The Supreme Court, for the third time, has chosen not to take up the issue of broker liability, leaving the issue with conflicting precedents in the federal courts.
In a decision handed down Monday with no comment – which is traditional – the court denied review in the case of Gauthier vs. TQL.
In that case, Katia Gauthier, the widow of a man killed on a Georgia road in an accident with a truck hauling a load for the giant 3PL, filed suit against TQL. But both a lower federal court and an appeals court held that the Federal Aviation Administration Authorization Act (F4A) protected TQL.
Gauthier asked the Supreme Court to review the case. And in an unusual twist, so did TQL, even though it had been victorious two times.
In its request for certiorari, TQL said the 11th U.S. Circuit Court of Appeals was correct in its ruling protecting the 3PL. But with conflicting circuit decisions, TQL wrote in its request that “the question presented is one of considerable importance to the transportation industry. “
The lack of a clear standard, TQL wrote, “not only imposes significant costs on respondents and other freight brokers but also undermines Congress’s deregulatory objectives in enacting the FAAAA. Moreover, this case is a suitable vehicle to resolve the conflict on the question presented.”
Brokers have racked up a string of wins in recent years on the question of whether they can be held liable or negligent when a carrier they hire is involved in an accident or other incident. Landstar won (NASDAQ: LSTR) in an 11th Circuit case over stolen freight; C.H. Robinson recently prevailed in a 7th Circuit case involving an Illinois wreck in 2017; GlobalTranz won a case against the widow of a man killed by a carrier hired by the broker, also in the 7th Circuit.
The losing side in the GlobalTranz case, Ying Ye, sought certiorari; it was denied about a year ago.
The one recent case in which a brokerage lost on a question of being held responsible for an accident was Miller vs. C.H. Robinson (NASDAQ: CHRW). The broker was on the losing end of a decision in the 9th Circuit, holding that a provision in the F4A known as the safety exemption did not fully protect C.H. Robinson.
C.H. Robinson sought certiorari but it was denied in 2022.
The end result is that precedents in the 11th and 7th circuits favor brokers. But the Miller vs. Robinson decision does not, leading to the type of conflicting circuit decisions that often can be the basis for a Supreme Court review.
That did not happen here, leaving the brokerage industry to continue to ponder a fractured legal landscape.
“While one never knows for sure, the Court may have deemed that the circuit split is still too shallow and that one or more additional federal circuit courts need to chime in before SCOTUS will entertain review,” Marc Blubaugh, co-chair of the transportation & logistics practice group at the Benesch law firm, said in an email to FreightWaves. “At the very least, TQL should be commended for attempting to fight the good fight on behalf of the freight brokerage industry. In the meantime, the greater freight brokerage community will continue to operate in a world rife with uncertainty notwithstanding the very favorable trend that is evident from numerous recent court decisions.”
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