Supreme Court Limits Freight Brokers’ Preemption Defense Against State Law Negligent Hiring Claims

By Yaron Shaham and Jaion Chung

In a unanimous opinion on Thursday, May 14, 2026, the United States Supreme Court held state-law negligent hiring claims against freight brokers are not preempted by the Federal Aviation Administration Authorization Act (“FAAAA”) because such claims fall within the statute’s safety exception preserving state authority “with respect to motor vehicles.” The Court’s opinion in Shawn Montgomery v. Caribe Transport II, LLC, 608 U.S. ___ (2026) represents a major development in freight broker liability and transportation law.

Montgomery stems from a serious highway collision involving a motor carrier selected by a freight broker (i.e., the one who arranges for the freight shipment) to transport a shipment. The plaintiff, Shawn Montgomery, alleged among other things, that the motor carrier was unsafe and was negligently hired by the broker. However, the federal district court held the FAAAA expressly preempted Montgomery’s negligent-hiring claim against the broker and that the claim did not fall within the regulation’s safety exception. The Seventh Circuit affirmed.

Before the Supreme Court, Montgomery argued negligent hiring was a safety rule that protects the public on the roads. In opposition, the Federal Government/Trucking Industry argued the exception is limited to state rules with a direct connection to motor vehicles, not to how a broker chooses a carrier; thus, preemption to such claims applies under the FAAAA. The Supreme Court unanimously agreed with Petitioner Montgomery.

FAAAA Section 14501(c)(1) restricts a state’s ability to enact or enforce laws “related to a price, route, or service” of motor carriers, brokers, or freight forwarders in connection with transporting property. Brokers argued negligent hiring claims target “broker services” and therefore fall within this federal preemption. However, Section 14501(c)(2)(A) preserves a state’s “safety regulatory authority … with respect to motor vehicles.”

Since freight brokers can no longer rely on a FAAAA preemption argument to safeguard themselves from negligent hiring claims, it is critical they value carrier selection at all costs before any retention takes place. A freight broker should review, at a bare minimum, prior crash histories, inspection records, and Federal Motor Carrier Safety Administration (“FMCSA”) safety ratings. With the expected rise in freight broker negligent hiring lawsuits, freight brokers will now be subject to discovery and depositions that will open them to such inquiries and prior preparation, and homework will be key to avoiding possible liability. Utter indifference to publicly available information about a carrier will likely be met with disdain from jurors.

The Montgomery decision also aligns carrier accountability with that of the broker. Carriers are already subject to state law tort claims for unfit drivers or unsafe actions which result in a plaintiff’s injury. All parties in the chain of command as freight moves from one point to another are subject to the same lawsuit. Now, freight brokers also face the same reasonable standard of care requirement and must insure themselves for adequate financial protection.

One of the most likely economic consequences of the Montgomery decision will be that freight brokers have a definite financial incentive to retain only the best, well-rated, and safest carriers. Trucking companies with clean records, low BASIC (Behavior Analysis and Safety Improvement Category) scores, modern equipment, and a documented commitment to driver qualification just became significantly more valuable to brokers than the cheapest available truck. Freight brokers must shift towards carriers investing in safety, quality drivers, and pristine safety records.

The Montgomery decision provides freight brokers with immediate motivation to update and improve their internal retention standards and standards of care. Initially, there will likely be an upswing in lawsuits brought against them; however, a lawsuit in no way automatically equates to liability or a monetary payout. A plaintiff must still meet every burden of proof, and freight brokers will rely on defenses concerning FMCSA safety ratings, due diligence standards, and inspection data. Though the Supreme Court has opened the gates for freight brokers to be sued for negligent hiring, it remains to be seen if liability will land at their feet or the carriers (or both).