The Cost of Risk: Don’t let new legal tactics trip you up

The liability picture for motor carriers grows ever worse as plaintiffs attorneys become more aggressive and look for new ways to slam trucking companies in court, attorney Clay Porter told attendees at the Commercial Carrier Journal Fall Symposium, held last month in Scottsdale, Ariz. Porter is a founding partner in the Atlanta-based law firm Dennis, Corry, Porter & Smith, which specializes in motor carrier and truck insurer defense, and serves as outside general counsel to Schneider National.

“In the risk management area of trucking, the concern is really about surprises,” said Porter, who cautioned that most of his top new trucking casualty risks still were emerging and had not yet proven to be disastrous for trucking companies.

Still, Porter highlighted three risks directly related to driver management: speed, cell phones and medication. “Speed management has never shown up as a theory of liability,” he said. “I think it’s about to.” The reason Porter is concerned about speed as a liability issue is that carriers have the technology through governors and onboard telematics to control and track a driver’s speed. Porter rejected arguments that slowing trucks down could create an unsafe situation because of varying road speeds. First, more than half of trucks already are governed at below 70 mph, he said. And even if there are more accidents due to cars rear-ending trucks, that’s better than accidents due to trucks rear-ending cars. “The industry has got to start taking responsibility for safety again.”

Regarding cell phones, studies repeatedly show that the distraction from talking on phones while driving is a significant safety problem, Porter said. To the extent carriers are aware that drivers are using them or perhaps are even paying for them, they could find themselves liable.

Medication is a particularly sticky worry, Porter said. The safety regulations prohibit drivers from using any substance that renders them incapable of safely operating a motor vehicle. But the Federal Motor Carrier Safety Administration hasn’t clearly defined those substances, and in any event, carriers can be caught between liability and drivers’ privacy rights.

Two of Porter’s emerging risks relate directly to how carriers collect and retain information. The first is the threat of a spoliation claim due to failure to retain documents. Spoliation is the destruction of information or data that would have constituted evidence, and it is often an independent cause of action in court. Supporting documents required for log verification must be kept for six months, but another part of the federal regulations – Appendix A to Part 379 – requires that “dispatchers’ sheets, registers, and other records pertaining to movement of transportation equipment” be retained for three years. “Plaintiffs lawyers are just now becoming aware of this regulation,” Porter said. Another potential trap stems from new federal rules of evidence that kick in Dec. 1: Those rules require the production of electronic documents during discovery to a much greater extent than ever before.

The scariest potential risk – at least to individual managers and executives – is company officer liability, which might emerge from the law Congress adopted last year, Porter said. That law subjects motor carriers to suspension or revocation of their operating authority if an officer engages in a pattern or practice of avoiding compliance with regulations on commercial motor vehicle safety, or engages in a pattern or practice of concealing noncompliance.

The definition of an officer is “tremendously broad,” Porter said. While the statute doesn’t subject the officer to criminal penalties, it’s likely that plaintiffs attorneys will try to link the regulation to civil liability in the event of a truck crash. “Up until now, you couldn’t sue the president of the company.”

Clay Porter’s Top 10 new casualty risks

  • Broker liability
  • Shipper liability
  • Speed management
  • Cell phone liability
  • Document retention/spoliation
  • Electronic document production
  • Company officer liability
  • Insurance company liability for safety management
  • Driver medication
  • Escalating verdicts