For years, most brokers believed a federal law shielded them from lawsuits over the carriers they picked. On May 14, 2026, the Supreme Court unanimously said otherwise. Here is what the ruling actually holds, and the specific steps brokers should take if their compliance program hasn't caught up yet.
FreightBidder Team
FreightBidder
Ask a freight broker five years ago whether they could be personally sued over a wreck involving a carrier they'd hired, and most would have said no — federal law preempted that kind of claim. That assumption held up in enough courtrooms that it became conventional wisdom across the industry. On May 14, 2026, the U.S. Supreme Court closed that door, unanimously, in a case called Montgomery v. Caribe Transport II, LLC.
If you run a brokerage, this isn't background noise. It's a change in the actual legal exposure your business carries every time you tender a load. The ruling itself is a few months old now, but that's exactly the problem: the news cycle around it has largely passed, while a meaningful share of brokerages still haven't updated a compliance process that was built around an assumption the Court just eliminated.
Quick answer: in Montgomery v. Caribe Transport II, LLC, the Supreme Court ruled 9-0 that state-law "negligent selection" claims against freight brokers — lawsuits alleging a broker was careless in choosing which carrier to hire — are not preempted by the Federal Aviation Administration Authorization Act (FAAAA). The decision resolved a long-running circuit split and removed the main legal defense brokers had relied on to get these claims dismissed early. Brokers are now expected to demonstrate reasonable, documented care in carrier selection, or risk being held liable alongside the carrier when something goes wrong on the road.
The legal question at the center of Montgomery was narrow but consequential: does the FAAAA — a federal law that broadly preempts state regulation of motor carrier "prices, routes, or services" — also block state-law negligence claims against brokers for carelessly selecting an unsafe carrier?
For years, federal circuit courts disagreed. Some read the FAAAA's preemption language broadly enough to shield brokers from these claims almost entirely. Others recognized the statute's built-in "safety exception," which preserves a state's ability to regulate safety, as leaving room for exactly this kind of lawsuit. That split meant a broker's legal exposure genuinely depended on which federal circuit they got sued in — a strange and unstable place for an entire industry's risk model to rest on.
The Supreme Court resolved it unanimously, in an opinion authored by Justice Amy Coney Barrett: negligent-selection claims against brokers fall within the FAAAA's safety exception and are not preempted. In plain terms, a plaintiff injured by a carrier's negligence can now sue the broker who selected that carrier, arguing the broker failed to exercise reasonable care — and a broker can no longer count on federal preemption to get that claim thrown out before trial.
This ruling doesn't make brokers liable for every accident a carrier they've used is ever involved in. The claim has to be that the broker itself was negligent — that a reasonably careful broker would have caught something in the carrier's history, authority status, safety record, or insurance that this broker missed or ignored, and that failure contributed to the harm.
That distinction is exactly why documentation now matters as much as the underlying vetting decision. A broker who checked a carrier's authority, safety rating, and insurance, and can show when and how they checked it, has a real defense: reasonable care was exercised. A broker who can't produce that record — even if they actually did check informally — is in a much weaker position, because in a negligence case, the absence of documentation reads as the absence of process.
Attorneys and risk consultants who've published guidance since the ruling converge on roughly the same list. None of it is exotic — most of it is what good brokerages were already doing informally. The shift is making it formal, consistent, and provable.
Document every vetting decision, with timestamps. Authority status, safety rating, insurance verification, and any other criteria you apply need to be checked and recorded before a carrier is tendered a load — not reconstructed from memory after a claim arrives years later.
Verify before tendering, every time. Spot-checking carriers occasionally isn't a process a court will recognize as reasonable care. The standard is a repeatable check applied to every carrier, every load.
Talk to your insurance broker now. Ask directly whether your current coverage responds to a negligent-selection tort claim, and what your actual exposure looks like in this new legal environment. Contingent liability and errors & omissions coverage that seemed adequate under the old preemption assumption may need a second look.
Put your vetting policy in writing. An informal process that lives in one dispatcher's head isn't defensible. A written policy — reviewed and followed consistently — is.
Treat vetting records as litigation-critical, not administrative overhead. The standard many firms are recommending: a broker should be able to show, for any load, exactly what was checked on that carrier and when — searchable and defensible years after the fact, since these claims typically surface long after the load has delivered.
The practical effect industry-wide is higher costs, concentrated hardest on brokers who were already cutting corners on vetting or running thin insurance coverage to keep overhead low. Expect broker liability and E&O premiums to rise as insurers reprice this exposure. Expect smaller, undercapitalized brokerages — the ones without a formal compliance function — to feel this hardest, since building a documented vetting process from scratch under legal pressure is a lot more expensive than having had one running all along.
This isn't a reason to exit brokerage. It's a reason to treat carrier vetting as core infrastructure rather than a box-check before award — which, if you've been running a brokerage well, is probably close to how you already treated it.
The single biggest operational gap this ruling exposes is the same one that made vetting inconsistent in the first place: manually checking FMCSA data for every carrier, every load, and keeping a defensible record of it, is genuinely tedious work that gets skipped under deadline pressure.
FreightBidder's AI-powered carrier vetting was built around this exact problem before this ruling made it urgent. Every carrier is checked against real-time FMCSA data — operating authority, safety rating, insurance status — before they're allowed to bid at all, and that check happens automatically, consistently, and on a timestamp, not as an occasional manual lookup. Our carrier vetting guide covers the full framework of what to check and why; the mechanics of actually doing it consistently are what the platform handles.
For brokers building their compliance program from the ground up, see our guide to becoming a freight broker for the licensing and bonding side, and our breakdown of what tech actually matters for the operational stack — carrier compliance management was already the pillar we said was non-negotiable, for exactly this reason.
None of this is legal advice, and this article isn't a substitute for talking to your own counsel and insurer about your specific exposure. The point is narrower and more urgent: if your carrier vetting process isn't documented, timestamped, and applied consistently to every load, the fact that this ruling is a few months old doesn't make it less relevant — it means the window to catch up before it matters in a real claim is already closing.
FreightBidder's freight broker software builds carrier vetting into the load board itself — every carrier bidding on your loads has already cleared real-time FMCSA verification, with a plain-language risk summary and a timestamped record behind it. That's not a compliance add-on; it's how the platform works by default.
Create a free broker account to see how vetted carrier bidding works before you commit to a plan.
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