By Gallagher Sharp LLPOn January 3, 2025, the Seventh Circuit Court of Appeals held that a plaintiff’s claim for negligent hiring/selection against a freight broker was: 1) preempted by the 1994 Federal Aviation Administration Authorization Act (“FAAAA”) found in 49 U.S.C. § 14501(c), and 2) not saved by the “safety exception” found in 49 U.S.C. § 14501(c). See Montgomery v. Caribe Transport II, LLC, 7th Cir. No. 24-1192 (Jan. 3, 2025). The Seventh Circuit also affirmed the district court’s decision granting the freight broker judgment on plaintiff’s agency claim. Id.
In Montgomery, the freight broker, C.H. Robinson Company, C.H. Robinson Company, Inc., C.H. Robinson International, Inc. and C.H. Robinson Worldwide, Inc. (“C.H. Robinson”), hired/selected a motor carrier, Caribe Transport II, LLC (“Caribe”), to transport a load. The plaintiff filed a lawsuit against numerous defendants, including C.H. Robinson, claiming it negligently hired/selected Caribe and that C.H. Robinson was vicariously liable for the truck driver’s underlying negligence pursuant to agency principles.
The Southern District of Illinois initially denied C.H. Robinson’s Motion to Dismiss finding that the “safety exception” to the FAAAA saved plaintiff’s negligent hiring/selection claim against C.H. Robinson by relying upon Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1020 (9th Cir. 2020). C.H. Robinson subsequently filed a Motion for Judgment on the Pleadings following the Seventh Circuit Court of Appeals’ decision in Ye v. GlobalTranz Enterprises, Inc., 74 F.4th 453 (7th Cir. 2023), and on January 11, 2024, the Southern District granted C.H. Robinson judgment on the pleadings given that Ye is now “the settled law of [the Seventh Circuit].”
The Southern District did not address plaintiff’s vicarious liability claim because it previously granted C.H. Robinson summary judgment on this issue.
The plaintiff appealed the Southern District’s decisions and the Seventh Circuit affirmed both decisions finding that: 1) the norm in Illinois is that motor carriers and their drivers are independent contractors of freight brokers and nothing in this case was outside the norm so as to create an agency relationship (citing Cornejo v. Dakota Lines, Inc., 229 N.E.3d 546, 556 (Ill. App. Ct. 2023)), and 2) plaintiff’s claim for negligent hiring/selection was indeed preempted by the FAAAA and not saved by the “safety exception by again relying upon Ye.
Of note, the Seventh Circuit held “’We do not take lightly suggestions to overrule circuit precedent,’ and therefore ‘require a compelling reason to do so.’” Int’l Union of Operating Eng’rs Loc. 139 v. Schimel, 863 F.3d 674, 677 (7th Cir. 2017) (quotations omitted). Montgomery points only to pre-Ye or out-of-circuit decisions and a statement by the Solicitor General for support. These are not compelling reasons to revisit a case we decided only one year ago.” We are hopeful the Supreme Court of the United States will agree to accept the Writ of Certiorari requesting review of the Eleventh Circuit Court of Appeals’ decision to affirm the granting of summary judgment in favor of broker, Total Quality Logistics, LLC, so that practitioners have a clear understanding of the application of FAAAA preemption. See Gauther v. Total Quality Logistics, LLC, Docket No. 24-592.