Before the landmark Supreme Court ruling on broker liability, some courts had held that brokers could not be sued for negligent hiring. A federal appeals court has already sent one such case back to the trial court in the new legal landscape shaped by the Supreme Court ruling.
Can brokers be held liable for negligent hiring when an unsafe motor carrier they hired is involved in a crash?
That question has been the center of a heated debate, with even federal circuit courts disagreeing on the answer.
Four circuit courts have ruled on broker liability. The Ninth and Sixth Circuit Courts have ruled that brokers are on the hook. Meanwhile, the Seventh and 11th Circuit Courts invoked Federal Aviation Administration Authorization Act (FAAAA) preemption.
Earlier this month, the Supreme Court put that debate to rest. In a unanimous decision, the high court sided with the Ninth and Sixth Circuit Courts, finding that a trucker who lost a leg in a crash with another truck can sue C.H. Robinson for negligent hiring.
While the Supreme Court case was pending, several broker liability cases throughout the country were on hold. One of those cases involves Echo Global Logistics.
In January 2022, a motor carrier that Echo Global Logistics hired, S&J Logistics, crashed into multiple vehicles stuck in construction traffic on Interstate 85 in South Carolina. One man was killed, and his family sued the shipper, carrier and broker.
Plaintiffs’ attorneys in the case argued that Echo Global Logistics should have known that S&J Logistics was an unsafe carrier. According to the lawsuit, a look at the Federal Motor Carrier Safety Administration’s publicly available data would have revealed the following about the carrier:
- An authorized motor carrier for less than 12 months
- No safety rating
- Only three trucks
- Out-of-service violation history above national average
Further inquiry would have shown the carrier had:
- No driver training program as required by FMCSA
- No policies, procedures, or programs in place for safety, quality control, vehicle maintenance, or other requirements under the FMCSA
- Driver/co-owner just graduated from truck driving school less than two years earlier and had been submitting falsified or inaccurate logbooks
In January 2024, a South Carolina federal district court dismissed Echo Global Logistics from the case. Since South Carolina falls within the Fourth Circuit, which has not ruled on broker liability, the district court judge drew from other appellate courts that have. In this case, Judge Jacquelyn Austin sided with the Seventh and 11th Circuit Courts, dismissing the broker.
Plaintiffs filed an appeal in the Fourth Circuit last March. In October, the Supreme Court decided to hear a similar case involving C.H. Robinson, putting Echo Global Logistics’ case on hold. With the Supreme Court ultimately ruling that brokers like Echo Global can be held liable, the Fourth Circuit vacated Judge Austin’s ruling and sent the case back under new Supreme Court precedent.
With Echo Global Logistics back in the defendant’s seat, the broker will have to face claims of negligently hiring an unsafe motor carrier.
However, the facts of this case differ from those in the C.H. Robinson case.
Plaintiffs must show that the brokers should have known that a motor carrier was unsafe. In the C.H. Robinson case, the carrier it hired had a “Conditional” safety rating and out-of-service rates twice the national average for both drivers and vehicles. In the Echo Global Logistics case, the publicly available information on the carrier was less egregious. LL
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