In a case involving the shipment of a Catamaran sailboat in interstate commerce from Rhode Island to California, a Federal district court judge held in part, state-law tort and statutory claims against brokers involved in the shipment were preempted by the FAA Authorization Act of 1994 (FAAAA) and thus could not be held liable in negligence for the hiring of whichever carrier was ultimately responsible for the total destruction of the trailered Catamaran consumed by fire of undetermined cause.[1]
Why Case is Significant
It is an example of continued federal preemption available to freight brokers to defend state-law claims asserted in cargo loss and damages cases post-Supreme Court’s Montgomery v. Caribe Transport, II, LLC decision, which held that a motor vehicle “safety exception” in FAAAA “save[d]” a claimant’s negligent hiring claim against a broker from FAAAA’s general preemption provision in a case involving personal injury resulting from a motor vehicle crash of a brokered load. Montgomery v. Caribe Transport, II, LLC, 146 S. Ct. 1199, 1205 (2026).
What the R. I. Court Held
Where the plaintiff alleged the load was brokered to carriers who were “untrustworthy,” not “competent to transport,” not “sufficiently insured,” and that they failed to care for the goods entrusted as bailees, such allegations go to the security of the goods entrusted to the motor carrier, not to whether the commercial motor vehicle was somehow operated in a manner which negligently endangered motor vehicle safety, and thus distinguishable from the holding in Montgomery. FAAAA’s “safety exception,” which Congress enacted to “save” from preemption the safety regulatory authority of a State with respect to motor vehicle safety was not implicated in this case and consequently plaintiff’s state-law tort and statutory claims, “at their core” involved the defendant brokers’ negligent hiring and are preempted by the FAAAA, just as the law was before the Montgomery decision was handed down.
Background
According to the court’s decision, the fire that broke out while the Catamaran remained unattended on the carrier’s trailer overnight, was a total loss, and observed its “final voyage had, quite literally, gone up in smoke.”
The insurer paid the sailboat’s owner approximately $1,000,000 for the loss and sought recovery in a subrogation action against the potentially responsible parties involved or alleged to be involved in the transportation. Like many interstate shipments involving goods in transit, the Rhode Island case involved, numerous so-called “transportation intermediaries” involved, or alleged to have been involved, and according to plaintiff, should be held liable to the aggrieved shipper or its subrogee for the loss.
Analysis
As mentioned, this decision comes on the heels of the Supreme Court’s momentous broker liability case called Montgomery v. Caribe Transport, II, LLC. The Montgomery decision is significant because the Court unanimously held that FAAAA’s “safety exception” “save[d]” a claimant’s negligent hiring claim against a broker from FAAAA’s general preemption provision in a case involving personal injury resulting from a motor vehicle crash allegedly caused by a trucking company that maintained an unsafe truck or hired or employed an at-fault driver.
In Montgomery, the injured plaintiff claimed because the FMCSA had assigned a Conditional safety rating to the motor carrier due to deficiencies in regulatory factors designed to evaluate the adequacy of the carrier’s safety management controls, which, because it would have been apparent at the time the broker hired the carrier, it knew or should have known the carrier had a subpar safety rating and thus was reasonably likely to result in crashes that would injure others.[2]
Applying the Restatement (Second) of Torts, § 411 duty of care that “[n]egligent hiring claims impose a duty of reasonable care in employing a contractor for work carrying a risk of physical harm,” the Supreme Court held brokers must exercise reasonable care in selecting a carrier. Such duty arises when a broker arranges transportation by motor truck because it “‘concerns’ motor vehicles – most obviously, the trucks that will transport the goods. So [the claimant’s] negligent-hiring claim falls within the FAAAA’s safety exception, which saves it from preemption.” Montgomery 146 S. Ct. at 1204, 1205.
The Rhode Island court, after reviewing Montgomery, concludes not all negligent hiring claims against brokers inherently fall within the FAAAA’s safety exception. It reads the Montgomery decision to answer the preemption question as “whether negligent-hiring claims of the type” the plaintiff in Montgomery presses – personal injury or death claims, are the “type” of claims “with respect to motor vehicles” not preempted by FAAAA. Unlike the negligence claim in Montgomery, the “type” of the plaintiff’s claims in the Rhode Island case against the brokers, based upon the factual allegations underpinning the claims, go to the security of the goods entrusted to the motor carrier, not to whether the commercial motor vehicle was somehow operated in a manner which negligently endangered motor vehicle safety and are thus preempted by the FAAAA. After requesting supplemental briefing, the court rejects plaintiff’s argument that the Catamaran fire may have posed a risk to other motorists because there were no allegations that the trailer carrying the boat was illegally or otherwise improperly parked in a way that negligently endangered motor vehicle safety, as opposed to the security of the Catamaran itself.
Takeaways
Certain brokers in this case were able to prevail on dismissal of the plaintiff’s state-law tort and statutory claims relating to the cargo loss because of FAAAA’s general preemption provision. To state the obvious, the public policy considerations concerning damage to goods in transit are different than the public policy concerning public liability for third-party personal injury. You have to ask yourself, who needs to be protected – the parties to the freight transaction or the public. The Supreme Court has answered that for the majority of personal injury cases: the safety exception for motor vehicles saving from preemption state-law claims sounding in tort for personal injuries applies in cases arising out of interstate transportation.
While the Rhode Island decision was a victory for some of the brokers involved, the Supreme Court’s application of the FAAAA’s safety exception saving from preemption state-law claims against freight brokers for their decision to hire a motor carriers and liability for such decisions is real and actionable for every brokered load. For now, broker-liability for their hiring decisions are virtually certain to go to trial where the claim involves a personal injury to a member of the public involving the commercial motor vehicle. For now, the broker must be able to mount a defense using evidence that it exercised “reasonable care” imposed by a given state in the selection decision to broker the load to the carrier, and be prepared to defend that decision at trial.
Dated: Sudbury, MA
August 29, 2026
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[1] S.A.M. Pantaenius Monaco v. Save On Transport Enterprises, LLC, 25-00140-MRD-PAS Memorandum and Order (D. R.I. Aug. 14, 2026). The Rhode Island Division of State Fire Marshal who inspected the cause of the fire “was unable to determine whether it was caused by the [boat’s] lithium batteries or by ‘open flame.’” Id. at 3.
[2] Plaintiff in Montgomery claimed that FMCSA “had allegedly found [the motor carrier] to be deficient ‘with respect to qualification of drivers,’ ‘hours of service of driver,’ ‘inspection, repair and maintenance,’ recordable crash rate,’ and more.” Id. at 1204. FMCSA, through “Safety Fitness Procedures” used to examine a carrier’s records and equipment following compliance reviews a/k/a compliance investigations and roadside inspections, will score the carrier using a “safety fitness methodology” to assign one of three safety ratings to a motor carrier: Satisfactory, Conditional or Unsatisfactory. See generally 49 CFR part 385, Appendix B – Explanation of the Safety Rating Process. While not discussed in the Supreme Court’s decision in Montgomery, by definition a motor carrier assigned a “Conditional” safety rating means, that the motor carrier does not have adequate safety management controls in place to ensure compliance with the safety fitness standards that could result in violations of the Federal safety and hazardous materials regulations, including critically, motor vehicle accidents.