Reducing Vicarious Liability Risk in Asset-Based Brokerage Operations

Many asset-based motor carriers engage in transportation brokerage operations to either handle excess freight during peak demand periods or as supplemental revenue source to the motor carrier operations. If a truck driver operating one of the brokered loads causes a serious accident,  an injured person may attempt to hold not only the driver and motor carrier responsible, but also the broker that arranged the shipment.

For years, brokers could, with limited exceptions, rely on federal preemption arguments to defend against state tort claims arising from highway accidents involving the brokered loads. Following the 2026 Supreme Court’s landmark decision in Montgomery v. Caribe Transport II, LLC, companies brokering interstate shipments can no longer rely on federal preemption to avoid these state tort claims. A great deal of industry guidance and focus following the Montgomery decision has been on the importance for brokers to adopt and use reasonable carrier-selection protocols and procedures. While a carrier-selection protocol is important to defend against negligent selection claims, the recent Fifth Circuit Court of Appeals decision in Crane as next friend D. J. M. v. Penske Transportation Management, L.L.C. and $604 million state-court verdict against CH Robinson in Lipe v. Lupus Superior, LLC highlights the risk of vicariously liability claims to hold the broker liable for the negligent actions of the truck driver transporting the brokered load. This is especially a concern when the load was brokered by an entity that also conducts traditional asset-based motor carrier operations.

The absence of federal preemption protection and uptick of vicarious liability claims against transportation brokers makes it more important than ever for asset-based motor carriers that engage in brokerage to structure their operations carefully and establish procedures designed to minimize the risk of being held responsible for the conduct of an independent motor carrier or truck driver. The following are items an asset-based motor carrier should consider to address and minimize the risk of being exposed to vicarious liability claims arising from brokered loads.

• Analyze the corporate structure to make sure the asset-based motor carrier operations are as insulated as possible from liabilities arising from the transportation brokerage operations. Ideally, the motor carrier and brokerage operations should be conducted in separate legal entities.

  
  

• To the extent operationally practical, ensure the customer-facing contracts make clear the company is acting as a transportation broker on the brokered loads, and not a motor carrier. The broker entity should, if possible, have its own separate contract with the customer.

  
  

• The broker-carrier agreement should make clear the carrier is an independent contractor and, as such, has control over the carriers’ transportation services. For instance, the broker carrier agreement should clearly establish that:

• The carrier is an independent contractor.

• The carrier is responsible for hiring, training and supervising its drivers.

• The carrier controls the manner and means of transportation.

• The carrier is responsible for its vehicles and equipment.

• The carrier is responsible for complying with applicable federal and state trucking regulations.

• The carrier is responsible for driver qualifications and hours-of-service compliance.

• The broker does not employ or supervise the carrier’s drivers.

• The carrier maintains required insurance.

• The carrier remains responsible for its own safety program.

• Avoid, to the extent possible, directing the driver’s day-to-day activities. For example, a broker should be cautious about:

  
  

  • Directing the driver’s route or when or where to stop for rest;

  • Supervising the driver’s driving;

  • Setting the driver’s work schedule;

  • Disciplining the driver;

  • Communicating directly with the driver;

  • Providing equipment to the driver;

  • Making load-specific safety decisions;

  • Requiring the driver to wear a uniform; and

  • Limiting delivery instructions that are not tied directly to customer/shipper requirements. Requiring the driver to follow delivery instructions that are not passed on directly from the shipper.

    
    

A broker should focus on maintaining a genuine broker relationship with the customer and third-party motor carrier to protect the company from vicarious liability claims in highway accident cases. This can be done by properly structuring the company’s operations, maintaining favorable customer and carrier contracts and shipping documents specifying the company’s role as a transportation broker, and not exercising control over the carrier’s drivers and operations. The attorneys at Childress Law are here to help you navigate this evolving legal environment and make sure your brokerage operations are well situated to limit and defend against the risks posed by vicarious liability claims.