Supreme Court Removes Legal Shield for Freight Brokers, Exposing Industry to Liability Risks
The U.S. Supreme Court ruled unanimously in Montgomery v. Caribe Transport II that freight brokers can be held liable for negligent carrier selection, removing the Federal Aviation Administration Authorization Act (FAAAA) preemption shield they had relied on. This decision increases legal exposure and highlights a significant insurance gap as current surety bond requirements are insufficient to cover potential liabilities.
Topics: FAAAA preemption freight brokerage insurance liability legal precedent surety bonds