CAB BITS & PIECES June 2022 - Central Analysis Bureau

We hope you enjoyed your Independence Day holiday!

We hope your Independence Day holiday was filled with joy and quality time with family and friends.

As many of you have likely noticed, our Bits & Pieces has been delivered a few days later than normal. In order to ensure our newsletter does not get lost over weekends or holidays, we’re adjusting our delivery points. Do not worry, we will still be providing the great content and resources you’ve come to expect over the years.

Have a great July!

CAB Live Training Sessions

We will be taking the month of July off from our live training sessions. Keep in mind, all our great training content is still available via our webinar page by clicking here.

Below is a peek at our live training sessions that will take place in August.

Tuesday, August 9th @ 12p EST: Mike Sevret will present on one of CAB’s most valuable tools, CAB List. Learn how to best use CAB List to monitor your book of business. Set up triggered alerts, analyze the health of your motor carriers, and more! Attendees will learn how to monitor CAB-BASIC Scores, ISS-CAB Values, crashes, violations, safety rating, filings and others. Do not miss out on this opportunity to learn about this powerful CAB feature. Click here to register.

Tuesday, August 16th @ 12p EST: Learn how to grow your business with SALEs Targeted Leads. The CAB team will teach you how to target companies within your specific appetite with over 100+ filters. Search by insurance renewals, fleet size, commodities, and many other options. This is a great session for newer and experienced users. Click here to register.

You can explore all of our previously recorded live webinar sessions by visiting our webinar library.

CAB’s Tips & Tricks: Learn More About Chameleon Carriers.

For those of us that follow trucking news and events, you may have noticed there was a company named Jaypur Logistics LLC that was placed out of Service of May 7^th. The article details the numerous violations that lead to the Out of Service order. Certainly a company that had numerous issues that should have been addressed based on the “egregiously noncompliant” label given by authorities. This motor carrier was identified as a Chameleon Carrier in CAB’s Carrier Central and was linked to JPL Logistics LLC. We encourage our users to pay attention and learn all they can about chameleon carriers and associated alerts in the CAB system.

It is always good to pay attention to Out of Service orders as like in this case, Jaypur Logistics LLC started moving their operations to JPL Logistics LLC. The FMCSA became aware of this immediately took action to put JPL Logistics LLC out of service as well.

As noted in the Land Line article’s Editor’s note: A related company – Houston-based JPL Logistics LLC, U.S. DOT No. 3466122 – was declared an imminent hazard by the Federal Motor Carrier Safety Administration on May 31. FMCSA determined that it began operating so that Jaypur Logistics LLC, U.S. DOT No. 3150073, could avoid the imminent hazard order issued to it on May 7.

For more information on chameleon carriers and interrelated entities, please click here to review our 30-minute recorded webinar that took place on June 14, 2022. This webinar covers the concept of a chameleon carrier, interrelated entities and the features CAB provides to identify and understand the relationships that may exist between motor carriers.

Don’t forget to reach out to learn more about CAB’s new Express Report. The Express Report trial was very popular, and many organizations have already added the CAB Express Report to their current service.

The concise summary provided by the CAB Express report perfectly complements the in-depth analysis of the full CAB Report® to provide the best set of tools needed for the risk selection process.

The CAB Express Report can be added to your annual service immediately. To learn about pricing, please reach out to your CAB Representative at 212.244.6575 or via “Contact Us” link which is available in the “My Account” tab within your CAB access.

THIS MONTH WE REPORT:

Rising costs impact supply chain ability to get back in sync: The new 2022 State of Logistics Report is out, and notes residual effects of the pandemic are still negatively impacting the supply chain. Rising costs, increased e-commerce demand, and increasing challenges from last-mile delivery continue to drag down recovery. Read more

A ‘Great Purge’ is pushing small truckers out: Data shows that 2020-2022 brought an increase in owner-operators to serve demand during the Covid years. Of the 195,000 new carriers entering the market, about 70% were just one truck. Now, many of these small truckers are shutting down their companies. Read more

FMCSA rules against Houston company: No, you can’t just rename your company and start running that same fleet once it was deemed an “imminent hazard”. That’s what Houston trucking fleet owners and management learned the hard way from a recent FMCSA ruling after they re-started their shuttered company under a different name. Get the details behind the Jaypur Logistics story mentioned earlier in the newsletter. Read more

Robin Hutcheson FMCSA nomination progresses: “In the 25 years I have worked in the transportation industry, safety has always been at the core of my work.” Robin Hutcheson’s nomination to serve as Administrator of the Federal Motor Carrier Safety Association has been approved by the Senate Committee on Commerce, Science, and Transportation. The nomination will go to the full Senate for a vote. Here are a few articles on her confirmation hearing.

ATA Truck Tonnage Index Rose 0.5% in May: Economic indicators that are important to trucking slowed in May, according to ATA Chief Economist Bob Costelo. Read more

Truck Safety in the News:

Read more in these two stories.

Injury lawsuit verdicts become increasingly unpredictable: With average litigation-related payments rising, a partner at a nationwide transportation law firm says juries are awarding more and larger awards than ever before. Steve Stanaszak discusses the impact of these cases on trucking companies. Read more

Mongoose v. Reptile: Legal experts fight back for truckers when plaintiffs use the reptile theory to create emotional responses in jury trials. Several trucking associations are holding training sessions on the approach they call “the mongoose method” to help motor carriers protect themselves during lawsuits “The litigation psychology is the biggest element of the mongoose method,” according to John Esparza, president of the Texas Trucking Association. Read more

Biden Administration Prepares Trucking Workforce Programs Focusing on Women, Younger Drivers: The Infrastructure Investment and Jobs act passed last November has provisions for addressing the lack or women and younger drivers. The Women of Trucking Advisory board will be launched later this year, with a goal of identifying barriers to women entering and staying in the driving profession. Read more

Defining a Freight Broker: The FMCSA is seeking public comment on revised definitions of brokers and agents. Federal regulations have different definitions of brokers in different sections, causing confusion and legal issues, especially when the responsibilities of truck brokers and freight dispatchers overlap. FMCSA is asking the public for responses to a series of questions to help guide them in creating new definitions. Read more

June 2022 CAB Case Summaries
These case summaries are prepared by Robert “Rocky” C. Rogers, a Partner at Moseley Marcinack Law Group LLP.

AUTO

Shepp v. Custom Cartage, Inc., 2022 U.S. Dist. LEXIS 94137, C.A. No. 1:20-cv-02722 (N.D.Ga. May 25, 2022). A motor carrier’s motion for summary judgment on negligent hiring, training, and supervision causes of action was denied, with the court finding a jury question existed. The evidence established the driver had two traffic offenses within the three years before he was hired, including a failure to obey a traffic control signal or device, and another speeding ticket in the three months he had been on the job for the motor carrier. The motor carrier’s own policies provided for suspension of the driver following the on-the-job traffic citation, but that did not occur. The court found there was a jury question on the reasonableness of the motor carrier in hiring the driver and retaining/not suspending him, as required by its own internal policies. The court did grant summary judgment to the driver and the insurer sued under Georgia’s direct-action statute for the punitive damages claim but denied the motion as to the motor carrier because the motor carrier did not raise the issue until its Reply brief.

Brown v. White, 2022 U.S. Dist. LEXIS 93629, C.A. No. 21-1387 (E.D. Pa. May 25, 2022). A commercial bus operator’s motion for summary judgment on punitive damages was denied where the evidence, viewed most reasonably to the plaintiff, could establish the operator was talking on his cell phone at the time of the accident. While Pennsylvania typically does not permit cell phone usage alone to permit imposition of punitive damages, the court found various aggravating factors existed, including: (1) the operator was operating a large bus with 22 passengers on board at night; (2) he was driving as fast as the bus would allow; (3) he was driving with only one hand on the wheel; and (4) he never applied the brakes prior to the accident.

Acuna v. Covenant Transp., Inc., 2022 U.S. Dist. LEXIS 97413, C.A. No. SA-20-CV-01102 (W.D. Tex. May 4, 2022). Leasing company of tractor and/or trailer involved in a motor vehicle accident was denied summary judgment on vicarious liability claims against it where the defendants had collectively, in pleadings and discovery in the case, represented that the leasing company was the same entity as the motor carrier/employer, registration records listed the leasing company, not the motor carrier, as the registrant/lessee, and trip checklists and repair invoicing in the name of the leasing company reflected the motor carrier and the leasing company as the same entity.

Lynch v. Collins, 2022 U.S. Dist. LEXIS 106700, C.A. No. 20 C 02477 (N.D. Ill. June 15, 2022). A lessor of trailer involved in a tractor-trailer accident was entitled to summary judgment in its favor. The lessor argued it lacked any control over the driver’s operation on the trailer and therefore there was no basis upon which to hold it vicariously liable for the driver’s negligence.

Hebert v. Hallmark Cnty. Mut. Ins. Co., 2022 U.S. Dist. LEXIS 96930, C.A. No. 20-2774 (E.D. La. May 31, 2022). Motor carrier and commercial insurer sued under Louisiana’s direct action statute were granted summary judgment on negligent entrustment and other direct negligence causes of action where they admitted the negligence of the driver and that the motor carrier was vicariously liable for his negligence.

Fox v. Nu Line Transp., LLC, 2022 U.S. App. LEXIS 16709, C.A. No. 20-30716 (5th Cir. June 16, 2022). The Fifth Circuit Court of Appeals, finding no binding Louisiana authority on point, certified to the Louisiana Supreme Court the question of whether a tort plaintiff can simultaneously maintain a claim of direct negligence against an employer for negligent hiring, training, and supervision of an employee and a respondeat superior claim against the employer, where the employer has stipulated the employee was in the course and scope of employment at the time of the accident. We will continue to monitor and report the Louisiana Supreme Court decision once issued.

Jackson v. Trendafilov, 2022 U.S. Dist. LEXIS 95532, C.A. No. No. 19-cv-02886 (W.D. Tenn. May 27, 2022). A motor carrier’s motion for partial summary judgment on all direct negligence causes of action (negligent hiring, training, entrustment, and retention of Trendafilov, and for failing to meet its duties and responsibilities under the Federal Motor Carrier Safety Regulations, Tennessee law, and industry standards) was granted where motor carrier admitted vicarious liability for the negligence of its independent contractor driver.

Hill v. Nationwide Fire Mut. Ins. Co., 2022 Mich. App. LEXIS 3067, C.A. No. 355602 (Mich. Ct. App. May 26, 2022). The Court of Appeals of Michigan reversed a trial court’s denial of summary judgment in favor of a motor carrier and an operator of a commercial motor vehicle involved in an accident during snowy/icy conditions. The tort plaintiff was traveling above the posted speed limit during admittedly icy conditions and lost control of his vehicle leading to the accident, whereas the CMV operator was operating below the speed limit and applied his brakes as soon as he observed the tort plaintiff’s vehicle lose control and begin to spin. Likewise, the court explained any negligence attributable to the CMV operator would be excused by the sudden emergency doctrine.

Hunter v. Matheson-Tri-Gas, Inc., 2022 U.S. Dist. LEXIS 105753, C.A. No. 21-0062 (S.D. Ala. June 14, 2022). A tractor-trailer driver and his alleged employer were entitled to partial summary judgment in a case stemming from an accident caused after one of the steer tires blew out following which the tractor-trailer left its lane of travel and forced the plaintiff’s car off the road allegedly leading to personal injuries to the plaintiff. The court notes the stipulated facts acknowledged the cause of the blowout was unknown and accordingly the plaintiff had failed his burden to establish the blowout was caused by any negligence of either the driver or the company, so both defendants were entitled to summary judgment on claims predicated upon that negligence. However, for the remaining claims alleging the driver acted negligently in failing to keep his tractor-trailer in the lane of travel following the blowout, the court found that presented a jury question. The court specifically held the application of the sudden emergency doctrine rarely results in summary judgment. Because the employer’s basis for summary judgment was only that its alleged employee was not negligent and therefore there was no basis for vicarious liability, since the court held there was a jury question on the driver’s negligence after the blowout the motor carrier’s motion for summary judgment was denied.

Hamrick v. James, 2022 U.S. Dist. LEXIS 99887, C.A. No. 3:20-cv-417 (E.D. Tenn. Apr. 22, 2022). A tractor-trailer driver and his motor carrier employer were entitled to summary judgment on all counts. The driver had pulled his tractor-trailer completely into the emergency lane and engaged his flashers after experiencing a bout of nausea that caused him to believe he was going to throw up. The driver did not exit the vehicle to put out triangles, as was required under state law. Another tractor-trailer, drifted from the lane of travel into the emergency lane and struck the stationary tractor-trailer before striking yet another tractor-trailer causing both to jacknife. The driver of the second tractor-trailer filed suit against the driver of the first. The driver of the first tractor-trailer moved for and was granted summary judgment, with the court finding it was not foreseeable that someone would cross into the emergency lane, even though the accident occurred at night. Insofar as the court held the first driver’s negligence was not a proximate cause of the accident, the direct negligence actions against the motor carrier were also dismissed.

Marr v. Croxton, 2022 U.S. Dist. LEXIS 106904, C.A. No. SA-21-CV-000961 (W.D. Tex. June 14, 2022). Lessor of a box truck was granted summary judgment under the Graves Amendment in a personal injury case arising from a motor vehicle accident. The court found there was no negligence the lessor failed to properly maintain the vehicle and/or that any failure to maintain was a proximate cause of the accident. The court also rejected the lessor had any obligation to ensure the lessee complied with FMCSRs. Last, the court rejected that the lessor was the statutory employer of the driver under the FMCSRs.

Hanan v. Crete Carrier Corp., 2022 U.S. App. LEXIS 16895, C.A. No. 21-10831 (5th Cir. June 17, 2022). The Fifth Circuit Court of Appeals affirmed the trial court’s exclusion of a post-accident “Warning Notice” issued to the driver following the accident based upon the carrier’s determination that the accident was “preventable” and which required the driver to undergo additional training on defensive driving. The trial court excluded evidence of the Warning Notice under FRE 403 (prejudice outweighs relevance) and FRE 407 (subsequent remedial measure). The court specifically noted the preventability and negligence standards differed and allowing the notice into evidence risked the jury would confuse the two standards with respect to culpability for the accident.

BROKER

Total Quality Logistics, LLC v. Tucker, Albin and Assocs., 2022-Ohio-1802, C.A. No. CA2021-06-031 (Ohio Ct. App. May 31, 2022). The denial of a freight broker’s motion for permanent injunction against a factoring/collection company was affirmed on appeal. The freight broker entered into a broker-carrier agreement with the motor carrier that provided the motor carrier could only seek payment from the broker unless the broker consents in writing. After delivery of load, a dispute arose between the broker and the motor carrier regarding payment. The motor carrier sold its account receivables to a factoring company, who then attempted to collect the freight charges directly from the broker’s customer. The broker thereafter filed suit against the collections/factoring company, alleging amongst other causes of action for tortious interference with contract and/or business relationships and sought a permanent injunction against the attempts to collect on the disputed freight charges. The trial court granted summary judgment to the collections/factoring company. On appeal, the appellate court affirmed the trial court’s rulings denying the injunction and tortious interference claims. It found the broker failed to establish it faced the risk of immediate and irreparable injury or harm and therefore injunctive relief was not appropriate. It also found the broker failed to allege the collections/factoring company induced or otherwise purposely caused a third person not to enter or to continue a business relation or not to perform a contract with the broker. However, the court did find for the broker on its breach of contract cause of action and held it was entitled to nominal damages.

Coyote Logistics, LLC v. Bajan Enter., 2022 U.S. Dist. LEXIS 102271, C.A. No. 21-cv-6154 (N.D. Ill. June 8, 2022). A motor carrier’s motion to dismiss a freight broker’s breach of contract cause of action under the broker-carrier agreement was denied. The motor carrier was involved in an accident, resulting in total loss of cargo. The shipper deducted the loss from payments owed to the freight broker (presumably as provided for under the shipper-broker contract). The freight broker, in turn, filed suit against the motor carrier alleging a Carmack count and a count for breach of the broker-carrier agreement, which provided for indemnification in favor of the freight broker. The court found the at-issue indemnification provision was compliant with Illinois’ anti-indemnification statute applicable to “motor carrier transportation contracts” because it did not seek to indemnify the freight broker for its own negligence. The court did find one provision of the broker-carrier agreement violated the statute, but the court read that provision out of the agreement by virtue of the severability provision in the agreement.

Coyote Logistics, LLC v. Advance Trucking Sols., Inc., 2022 U.S. Dist. LEXIS 102270, C.A. No. 21 C 4789 (N.D. Ill. June 8, 2022). A freight broker’s Carmack lawsuit against a subcontracted motor carrier was dismissed for lack of personal jurisdiction. The Illinois-based freight broker contracted with a Canada-based motor carrier to transport a shipment of pharmaceuticals from Canada to Texas. Without authorization or consent, the motor carrier subcontracted or double-brokered the load to another Canada-based motor carrier, who in turn subcontracted or triple-brokered the load to yet another Canada-based motor carrier. The court ruled under these facts, the Illinois court lacked personal jurisdiction—both general and specific—over the second motor carrier. With respect to the lack of specific personal jurisdiction, the court noted there was no direct connection or contracting between the freight broker and the second motor carrier.

COVERAGE

United Fin. Cas. Co. v. Mid State Logistics, 2022 U.S. Dist. LEXIS 104532, C.A. No. 4:21-cv-00177. A commercial auto liability insurer was granted summary judgment in its insurance coverage declaratory judgment action. One of two team drivers for the motor carrier was injured while sleeping in the sleeper berth when the other team driver lost control of the tractor-trailer and it overturned. The injured driver filed suit against the other driver and the motor carrier. The insurer moved for summary judgment, alleging various employee exclusions in the insurance policy excluded the claims from coverage. The court applied 49 C.F.R. § 390.5 to supply the applicable definition of employee, finding that the injured driver qualified as an employee even though he was not driving at the time of the accident.

Anderson v. Motorist Mut. Ins. Co., 2022 U.S. Dist. LEXIS 110116, C.A. No. 2:21-cv-00493 (W.D. Pa. June 22, 2022). A personal lines UIM carrier was held to be entitled to a credit against UIM liability totaling the amount of liability insurance available from other parties involved in the underlying accident. The decedent was a passenger in a personal auto with $100,000 in liability limits. The other vehicle was a CMV with $1,000,000 in primary coverage with $4,000,000 in excess/umbrella coverage. The decedent’s estate settled with the tortfeasors in exchange for the $100,000 in liability limits available under the personal auto liability policy, but only $550,000 of combined $4,000,000 insuring the CMV. Included in the court’s analysis was consideration of Pennsylvania’s Fair Share Act and the exhaustion language under the UIM policy.

Progressive Mut. Ins. Co. v. Butler, 2022 Ga. App. LEXIS 320, C.A. No. A22A0322 (Ga. Ct. App. June 22, 2022). A Georgia appellate court reversed a trial court, which had denied an insurer’s motion to enforce settlement. The insurer had made a settlement offer, which had been unequivocally accepted by plaintiff’s counsel in writing. However, a week later and prior to any signed release, plaintiff fired his counsel and hired new counsel who disavowed the prior settlement, claiming the attorney lacked consent of the plaintiff to agree to those terms, and then demanded additional compensation to settle the claim. The insurer filed a motion to enforce the settlement agreement, which was denied by the trial court. On appeal, the Court of Appeals of Georgia found the prior attorney had apparent authority to accept the settlement offer on behalf of the plaintiff. The court further held there had been an unconditional offer and acceptance, as evidenced by the written acceptance by prior counsel for the plaintiff. The court rejected that a settlement offer has to be made in writing or that the release had to be signed in order for the agreement to be enforceable.

Wesco Ins. Co. v. Brad Ingram Constr., 2022 U.S. Dist. LEXIS 111041, C.A. No. 21-cv-05682 (N.D. Ca. June 15, 2022). An insurer’s motion for summary judgment based upon a pollution exclusion was granted. A contractor to the trucking company assisted in cleanup efforts following the 2018 Camp Fire, hauling hundreds of loads of debris from work sites to hazardous waste dumps. During those cleanup efforts, dust and other airborne matter entered into the truck’s ventilation system. Additionally, the contractor was required to operate in the vicinity of the dust while preparing for and hauling the loads, including while tarping the loads. Ultimately, the contractor fell ill and was diagnosed with sarcoidosis. The contractor sued the trucking company and the prime contractor for the cleanup project. The trucking company, in turn, filed a cross-complaint against another subcontractor (Ingram) on the project, seeking indemnification for the damages sought by the contractor. Wesco insured Ingram under a commercial general liability policy, which included a pollution exclusion for bodily injury claims. The court held the allegedly contaminated dust meet the definition of a pollutant, the alleged damages were caused by the “release” of said pollutant, and the wildfire itself was an “act of pollution” as each of those terms were defined under the policy. As such, the insurer had no duty to defend Ingram in the tort action.

WORKERS COMPENSATION

Liss v. TMS Int’l, LLC, 2022 U.S. Dist. LEXIS 101786, C.A. No. 3:19-cv-00810 (S.D. Ill. June 7, 2022). In an interesting case stemming from a workplace accident at a receiver’s facility, the court held that the motor carrier employer of the injured employee could be held liable to the receiver on the theory that the motor carrier employer failed to properly train its employee. The injured employee—a truck driver—was injured while walking across the receiver’s flooded property. The injured employee sued the receiver alleging unsafe conditions on the premises. The receiver, in turn, filed a third-party complaint under Illinois’ Joint Contribution Act against the motor carrier employer, alleging it failed to properly train the driver. The court found under the operation of the Joint Contribution Act, the motor carrier employer could be held liable for contribution. It further found there is a common law duty upon an employer to properly train its employees, the failure of which, could sustain a claim for contribution under these facts.