United States District Court For The Northern District Of Ohio Again Finds That Plaintiff’s Bodily Injury Tort Claims Against A Freight Broker Are Preempted By The FAAAA And Not Saved By The “Safety Exception”

On January 10, 2023, Judge James R. Knepp II of the United States District Court for the Northern District of Ohio again ruled that a plaintiff’s claims for vicarious liability and negligent selection are: 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 McCarter v. Ziyar Express, Inc., N.D. Ohio No. 3:21 CV 2390, ECF Doc. No. 53 (Jan. 10, 2023).

This is another win for freight brokers in Ohio as the Northern District of Ohio recently reached the same conclusion in Lee v. Werner Enterprises, Inc., N.D. Ohio No. 3:22 CV 91, ECF Doc. No. 48 (Nov. 3, 2022). But, Judge Knepp’s decision in McCarter is the first time any Ohio federal district court has held that, because a freight broker’s claims are preempted by the FAAAA and not saved by the “safety exception,” similar claims asserted against “upstream” defendants, such as subsidiaries, sister companies, and shareholders of a broker, should also be dismissed. In McCarter, Judge Knepp adopted his reasoning in Lee and held that the FAAAA should be read broadly, and when read broadly, it is clear that plaintiff’s claims were related to the freight broker’s “services” so that preemption applies pursuant to 49 U.S.C. § 14501(c)(1).

Judge Knepp also disagreed with the McCarter plaintiff’s argument that, even if her claims fell within the preemption provision, they were nonetheless protected and saved by the “safety exception,” which provides that the FAAAA “shall not restrict the safety regulatory authority of a State with respect to motor vehicles.” In reaching this decision, Judge Knepp rejected the Ninth Circuit’s reasoning in Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1020 (9th Cir. 2020) that “the safety regulatory of a state” encompasses plaintiff’s state law tort claims and that such negligence claims “stem from motor vehicle accidents” so that they “are with respect to motor vehicles.” Judge Knepp held that:

“…if the safety exception preserved all claims related to motor vehicles, as urged by Plaintiffs and Miller, “all preempted claims would then be ‘saved’by the exception.” Creagan, 354 F. Supp. 3d at 814. This would make the entirety of the preemption provision redundant. Rather, this Court finds “it cannot ignore the straightforward preemption analysis as laid out by the Supreme Court, and finds instructive the analysis in Rowe.” Volkova v. C.H. Robinson Co., 2018 WL 741441, at *4 (N.D. Ill.). To the eye of this Court, the FAAAA’s preemption provision protects precisely parties such as the shipper and broker, who did not have direct involvement in the accident that injured Plaintiffs.

Judge Knepp also held that, if tort claims against a freight broker are preempted by the FAAAA and not saved by the “safety exception,” then claims for vicarious liability and negligent selection against “upstream” defendants of a broker should also be dismissed.

The ruling in McCarter is certainly more positive news for the freight broker industry, though we would not be surprised if the plaintiffs in both McCarter and Lee appeal these decisions to the United States Court of Appeals for the Sixth Circuit. If the Sixth Circuit affirms Judge Knepp’s decision in McCarter or Lee, this could provide the circuit court split needed for the Supreme Court of the United States to review this issue.

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