Montgomery v. C.H. Robinson: What Freight Brokers Should Do Next

The Supreme Court's decision in Montgomery v. C.H. Robinson has freight brokers rethinking how they vet the carriers they hire. Here's what the ruling actually means, and the practical steps brokers should be taking as the legal landscape continues to evolve, because carrier vetting isn't just an operational function now but a risk management function too.

Executive Summary

The Montgomery decision does not establish new federal insurance requirements for freight brokers. It does, however, reinforce the importance of demonstrating a reasonable, documented carrier selection process.

Key themes:

1. Courts will continue defining reasonable carrier vetting.

2. Maintain documented qualification standards.

3. Technology supports, but does not replace, your vetting process.

4. Shippers may also face increased scrutiny.

5. Review insurance programs for today's liability environment.

Five Immediate Actions for Freight Brokers

1. Document your carrier vetting standards. Document minimum insurance requirements, safety thresholds, required documentation, alert response procedures, and exception approval processes.

2. Review your carrier database. Review "Do Not Use" lists and ensure exclusion decisions align with documented standards.

3. Technology supports the process — it doesn't replace it. Platforms such as Highway and CAB are valuable tools, but the broker remains responsible for establishing and applying carrier qualification standards.

4. Review broker-carrier agreements. Consider requiring carriers to report significant safety changes, notify brokers of material issues, and correct inaccurate public information.

5. Review your insurance program. Review Truck Broker Liability coverage, General Liability, Contingent Cargo, defense provisions, and all coverage limits.

Frequently Asked Questions

Broker Liability

Will insurance requirements increase? No statutory insurance requirements were created. However, many shippers are expected to require higher liability limits.

Will courts establish clearer negligent selection standards? Yes. Future case law will likely continue defining minimum carrier vetting expectations.

Does Professional E&O protect brokers? Truck Broker Liability coverage is generally the more appropriate coverage because many Professional E&O policies exclude bodily injury and property damage claims.

Do broker-to-broker agreements help? Intentional co-broker relationships may reduce exposure, while unauthorized double brokering can still create significant liability.

Carrier Vetting

Are Highway and CAB enough? Technology platforms execute the broker's standards but do not replace the broker's responsibility for carrier selection.

Should brokers maintain written standards? Yes. Written carrier qualification standards help demonstrate consistency.

How should brokers approach new carriers? Develop consistent standards for evaluating newer carriers lacking extensive safety history.

Shipper Liability

Does this decision affect shippers? Potentially. Shippers selecting carriers primarily on price or knowingly using inadequate vetting practices could face increased scrutiny.

Can liability extend beyond brokers? Generally, brokers remain the primary focus, although shipper involvement in carrier selection may increase exposure.

Our Perspective

The Montgomery decision reinforces the importance of aligning operations, contracts, technology, and insurance. Cottingham & Butler helps freight brokers evaluate carrier qualification standards, broker-carrier agreements, COI verification procedures, safety monitoring practices, and Truck Broker Liability coverage to build a more defensible carrier vetting process.

Final Thoughts

The legal standards surrounding negligent carrier selection will continue to evolve. Brokers can strengthen their position by implementing a documented, consistently applied carrier vetting process supported by appropriate insurance and operational controls.

Ask your Cottingham & Butler representative about a Freight Broker Scorecard — a side-by-side look at how your vetting standards, agreements, and coverage compare to industry best practices.

Take our Freight Broker Assessment to see how your program measures up.