11th Circuit Rules Negligence Claim Against Broker Preempted, Creating Circuit Split

• Jurisdiction: United States,Federal
• Author: Mr Jameson B. Rice, William Byrne and Kristine Orozco Little
• Law Firm: Holland & Knight
• Published date: 10 May 2023

Freight brokers are often sued for negligence when there is cargo damage or personal injury involving a motor carrier hired by the broker. Personal injury claims in particular can involve damages in the tens and hundreds of millions of dollars, which represents a substantial risk for brokers. However, brokers often contend that these claims are preempted. The U.S. Court of Appeals for the Eleventh Circuit recently held in Aspen Amer. Ins. Co. v. Landstar Ranger, Inc., No. 22-10740 (11th Cir. April 13, 2022), that the Federal Aviation Administration Authorization Act (FAAA) preempts such negligence claims, reaching the opposite conclusion of the U.S. Court of Appeals for the Ninth Circuit.

In Aspen Amer., Landstar, the broker, engaged a carrier to haul a load for its shipper customer but was alleged to have dispatched the load to a fraudster who stole the goods. The shipper's insurance carrier brought a negligence claim against Landstar in the U.S. District Court for the Middle District of Florida. The Court held that the claim was preempted by the FAAA, which the Eleventh Circuit...