Transportation & Logistics Initial Thoughts & FAQs on SCOTUS Ruling That Redefines Truckload Brokerage Liability, CHRW to AFL

Research evidence excerpt

Transportation & Logistics Initial Thoughts & FAQs on SCOTUS Ruling That Redefines Truckload Brokerage Liability, CHRW to AFL

construct and document a vetting process that can withstand legal

scrutiny. Trailer pools would also pose the same level of potential negligent hiring risk

given these power-only drivers are often from third parties.

• Will this really have an impact on truckload capacity? We believe the ruling will cause

shippers to favor larger, asset-based carriers and scaled brokers, as there is now one less

party between them and potential lawsuits when freight moves through a broker. Some

shippers have already begun limiting bids to asset-based carriers or capping broker

participation, and we expect this preference to intensify following this decision. On the

vetting side, smaller carriers are inherently more difficult to qualify given that over 95%

lack a formal safety rating from the FMCSA, publicly available safety data remains

limited and inconsistent, many have not been inspected in over 24 months, and brokers

typically cannot access individual driver files which sit with the motor carrier. This

creates a real administrative challenge for smaller carriers that will likely be required to

submit documentation on a more frequent basis. In addition, we expect there will be an

increasing number of risk-averse brokers building selection processes that are robust but

do not trip the control test that could expose the carrier to vicarious liability claims.

• How much do brokers pay for insurance now and how much will this change? The

percentage of revenue truckload brokers pay for insurance and claims varies widely and

is not consistently disclosed, but we estimate large brokers like C.H. Robinson are close