documentation.

Brokers relying on informal or inconsistent vetting practices may face greater exposure than those with structured onboarding protocols and clear documentation trails.

Recommended Next Steps

In light of the decision, brokers and carriers alike should consider proactively reviewing their operational and risk management practices, including:

1. Reviewing carrier vetting and onboarding procedures;
2. Auditing internal documentation and decision-making protocols;
3. Evaluating contractual protections and indemnity provisions;
4. Assessing insurance coverage and risk transfer mechanisms; and
5. Ensuring safety and compliance records are accurate, current, and readily accessible.

Looking Ahead

The Supreme Court’s ruling in Montgomery represents one of the most consequential transportation law developments in recent years. Its full impact will likely unfold over time as lower courts begin applying the decision in negligent hiring litigation across the country.

We will continue monitoring the application of this decision closely and its evolving impact on litigation nationwide.