Montgomery v. Caribe Transport II: What Every Freight Broker Needs to Know

Jun 2
4 min read

The freight brokerage industry has spent years debating one critical legal question:

Can a freight broker be held liable for selecting an unsafe carrier? The U.S. Supreme Court has now provided a clear answer.

In its unanimous decision in Montgomery v. Caribe Transport II, LLC, the Court ruled that state-law negligent hiring claims against freight brokers are not preempted by the Federal Aviation Administration Authorization Act (FAAAA). In practical terms, this means brokers can face lawsuits alleging they failed to exercise reasonable care when selecting a motor carrier involved in a serious accident.

While the decision does not automatically make brokers liable for carrier accidents, it significantly changes the legal landscape and raises the stakes around carrier vetting and ongoing monitoring.

What Happened?

Montgomery v. Caribe Transport II stems from a 2017 crash in Illinois involving a carrier selected by C.H. Robinson. The plaintiff alleged that the broker should have known the carrier presented safety concerns and was therefore negligent in selecting them for the shipment. Lower courts initially ruled that federal law preempted the claim. The Supreme Court disagreed.

The Court held that negligent hiring claims fall within the FAAAA's "safety exception," allowing states to regulate matters concerning motor vehicle safety. As a result, claims alleging a broker negligently selected an unsafe carrier can proceed under state law.

Why This Matters for Freight Brokers

For many brokers, federal preemption served as a significant defense against negligent selection lawsuits. That defense is now substantially weakened.

Going forward, plaintiffs' attorneys will likely place greater scrutiny on broker carrier-selection practices, especially in cases involving catastrophic injuries or fatalities. The central question will no longer be whether a claim can be brought, but whether the broker exercised reasonable care when selecting the carrier.

This creates a new reality for freight brokers:

Carrier selection decisions may receive increased legal scrutiny.
Documentation of vetting procedures becomes more important.
Ongoing carrier monitoring may become just as critical as initial onboarding.
Internal policies and technology systems may play a larger role in defending broker decisions.

The brokers who can demonstrate a consistent, documented process for evaluating carrier safety will likely be in a stronger position than those relying solely on basic compliance checks.

The Shift from Compliance to Risk Management

Historically, many brokers have viewed carrier onboarding as a compliance exercise:

Is the authority active?
Is insurance in place?
Are required documents complete?

Those checks remain important, but the Montgomery decision may push the industry toward a broader risk-management approach.

Plaintiffs will likely examine factors such as:

Safety ratings and inspection history
Out-of-service percentages
Crash history
Insurance coverage issues
Fraud indicators
Changes in ownership or operating authority
Emerging safety concerns after onboarding

The challenge is that carrier risk is not static. A carrier that appears compliant today may develop significant risk indicators weeks or months later.

That's why ongoing monitoring is becoming increasingly important.

Why Continuous Monitoring Matters

The freight market moves quickly. Brokers routinely work with thousands of carriers across their network, making manual oversight nearly impossible.

Continuous monitoring solutions help brokers identify changes that may warrant further review, including:

Authority status changes
Insurance lapses
Safety alerts
Fraud indicators
Regulatory actions
Identity and ownership concerns

Rather than relying solely on a point-in-time onboarding review, brokers gain visibility into developing risks throughout the carrier relationship.

As legal scrutiny around carrier selection increases, having a documented process for both vetting and monitoring may become an important component of risk mitigation.

The Role of Technology

Technology alone cannot eliminate liability, but it can help brokers build more defensible carrier-selection processes.

Solutions such as Highway, which integrates with Sunnybrook TMS, help brokers automate carrier onboarding, identity verification, fraud prevention, and carrier monitoring workflows. By providing greater visibility into carrier risk signals, brokers can make more informed decisions and maintain stronger oversight across their carrier network.

The goal is not simply to check a compliance box. It is to establish a repeatable process that supports safer carrier selection decisions and provides documentation when those decisions are later questioned.

What Should Brokers Do Now?

The Montgomery decision does not require panic, but it does require attention.

Freight brokers should consider:

Reviewing carrier onboarding standards.
Evaluating how carrier safety information is documented.
Assessing ongoing carrier-monitoring capabilities.
Updating internal policies around carrier qualification.
Ensuring technology systems support consistent and auditable workflows.

The brokers most likely to succeed in this new environment will be those that treat carrier vetting as a continuous risk-management function rather than a one-time compliance requirement.

Final Thoughts on Montgomery v. Caribe Transport II

The Supreme Court's decision in Montgomery v. Caribe Transport II marks one of the most significant broker liability rulings in recent years. While the ruling does not create automatic liability, it clearly signals that carrier selection practices can be examined in court when serious accidents occur.

For freight brokers, the takeaway is straightforward: documenting a thoughtful, consistent, and defensible carrier-selection process is more important than ever.

As legal expectations evolve, strong vetting procedures, continuous monitoring, and the right technology tools will increasingly separate proactive risk management from avoidable exposure.

Catch you on the road,

The Sunnybrook TMS Squad