Good morning.

Editor at large John Kingston and Washington bureau chief John Gallagher will be following the oral arguments before the U.S. Supreme Court Wednesday in Montgomery vs. Caribe, the case that is expected to settle an almost existential question in freight brokerage: does the safety exception of the Federal Aviation Administration Authorization Act (F4A), which allows state safety regulation of transportation safety while the rest of F4A mostly bars state involvement, allow legal actions against brokers for negligence or liability arising from the carriers they hire?

The key phrase that is likely to be discussed before SCOTUS is “with respect to motor vehicles.” The safety exception says its application is “with respect to motor vehicles.” Circuits have split on whether that definition includes the 3PLs that hired that motor vehicle. That’s why after earlier rejections of certiorari on other F4A jurisdiction cases the high court decided to review this case which involves a driver, Shawn Montgomery, struck by another truck operated by Caribe Transport and hired by C.H. Robinson (NASDAQ: CHRW).

C.H. Robinson was originally a defendant in the case. But a lower court and then the 7th Circuit dismissed it from the case, saying the company was protected by the F4A, which decrees that states can not take legal action that would impact a “price, route or service” in transportation. The exception would be for a safety issue, and in the Montgomery case, the courts held the safety exception is “with respect to motor vehicles” and a 3PL isn’t a motor vehicle. 

But other cases have disagreed. In particular, the buildup of conflicting opinions already included another case where C.H. Robinson lost its argument, Miller vs. C.H. Robinson in the 9th Circuit. More recently, the safety exception was held to not protect brokers in Cox vs. TQL, coming out of the 6th Circuit. TQL last year lost that case and also requested certiorari. The Court did not rule on that request, presumably awaiting what it says in Montgomery before disposing of Cox.  

C.H. Robinson’s arguments are expected to be made by Warren Dean or Kathleen Kraft of the law firm of Thompson Coburn. 

The Trump administration’s solicitor general D. John Sauer has been granted 10 minutes of C.H. Robinson’s 30-minute oral argument allotment to argue in favor of the brokerage industry’s case. 

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