Transportation Brief: Spotlight Cargo Claim & Freight Charge Practice
Dec 3, 2021
The global supply chain crisis, paired with the continuing challenges of the pandemic, means motor carriers, cargo brokers, freight forwarders, and shippers are experiencing a significant increase in claims related to delay and cargo damage as well as a slowdown in the payment of freight charges, yet the demands for payment have generally increased.
In the current environment, force majeure clauses have taken on increased importance because they can help transportation providers protect themselves from claims when circumstances beyond their control preclude performance or delay performance. The traditional force majeure defenses of an “act of God” and “act of government” may not be enough to mitigate the unforeseen consequences of the supply chain logjam or COVID-related delivery rejections and losses, so tailored contract provisions may be needed to provide the appropriate protections. Transportation providers should be aware that market shifts and increased operating costs generally do not protect against non-performance. Likewise, the proper documentation is a prerequisite to asserting certain defenses to cargo claims, such as time limitations and limitations of liability, and for recouping the cost of collecting freight charges.
With COVID-related financial difficulties on the rise, transportation providers should endeavor to quickly identify those shippers or intermediaries that may be prone to a bankruptcy or company shutdown. Further, providers should be careful to minimize their losses when customers are unable to pay and reduce their (and their customers’) potential exposure to collection claims for charges not paid by the responsible intermediaries by promptly pursing payment and recovery.
The Firm’s Cargo Claim & Freight Charge group, led by Kathleen Jeffries, Thomas Gonzalez, Christopher McNatt, Andrew Marquis, Nathaniel Saylor, and Michael Tauscher, regularly assists clients with addressing cargo claim and freight charge issues. Equally important, the team can help mitigate exposure before issues arise.
Transportation Brief: Vaccination Mandates Take Shape
by Shannon M. Cohen , A. Jack Finklea , David D. Robinson , Prasad SharmaThe federal contractor mandate, the private employer mandate, and rules for land and ferry border crossings have started to clarify how the Biden Administration’s vaccination initiative might impact the transportation industry – although the final force and effect of these rules remains unclear. Read the latest on these ever-evolving rules.
Transportation Brief: Enforcing Choice-of-Law Provision, Federal Court Dismisses Illinois Wage Claim
by Chip Andrewscavage , Andrew J. ButcherThe Northern District of Illinois recently dismissed IWPCA claims raised by the owners of several motor carriers based on a Virginia choice-of-law clause. More from the Scopelitis Chicago office on why the decision is particularly notable.
Transportation Brief: Freight Broker Class Action Attacks Continue
by David D. RobinsonThe transportation industry continues to battle class action lawsuits focused on the classification of freight brokers as exempt from the payment of overtime under the Fair Labor Standards Act (FLSA). Recent court decisions (and a host of settlements) have served to highlight the vulnerability of an exempt classification for these workers. Why do some recent cases mean that companies should fully examine their classification of these workers as exempt versus non-exempt?
Transportation Brief: Massachusetts Considers ABC Test for Joint Employment
by Gregory M. Feary , Prasad SharmaIn the Jinks v. Credico oral argument before the Massachusetts Supreme Judicial Court, the Court may reject using Massachusetts’ ABC test in the joint employer context. During oral argument in early October, several justices were skeptical, suggesting it would be unworkable to apply the ABC test to determine whether any entity farther up the contracting chain is an employer of a worker who is one or multiple steps removed. More on this decision from the Massachusetts high court that would be a welcome development.
Transportation Brief: FAAAA/AB5 U.S. Supreme Court Developments
by R. Jay Taylor,The U.S. Supreme Court is currently considering whether to review two major Ninth Circuit preemption cases with significant implications for the transportation industry. In California Trucking Ass’n v. Bonta, a federal district court in California issued an injunction barring enforcement of AB5, California’s statutory ABC employment classification test that effectively extends coverage of California’s wage and hour laws to owner-operators working in the state. The Supreme Court is also considering whether to review the Ninth Circuit’s decision in C.H. Robinson v. Miller. In that case, a federal district court held that the FAAAA preempted a plaintiff’s claim that a freight broker negligently selected an unsafe motor carrier. Read the latest regarding these two potentially pivotal cases.
Transportation Brief: Autumn 2021 On the Record
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