Penske Ruling: Re-Brokered Loads Can Land on Your Policy

On Aug. 4, 2026, the U.S. Court of Appeals for the Fifth Circuit decided Crane v. Penske Transportation Management (No. 25-40012). The question, in the court's own words: can a motor carrier that outsourced a shipping job to a second carrier, which then outsourced it to a third carrier, be held liable for the negligence of the driver hired by the third carrier? The district court in the Southern District of Texas said no. The Fifth Circuit disagreed and reversed. Opinion: https://www.ca5.uscourts.gov/opinions/pub/25/25-40012-CV0.pdf

The chain, per the opinion: car-seat maker Adient hired Penske Logistics. Penske handed the job, through its affiliate broker Penske Transportation Management (PTM), to carrier Liberty Lane. Liberty Lane then had its own affiliate broker hire a third carrier, OK Trans, which supplied the truck and the driver. On the way to Laredo, that tractor-trailer jackknifed, crossed into oncoming traffic, and killed Lyndon Dean Meyer. FreightWaves reports the crash happened the day after Christmas 2018 on Highway 202 in Bee County, Texas. That load changed hands more times than a hot plate at a truck-stop potluck, and the court still traced it back to the first carrier.

The key holding: because Penske, a carrier, hired Liberty Lane, a carrier that had leased the truck from OK Trans, their arrangement fell under the federal leasing rules (49 C.F.R. 376.22), which required Penske to take control and responsibility for operating the equipment. That opens the door to statutory-employer, or vicarious, liability for a driver Penske never hired. The court also sent the negligent-hiring claim against the broker affiliate back to the lower court, noting the Supreme Court's 2026 Montgomery v. Caribe Transport II decision abrogated the preemption ruling the district court relied on.

The fight is not over. FreightWaves (John Kingston, Oct. 12, 2026) reports Penske has asked for an en banc rehearing before the full Fifth Circuit, the victim's estate filed its opposition last week, and amicus briefs backing rehearing came from the American Trucking Associations and Truckload Carriers Association (jointly) and from the Trucking Industry Defense Association. Penske argues the ruling is a first in trucking law because it had no arrangement, communication, or knowledge of the final carrier. The plaintiffs argue an indirect arrangement is still an arrangement under the statute. Source: https://www.freightwaves.com/news/penske-request-for-en-banc-hearing-gets-pushback-from-victims-estate

This is a liability ruling, not a verdict. The case was sent back to the district court, and no damages have been decided. But the theory matters to every carrier that ever hands a load to someone else: overflow loads to a buddy's truck, a brokerage arm under the same roof, or a partner carrier on a busy week. If the Fifth Circuit's reading stands, the first carrier in the chain can be treated as the statutory employer of a driver it never met. The Fifth Circuit covers Texas, Louisiana, and Mississippi, and other courts watch these decisions.

Your auto liability policy is written around the trucks and drivers you tell the underwriter about. A load that leaves your hands and rides on someone else's truck can fall in a gap: is that a hired auto on your policy, or only a scheduled one? Does your brokerage affiliate carry its own contingent auto liability? Those answers live in your policy wording, not in a rate confirmation. If you do not know them, find out before a claim does it for you.

Cargo is the second hole. Re-brokered and double-brokered loads are where cargo claims get ugly: the shipper looks to you, your cargo form may only respond for loads in your care on listed units, and the carrier who actually had the freight may carry a different limit or none at all. Underwriters also notice operations that look like brokering on a carrier authority. Expect more questions at renewal about subhauling, interlining, and affiliated brokerages.

We are not promising prices, approvals, or same-day coverage, and this is general information, not legal advice. Whether a given policy responds depends on its forms, endorsements, and the facts of a loss.

1. Pull every load you handed to another carrier in the last 90 days. For each one, confirm you had a written agreement and a current certificate from the hauling carrier, and that the MC on the rate confirmation matches the truck that actually showed up. If you cannot reconstruct it, stop subhauling until you can.

2. Put a no-re-brokering clause in your carrier agreements and rate confirmations, and enforce it. If a carrier you hire hands your load to someone else, you want that to be a breach you can point to, not a surprise you learn about from a lawyer.

3. Call your agent and ask three direct questions: does my auto liability cover hired autos or only scheduled ones; does my brokerage arm (if I have one) carry contingent auto and contingent cargo; and are my limits and any umbrella realistic for a fatal-crash lawsuit in the states I run. Fleets can start at https://supremetruckinginsurance.com/fleet, owner-operators at https://supremetruckinginsurance.com/owner-operator, and Texas carriers at https://supremetruckinginsurance.com/trucking-insurance/texas.

Q: I'm an owner-operator leased on to a carrier. Does this change anything for me?

A: Under a normal lease, your carrier is already responsible for your operation. The risk this case highlights is the next step: taking a load and quietly giving it to another truck. Don't. If you have your own authority and haul under it, the same no-subhauling-without-paperwork rule applies to you.

Q: Is the Penske ruling final?

A: No. As of FreightWaves' Oct. 12 report, Penske's request for an en banc rehearing is pending before the Fifth Circuit, and the case itself was sent back to the district court. Watch for the en banc decision.

Q: Does my cargo policy cover a load I re-brokered to another carrier?

A: Often not the way people assume. Many cargo forms are built around loads on your own listed units. Ask your agent before you hand off freight, not after it goes missing. More on cargo coverage: https://supremetruckinginsurance.com/cargo

Supreme Trucking Insurance helps fleets, owner-operators, and new authorities line up auto liability, cargo, physical damage, and filings with how they actually run, including subhauling and affiliated brokerages. A ten-minute call now is cheaper than finding the gap in a deposition.

Call (360) 936-7196 or start a quote at https://supremetruckinginsurance.com/quote. Need a certificate sent to a broker? https://supremetruckinginsurance.com/coi-request. Requesting a quote does not bind coverage. This article is general information, not legal advice.