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PaperclipPerfector  1mo ago (text post)   3042 thread views

Small-Scale Question Sunday for May 17, 2026

Do you have a dumb question that you're kind of embarrassed to ask in the main thread? Is there something you're just not sure about?

This is your opportunity to ask questions. No question too simple or too silly.

Culture war topics are accepted, and proposals for a better intro post are appreciated.

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So is anyone planning on doing an effortpost on "Montgomery v. Caribe Transport II, LLC" that dropped last week?

Transport brokers lost immunity for hiring trucking companies with bad safety track records. It's causing some chaos and loops in the CDL and foreign driver discussion.

The important thing is that the trucking industry didn't prepare and because it came into full force immediately there's some chaos.

I'm asking because if someone with more legal and shipping knowledge than me does a write up, anything I write will look pretty half assed.

This should link to the twitter trend: https://x.com/i/trending/2055714473541771375

Not an effort post, but two paragraph in a weekly brief my team writes:

In a unanimous ruling, the US Supreme Court ruled that a trucking freight broker could be sued for arranging freight shipments using trucking companies they hired negligently, e.g., ignoring red flags. This ruling upends the freight trucking industry and could push many smaller motor carriers and freight brokers out of business and many drivers out of trucking. Insurance costs for brokers are expected to increase by a factor of 5 to 10, and some brokers may not be able to obtain insurance at all. Truckload spot rates are spiking. At least some companies with spotty track records can no longer get loads to drive as brokers are already making more careful selections. Increasing trucking freight prices are likely to drive additional inflation faced by both producers and consumers.

A shortage of synthetic industrial lubricants is anticipated to start affecting the US and Europe over the coming weeks. Production at the Shell Pearl GTL facility in Ras Laffan, Qatar was halted after the facility was struck by Iran in March. The Shell Pearl facility, together with far smaller facilities in the UAE and Bahrain, produced 20-30% of the world’s supply of Group III base oils. These base oils are used in a variety of applications, including synthetic motor oils and automatic transmission fluid. Lower-quality base oils can be substituted for Group III base oils in some of these applications better than in others. Shortages of products containing Group III base oils can be expected to start appearing by June and July, as retailers face losses of new supplies; price increases are expected, and some products are likely to be reformulated.

This ruling upends the freight trucking industry and could push many smaller motor carriers and freight brokers out of business and many drivers out of trucking.

I heard that the influx of cheap "no-questions-asked" carriers already did it with many existing businesses. So maybe if those carriers are forced out, the previous ones would come back? This indeed could cause some raise of the prices, but the question is would it be a panic raise or "going back to the level of 10 years ago" raise?

the previous ones would come back?

Here I'm just speculating, but there are frictions. You can't just boot up a relatively capital intensive business just like so?

The rigs that are driven by cheap foreigners are rarely owned by them I imagine. Somebody owns them. That somebody could keep the rigs and start hiring natives?

I was considering doing an effort post on the the decision and the DoT audits as sort of post-mortem/follow-up to my post from 3 months ago

But have been busy with normal life stuff.

I would recommend Freightwaves.com if you want an inside view.

I don't have much shipping knowledge but I can make some predictions based on my knowledge of personal injury litigation generally. Suppose a trucker gets into a crash with an automobile, the trucker is at fault, and the injured driver of the auto sues the trucking company. Let's say the driver got rear-ended while waiting at a stoplight, and the driver is employed by the trucking company. The trucking company will be responsible for the driver's negligence, and thus the entirety of the judgment, since in this case a jury would be likely to find the trucker 100% at fault. The broker's, however, is not directly liable for the negligence of the trucker; they are only liable to the extent that they knew or should have known that using that particular company was unjustifiably risky. If the trucking company in the example was a reputable outfit with a safety record typical of the industry, it's unlikely that the broker would be at fault. If it was a disreputable company with a terrible safety record or a fly-by-night outfit that they didn't properly vet and hired because they came in with the low bid, then it's more likely that they will be found responsible. But in the event that they are responsible, their share of the settlement is going to be much lower than that of the trucking company.

The extent to which this will affect the industry is hard to judge, because it all depends on custom, and how likely the ruling is to affect custom. The most immediate effect I can see is that every PI case involving a truck will name the broker as defendant if there is one, even in cases where the broker has no liability. While the ultimate result of many of these will be that the plaintiff agrees to voluntarily dismiss the broker from the suit, the broker will still incur defense costs, which will be reflected in insurance premiums. Here's where custom comes in: It could be the case that PI lawyers are already suing brokers in these cases, but the brokers are settling before the issue can be decided. The brokers may have heretofore taken an official stance that they were immune to such suits, but they may have been willing to settle them anyway, or they may have been let out of the case after discovery didn't uncover any evidence of negligent hiring.

If this seems odd to you, keep in mind that litigating a case to verdict is very expensive, the potential for huge losses exists in the event of an unfavorable award, the broker's share of the damages is relatively low in a fair trial, and one defendant can't force another defendant's hand. Take the example above. Suppose that both defendants take the case to trial, and the jury awards the plaintiff $3 million, apportioned 80% to the trucking company and 20% to the broker. During the trial, plaintiff's counsel has to argue that both the trucking company and the broker are negligent. Now suppose that the trucking company settles before trial, which is likely to happen, especially since the case isn't that unusual. The broker will file a motion for summary judgment arguing that the case is preemted by Federal law, but it's not likely to be granted, especially in state court. Unless the issue is well-settled, most judges are unlikely to boot a case entirely at the summary judgment stage over a technicality. So long as the Plaintiff can make a plausible argument that the case should continue, a judge is likely to grant it. And even if they get dismissed sometimes, sometimes isn't all the time.

Now the situation is quite different. At trial, the plaintiff no longer has to prove that the trucking company was negligent, and they have every incentive to try to stick the broker with as much of a share of the verdict as possible. Now the broker's situation gets a lot more complicated since in addition to their usual defense they have to now put on a negligence case against the trucking company, which would be difficult enough if they weren't also trying to argue that they had no idea how irresponsible that company was. And if by some miracle you get a defense verdict, that doesn't resolve the immunity issue, so you'd have to try the whole thing again next time.

Given that resolving the issue would involve going to trial, losing, and getting it overturned on appeal, there's significant incentive to settle, especially when the threat of the case being overturned on appeal may put downward pressure on the settlement. Extra especially when you aren't even the target defendant. Cases usually only go to trial when something goes completely off the rails. The point I'm making is that if it's already customary for brokers to get sued and pay settlements in these cases, then clarification isn't going to have much of an effect other than that the settlement amounts may go up a little. The effect on legal fees is likely to be minimal. If the broker being sued here was a novelty, then the effect will be much bigger. That being said, time-limited searches of PI attorney websites seem to suggest that going after brokers was a common practice well before this case was decided.

Possibly, if I have time (which has been in short supply lately), but I would have to do research and anything I produce is going to be half-assed. I dispatch for a mid-sized trucking that's a subsidiary of a larger company (meaning that they're very risk averse, as anything trucking screws up exposes the company as a whole to liability). I don't handle brokering.

The company I work for exclusively does tanking and (limited) hazmat tanking, so we're not really exposed to competition from the cardboard nameplate crowd. That said, compliance and litigation costs have been brutal in the last 5 years, as have been the effects of our efforts to enhance safety on driver retention. Fatalities aside, trucking companies have also been subject to the same issues as the rest of the auto industry in terms of property damage liability (Everything is expensive and costs more to repair.).

Fatal truck accidents were up something like 30% in the last 10 years as of 2024, but it's worth noting that overall accident fatalities spiked from 2020-2024, and only now do we have early estimate data for 2025 suggesting that we're back to the pre-pandemic trend (I wasn't able to find truck fatality data for 2025.). That said, while truck fatalities did spike during the pandemic and have fallen some since peaking in 2022, they were also increasing before the pandemic at the same time that car fatalities were falling, so it seems that truck fatalities are something of their own issue not strictly correlated with traffic fatalities as a whole (Note, much of the increase in traffic fatalities concerning cars has been from pedestrian deaths.).

Non-domiciled CDL holders (aka. foreign drivers) have been involved in a rash of high profile accidents, prompting a crackdown on non-domiciled CDLs, but the federal government doesn't track accident rates based on CDL type, so there is no data that presents a smoking gun suggestion that non-domiciled CDL holders have a higher crash rate than US citizen drivers.

This Supreme Court ruling stabs at a related but different and potentially more meaningful problem, so-called "chameleon carriers" and companies like Super Ego that hire them.

Non-domiciled CDL holders (aka. foreign drivers) have been involved in a rash of high profile accidents, prompting a crackdown on non-domiciled CDLs, but the federal government doesn't track accident rates based on CDL type, so there is no data that presents a smoking gun suggestion that non-domiciled CDL holders have a higher crash rate than US citizen drivers.

Interestingly, Canada has a similar, or maybe even worse, issue. Ontario's truck licensing program is in the hand of a company that has a major corruption scandal. Of course the CBC is carefully avoiding mentioning it but the main beneficiaries of the corruption are recent Indian arrivals, hence why the trucks in question (Ontario plates and Indian drivers) are called "flying carpets". Now if Ontario doesn't care that's one thing, but Ontario trucks find themselves all over North America, especially since these practices make them undercut other Canadian trucking companies.

Which safety measures cause the most driver resistance?

Driver facing cameras: We don't have them, but even rumors about us getting them causes drivers to look for other jobs.

Most generally, "safety scores" generated by the on-board ELD that penalizes for things like speeding (mostly problematic on not always correctly mapped rural roads), harsh braking, following too closely (This one can be a pain in major cities.), etc. The company recently tightened up the guidelines without notice, applied them retroactively (much to the chagrin of operations), and cost a bunch of drivers their quarterly safety bonuses.

Thirdly, collision avoidance/lane departure tech on company trucks. Apparently these have a false trigger rate somewhere above zero. Of course, most of the drivers I hear from wish we'd go back to manual transmissions (I guess the ones who don't care/like the automatics aren't as vocal about it, but our drivers are also a fairly old bunch for the most part.).

Finally, I don't think drivers are seriously opposed to ELDs as a concept, but many of them have trouble working with the (rather bug prone, in my experience) tablets.

Thirdly, collision avoidance/lane departure tech on company trucks. Apparently these have a false trigger rate somewhere above zero. Of course, most of the drivers I hear from wish we'd go back to manual transmissions.

I wouldn't dismiss their concerns so quickly. The collision-avoidance "feature" on my Mitsubishi Mirage (just a beeping/flashing warning, not a newfangled one that brakes automatically) had something like one false positive per hour on the six-hour drive that I took earlier today (taking a non-Interstate scenic route, so maybe less relevant for truckers).

Honestly, I suspect that the drivers are right, and if it were up to me we'd buy manual transmissions and as little of that stuff as can be ordered. The non-safety electronics on these trucks are frequently unreliable trash, so why would the safety systems be any better? I say this as one of our brand new trucks with 30K miles on it randomly went into derate or something and had a sudden and complete loss of power going 65 miles an hour down the road this afternoon and is now dead on the side of the road waiting for a tow.

On a more broad perspective (including auto safety), I do find it discouraging that all this expensive technology has accomplished precisely nothing in terms of safety (at best, enabling keeping a worse class of driver on the road; I suppose one could argue that we'd have even more deaths without the new tech given the current state of drivers).

Speaking for myself, the only safety device I appreciate on newer cars is the backup cameras (They really do make parking a pickup truck easier.), and even that's compensating for the fact that cars are built like tanks these days with frequently poor outward visibility.

This should link to the twitter trend

Note: This link works only for people with Twitter accounts, and is not supported by Nitter.

Text of opinion

Kavanaugh concurrence:

As I see it, the conflicting contextual considerations make this a close case as we determine how to construe and where to draw the line on the statutory phrase “with respect to motor vehicles”. In the end, I do not believe that Congress, through such oblique language in an economic-deregulation statute, simultaneously (i) allowed state tort suits against negligent trucking companies and (ii) categorically preempted state tort suits against upstream brokers who negligently select an unsafe trucking company. The brokers and their amici raise serious concerns about the repercussions of state tort liability against brokers, and they may of course (among other possibilities) ask Congress and the President to change federal law. But, as of now, federal law does not preempt state tort liability against brokers for negligent selection of trucking companies.

Industry news source:

The Supreme Court just told every freight broker that it can be sued

The legal standard is ordinary care. The question a jury will now be permitted to ask in every state in America is whether the broker exercised reasonable care in selecting the carrier. That means: Did you check the carrier’s safety record? Was the carrier’s FMCSA data available to you? Did the data show elevated crash rates, conditional safety ratings, high out-of-service percentages, or prior enforcement history? Did you have a documented process for evaluating carrier safety? Or did you book the cheapest truck and move on?

If you are a freight broker operating in the United States today, the preemption defense you have been relying on since 2023, when the Seventh Circuit decided Ye v. GlobalTranz, is gone. You are now subject to state tort law in every jurisdiction where you arrange transportation. The carrier you select, the safety record you ignore, the data you decline to check, all of it is discoverable. All of it is admissible. All of it can be presented to a jury.

This decision removes the federal shield that was blocking an old theory. Negligent hiring is a tort theory that has existed for generations. The Restatement (Second) of Torts, Section 411, imposes a duty of reasonable care in employing a contractor for work carrying a risk of physical harm. Barrett cited it in the opinion.

Plaintiffs' attorneys who handle commercial motor vehicle crash cases have been building these case files for years, waiting for the preemption question to resolve. The dockets are ready. The carrier safety data is public. FMCSA’s SAFER system is free. A broker’s carrier selection history is discoverable in litigation. The inspection records showing which carriers a broker habitually dispatched, and what those carriers’ safety profiles looked like at the time of dispatch, are all federal records.

The first wave of post-Montgomery negligent-hiring suits against brokers will be filed within the next few weeks. They will name brokers who selected carriers with known safety deficiencies, conditional ratings, elevated BASIC percentile scores, prior out-of-service orders, and authority less than 18 months old. The discovery requests will seek the broker’s carrier vetting policies, internal screening criteria, communications with the carrier prior to dispatch, and any safety data the broker reviewed or failed to review.

If a broker has no documented carrier vetting process, that absence is itself evidence.

Kavanaugh flagged this in his concurrence, and it deserves its own discussion. The FAAAA mandates minimum insurance coverage for motor carriers. It does not mandate comparable coverage for brokers. The existing broker surety bond requirement under 49 U.S.C. Section 13906 is $75,000. That is not liability insurance. That is a financial responsibility bond intended to ensure payment to carriers and shippers. It does not cover tort claims.

Most freight brokers carry some form of general liability and contingent cargo coverage. Very few carry the kind of excess liability coverage that would respond to a catastrophic negligent-hiring verdict. The nuclear verdict environment in trucking litigation has produced eight-figure and nine-figure outcomes against motor carriers. Those same jury dynamics now apply to brokers.

The insurance industry has not yet priced this exposure. When it does, freight broker premiums will adjust. The adjustment will be significant for brokers who cannot demonstrate a documented, data-driven carrier selection process. The adjustment will be less severe for brokers who can show that their vetting methodology is systematic, repeatable, and grounded in publicly available safety data.

The carriers a broker habitually selects, their safety profiles, their authority ages, their crash histories, their inspection outcomes, all of that is now part of the risk profile that an underwriter will evaluate.

This is not complicated. The court did not rewrite the rules of physics. It removed a procedural shield. The underlying obligation to exercise reasonable care in selecting a carrier is the same standard every other industry participant already operates under. Shippers exercise care in selecting carriers. Carriers exercise care in hiring drivers. Brokers are now held to the same standard.

Montgomery v. Caribe Transport is not just a broker case. Kavanaugh acknowledged this implicitly when he discussed 3PLs, freight forwarders, and digital freight platforms that make carrier selection decisions. The opinion is written about brokers because C.H. Robinson is a broker. But the logic applies to anyone in the supply chain who selects a carrier and has access to publicly available safety data showing that the carrier presents an elevated risk.

The court said that requiring a party to exercise ordinary care in selecting a carrier concerns motor vehicles. That is a principle. It does not stop at licensed broker authority holders.

Shippers who select carriers directly are not preempted and never were. But shippers who relied on the assumption that their broker’s preemption defense would insulate the entire transaction from negligent-selection liability need to rethink that assumption. The broker can now be sued. The broker’s defense will include evidence of what the shipper knew, what the shipper required, and the shipper’s own carrier-selection criteria.

Associated Press:

Supreme Court revives suit against major logistics company with potentially big effects on industry

The Trump administration and companies such as Amazon had argued that letting the suit go forward would expose logistics companies to liability under a “patchwork” of state laws.

Montgomery’s appeal was backed by more than two dozen states. They said a win for him would help bolster safety in an industry that moves billions of tons of goods across billions of miles every year.

The ruling could have far reaching effects if brokers can be held liable for the actions of the trucking companies they hire, said Brian Watt, who runs a freight logistics company in Florida.

Brokers will now have to focus more on the safety records of the truckers they contract with to haul all kinds of goods, including hazardous materials, instead of just looking for the cheapest and fastest option.

The Transportation Department has been cracking down on the trucking industry over the past year by trying to force unqualified drivers, trucking companies and schools out of the industry.

This is going to play merry hell on owner-operators. Nobody's going to want to underwrite one guy with one truck.

I think owner operators will be fine. They already have to carry their own insurance, and it's much easier for a broker to vet a single driver than a company with a revolving door of people who couldn't get hired anywhere else. The law that putatively granted immunity to brokers was enacted in 1994; it's not like owner-operators didn't exist before then.

Yes, but we have 30 years more of technological development in lawfare now. Think of how many doohickeys and doodads you can bring up to the jury.

Did you ask whether the engine was governed at 70mph? "No"

Did you ask whether the 80,000 pound truck you hired was equiped with a collision detection system like you have in your personal Kia? "No"

Did you ask whether the truck was equiped with a lane depature warning system? "No"

Was it a red flag that the carrier you hired barely spoke English? "No"

Most brokers are probably already asking those questions, and if they aren't, I'd wonder why their attorneys haven't developed a standardized form yet. The only suspect one is the last one, since English comprehension would only be relevant if the driver misread a sign or something. You could still ask at the deposition, but probably not at trial.

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