California's latest trucking ruling narrows brokers' exposure, with an appeals court finding XPO Logistics not liable for a contractor driver's paralysis after a 2020 crash.
In a decision filed on January 16, 2026, the California court said XPO Logistics, acting as a licensed property broker, did not owe a duty of care to the injured truck driver, who worked for the motor carrier XPO Logistics had hired to move the load.
The accident occurred on March 21, 2020, during a rainy night on a highway outside Oklahoma City. Plaintiff Yongquan Hu was sleeping in the truck's bunk while his co-worker drove a load of plasticware from Sabert Corporation's warehouse in New Jersey to its California facility. Around 10:30 p.m., the driver lost control, causing the truck to hit a barrier, lose the trailer, cross the road and collide with another barrier. Hu was left paralyzed.
Sabert had relied on XPO Logistics, a federally licensed property broker, to arrange the transport. XPO Logistics was authorized to act as an intermediary between shippers and carriers but was not licensed as a carrier, did not own trucks, did not employ drivers and had no maintenance or safety department.
The contractual framework proved crucial. XPO Logistics and Sabert's February 2019 "Broker/Shipper Transportation Agreement" stated that XPO's responsibility was "limited to arranging for, but not actually performing, transportation" of freight. It expressly provided that XPO Logistics is "not a carrier" and that listing XPO as carrier on bills of lading was "for [Sabert's] convenience only" and would not change XPO Logistics's broker status. The agreement limited XPO Logistics's liability to Sabert for cargo loss or damage caused by XPO Logistics's negligence to $100,000 per shipment.
XPO Logistics's October 2019 agreement with American Alliance Logistics, Inc. (Alliance), a federally licensed motor carrier, similarly stated that XPO Logistics would not "be considered a 'motor carrier' for any purpose." Alliance agreed to "load, transport, deliver and unload all freight" in a "safe and secure manner" and to have "exclusive supervision and control" over its drivers and equipment. Alliance also agreed to "assume the liability of a common carrier for full actual loss or damage to goods transported" and be "directly liable" to the shipper.
For this shipment, Sabert paid XPO Logistics $3,925 consisting of a line-haul rate and fuel surcharge. Alliance assigned Hu and his co-worker to the job, selected the route, and owned and maintained the truck. XPO Logistics did not select the drivers, pay them, own or maintain the truck, or specify the route. XPO Logistics did require tracking software to monitor the shipment's progress.
After the crash, XPO Logistics arranged for another Alliance truck to complete the delivery. Sabert received $12,003.54 for cargo damage, with XPO Logistics paying half and XPO Logistics's insurer paying the other half. Alliance had failed to carry workers' compensation insurance.
Hu sued XPO Logistics on March 1, 2021, alleging XPO Logistics "controlled" the rig and Alliance's operations and was "acting as" a carrier, thus owing a nondelegable duty to ensure workplace safety. To support his case, Hu presented 180 bills of lading from 2019 and 2020 listing XPO Logistics as "carrier" for Sabert shipments and an expert declaration opining that XPO Logistics functioned as a carrier.
The trial court granted summary judgment for XPO Logistics, and the Court of Appeal affirmed.
The court applied California's rule that a company hiring an independent contractor generally owes no duty of care to the contractor's employees for workplace injuries. On the nondelegable duty exception, the court noted that licensed motor carriers have such duties because they operate businesses involving "very considerable risk" and face specific safety obligations under federal statutes and regulations. But XPO Logistics was not a licensed carrier, and those regulations apply only to "motor carriers."
Even assuming a nondelegable duty might apply to an unlicensed entity acting as a de facto carrier, the court found no evidence that XPO Logistics was "providing motor vehicle transportation for compensation." The carrier agreement placed all operational responsibilities – inspections, maintenance, driver supervision, vehicle and route selection – on Alliance, which had "exclusive" control. The court found no evidence XPO Logistics was involved in selecting, training or monitoring drivers, or in truck inspection or maintenance.
The court rejected Hu's reliance on factors like XPO Logistics's line-haul pricing, bills of lading listings, its intermediary role, and its insurance arrangements, holding these facts were not material to whether XPO Logistics was providing transportation services.
On retained control, the court found no evidence XPO Logistics had any role in truck or driver safety or in Alliance's training, inspection or maintenance practices. XPO's direction on delivery timing and location and its shipment tracking were treated as part of a broker's normal function – control over results, not the manner of performance.
The court also rejected Hu's reliance on Essex Insurance Company v. Barrett Moving & Storage, Inc., which addressed cargo damage liability under the Carmack Amendment. The court held Essex is "irrelevant" to personal injury claims under California tort law. Essex focuses on whether a broker should be liable for cargo damage, while Hu's claim concerned workplace safety duties. Factors like bill of lading labels and cargo insurance arrangements do not determine whether a broker owes a duty of care to a contractor's employee.
For insurers and risk managers in the transportation sector, the ruling reinforces that bodily injury claims from contractor drivers will generally sit with the motor carrier and its coverage, not the broker, unless the broker effectively steps into a carrier role or directly controls safety-critical operations.
