After the Supreme Court’s ruling on broker liability, the fate of the future of broker-carrier relationships hinged on how juries would decide on subsequent cases. A new nuclear verdict just dropped on C.H. Robinson, and the facts don’t bode well for the industry.
On July 23, a jury in Dallas County, Texas, reached an eye-popping verdict totaling more than $600 million in a personal injury case involving C.H. Robinson and a carrier it hired. That marks one of the largest nuclear verdicts in a truck crash case and the first major case against a broker to be decided after the landmark Supreme Court case known simply as Montgomery.
The big question on everyone’s mind after Montgomery was how broker liability would affect how brokers choose carriers. C.H. Robinson tightened its standards, including no longer working with carriers that have a “Conditional” safety rating.
Who ultimately determines how much “due diligence” a broker must perform are 12 men and women on a jury applying the new broker liability standard. If the Dallas County case sets the precedent, it could spell trouble.
In this case, C.H. Robinson hired the carrier Lupus Superior in March 2021 to haul a load in a standard broker-carrier transaction. The driver was involved in a fatal multi-vehicle crash that began with another truck crash that caused a chain reaction.
Publicly available information indicated that Lupus Superior was a safe carrier.
According to safety records retrieved in August 2023, Lupus Superior’s driver and vehicle out-of-service rates were 3.8% and 21%, respectively, both below the national average. Even more relevant is the fact that the carrier had a Satisfactory safety rating.
Additionally, C.H. Robinson pointed out in a statement that the carrier “had safely delivered nearly 270 loads” for its customers when it was selected for the job at the center of the lawsuit.
While the jury found that C.H. Robinson’s negligence proximately caused the occurrence in question, it also answered “No” to the question “Did the negligence, if any, of C.H. Robinson in undertaking responsibilities of motor carrier proximately cause the occurrence in question?”
However, the jury also found that the driver of the Lupus Superior truck was a “borrowed employee of C.H. Robinson.” That is what ultimately kept the broker on the hook despite C.H. Robinson working only with independent contractors.
“The carrier is an independent motor carrier, and the driver worked for them. C.H. Robinson does not employ drivers,” C.H. Robinson said in a statement.
While the verdict is massive, the jury found that C.H. Robinson was only 23% responsible for the crash. Lupus Superior was found 32% responsible, and the driver got the lion’s share at 45%.
C.H. Robinson said it strongly disagrees with the verdict and will immediately appeal. In the meantime, the case raises a fresh set of questions about broker liability in a post-Montgomery world. That includes the value of safety ratings and the employment status of independent contractors and owner-operators. LL
This is a developing story. Check LandLine.Media for updates.
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