FAAAA PREEMPTION DECISION ALERT: KENTUCKY STATE COURT RULES THAT NEGLIGENT HIRING/SELECTION CLAIM AGAINST FREIGHT BROKER IS PREEMPTED BY THE FAAAA AND NOT SAVED BY THE “SAFETY EXCEPTION”

On February 29, 2024, the Commonwealth of Kentucky McCracken Circuit Court held that the plaintiff’s claim for negligent hiring/selection against Integrity Express Logistics, LLC (“Integrity Express”) was: 1) preempted by the 1994 Federal Aviation Administration Authorization Act (“FAAAA”) found in 49 U.S.C. § 14501(c)(1), and 2) not saved by the “safety exception” found in 49 U.S.C. § 14501(c)(2)(A).  See Fruge v. Integrity Express Logistics, LLC, No. 23-CI-00476 (Ky. Cir. Ct. Feb. 29, 2024).

In Fruge, the freight broker, Integrity Express Logistics, LLC (“Integrity Express”), hired/selected a motor carrier, Akal Cargo, Inc. (“Akal Cargo”), to transport a load. The plaintiff filed a lawsuit against numerous defendants, including Integrity Express, claiming it negligently hired/selected Akal Cargo and that Integrity Express was vicariously liable for the truck driver’s underlying negligence as a result of an accident that resulted in personal injuries to the plaintiff.

The Kentucky Circuit Court granted Integrity Express’s Motion for Judgment on the Pleadings finding that the “safety exception” to the FAAAA did not save plaintiff’s negligent hiring/selection claim against Integrity Express by primarily relying upon Ye v. GlobalTranz Enterprises, Inc., 74 F.4th 453 (7th Cir. 2023) and Aspen Am. Ins. Co. v. Landstar Ranger, Inc., 65 F.4th 1261 (11th Cir. 2023).

Importantly, the Kentucky Circuit Court also ruled, as a matter of law, that Integrity Express was serving as the broker of the subject load even though its name was on the bill of lading and it also had DOT authority to operate as a motor carrier, and that the plaintiff’s vicarious liability claim against Integrity Express should be dismissed because there were no allegations indicating Integrity Express exercised control over Akal Cargo so that an agency relationship was created.

We continue to recommend that freight brokers assert the FAAAA preemption defense early, file dispositive motions, and consider filing appeals where appropriate so that other state and federal appellate courts decide this issue, and the Supreme Court of the United States may be inclined to accept a writ of certiorari.