Montgomery v. Caribe Increases Litigation Activity, Not Shipper Exposure

A recent Supreme Court decision that is widely viewed as a significant development in transportation litigation is particularly worth examining in the context of negligent hiring claims against freight brokers.

The court’s decision in Montgomery v. Caribe Transport II, LLC holds that such claims fall within the Federal Aviation Administration Authorization Act’s (FAAAA) safety exception and therefore are not preempted, resolving a long-standing circuit split and removing a powerful threshold defense that brokers had increasingly relied upon.

For insurance carriers, however, especially those insuring shippers, the more important question to be considered is not what Montgomery says about broker liability, but what it does to upstream exposure.

Although plaintiffs have already begun citing Montgomery in an effort to expand liability across the transportation chain, the decision itself is narrow, broker-specific and notably silent on shippers. As a result, it does not materially alter the legal framework governing shipper liability. What it does change is the litigation dynamic, particularly at the pleading and discovery stages.

The background of the case shows that petitioner Shawn Montgomery sustained severe injuries after his tractor trailer was struck by a truck driven by respondent Yosniel Varela-Mojena, who was driving a load of plastic pots through Illinois for motor carrier Caribe Transport II LLC. Transportation broker C.H. Robinson Worldwide Inc. had coordinated the shipment. Montgomery sued all respondents in Federal District Court, alleging that C.H. Robinson was liable for his injuries because it negligently hired Varela-Mojena and Caribe Transport.

At its core, Montgomery is a case about statutory interpretation, not about expanding tort duties. Prior to the decision, courts agreed that negligent hiring claims against brokers were “related to” broker services under the FAAAA but were divided on whether those claims were saved by the statute’s safety exception. The Supreme Court adopted the view that such claims fall within a state’s preserved authority “with respect to motor vehicles,” even where asserted against non-carrier entities like brokers.

Crucially, however, that is where the holding ends. The court did not create new duties, endorse negligent hiring theories as a matter of policy, or suggest that liability should flow upstream to other participants in the logistics chain. Most importantly for carriers evaluating exposure, the court did not address shippers at all and did nothing to disturb the longstanding distinction between brokers and shippers embedded in both the statutory text and the broader regulatory framework.

That distinction continues to matter. The FAAAA’s preemption clause expressly lists motor carriers, brokers, and freight forwarders, but omits shippers. Courts have consistently treated that omission as intentional and have declined to extend the statute to parties acting purely as shippers. As a result, preemption has never been the primary defense for shipper liability in transportation accident cases. Instead, exposure has always turned on traditional tort concepts—namely duty, control, agency, and causation, and Montgomery leaves that framework entirely intact.

From a substantive standpoint, the decision does not expand the duties owed by shippers. Nothing in the court’s reasoning suggests that shippers must now supervise brokers, audit carrier selection practices or assume any new role in ensuring transportation safety. There remains no federal statutory or regulatory framework imposing such obligations, and the court did not attempt to create one. The analytical focus remains on the shipper’s role in selecting a broker, not on downstream operational decisions made by that broker or by the motor carrier it ultimately retains.

The independent contractor relationships that structure the transportation industry likewise remain unchanged. Courts continue to recognize that brokers and carriers operate independently, absent evidence of control over the manner and means of performance. Montgomery reinforces, rather than undermines, that principle by focusing squarely on the broker’s role in carrier selection. For carriers assessing indemnity risk, this preserves a critical barrier to vicarious liability claims against shippers.

Causation presents an additional, and often dispositive, constraint. The typical chain of events in these cases involves multiple independent actors: a shipper retains a broker, the broker selects a carrier, the carrier employs a driver, and the driver causes an accident. Courts have long been skeptical of attempts to attribute liability across that attenuated chain, and Montgomery does nothing to shorten or simplify it.

Despite these unchanged fundamentals, Montgomery is not without impact from a carrier’s perspective. The decision is likely to influence how plaintiffs frame their claims and how cases are litigated, even if it does not ultimately increase the likelihood of success on the merits. In particular, carriers should expect to see broader pleadings that more routinely include shippers as defendants, often under theories of negligent selection or “supply chain liability.” These claims may have limited legal viability, but they increase the complexity and cost of litigation at the outset.

The decision will also predictably expand the scope of discovery. Plaintiffs are likely to seek internal policies, communications and risk management materials in an effort to argue that the shipper assumed responsibilities beyond its traditional role. Plaintiff lawyers will continue to argue that shippers have a duty to select a broker who employs reasonable vetting procedures when selecting a motor carrier. This focus will result in questions of fact which may erode efforts to seek dismissal on summary judgment.

While courts have generally rejected the notion that voluntary safety practices create legal duties, such arguments can complicate discovery and delay early resolution. The result is a form of practical exposure, measured in defense costs and litigation burden, rather than a meaningful shift in liability risk.

These dynamics may influence early case valuation. With more parties in the case and broader allegations in the complaint, claims may appear more significant at the intake stage, leading to upward pressure on initial reserves. Over time, however, the same structural defenses that existed before Montgomery—lack of control, independent contractor status, and attenuated causation, should continue to reassert themselves.

Ultimately, what Montgomery means for shippers and their insurers is best understood as a distinction between procedural pressure and substantive exposure. The ruling is likely to generate more aggressive pleading strategies and more intensive discovery aimed at upstream parties. But it does not create new duties, alter the governing legal standards, or meaningfully expand the circumstances under which shippers can be held liable.

In that sense, Montgomery is a significant case, but a targeted one. It reshapes the litigation landscape for brokers, while leaving the core principles governing shipper liability largely untouched. For insurance carriers, the takeaway is straightforward: expect more activity at the front end of cases but recognize that the ultimate exposure analysis remains grounded in the same role-specific, control-driven framework that has long defined this area of law.

Schaer is a director at Zarwin Baum DeVito Kaplan Schaer where he chairs the litigation department and leads the insurance defense group. He is regularly hired by large national insurers, third-party administrators, motor carriers and businesses. He has tried more than 50 jury trial across the country.

DiBono is a shareholder at Zarwin Baum DeVito Kaplan Schaer. A member of the insurance defense group, he concentrates his practice on complex civil litigation, primarily defending clients in catastrophic injury cases involving commercial transportation, construction, products liability, and premises liability matters.