Illinois Supreme Court Rejects Appeal By C.H. Robinson

The Illinois Supreme Court has denied an appeal request from C.H. Robinson Worldwide over a $23.8 million civil verdict against it, following a fatal traffic accident involving a carrier hired by the broker.

A spokesman for C.H. Robinson, North America’s largest freight broker, said last week the company would not pursue additional appeals at the federal level.

The Illinois high court actually reached its decision in late September without explanation or comment as to why the justices had decided to deny the company’s request, but news of the ruling is only now circulating through freight industry circles.

The decision leaves in place an Illinois Appellate Court ruling from March that upheld the 2009 decision of a trial court that found Robinson among those liable for a 2004 traffic accident in Will County, Ill., with two fatalities (4-18, p. 36).

“We are obviously disappointed that the Illinois Supreme Court declined our petition for further review, as we strongly believe that the Illinois Court of Appeals failed to follow well-established Illinois law regarding a party’s responsibility for the negligence of an independent contractor with which it

contracts,” said Ben Campbell, Robinson’s general counsel.

The appeals court “also improperly attempted to distinguish this case from multiple prior state and federal court decisions in which precisely the same claim has been asserted against C.H. Robinson and summarily dismissed as a matter of law,” he added.

The case arose from an accident on Interstate 55 southwest of Chicago. Owner-operator DeAn Henry, leased to motor carrier Toad L. Dragonfly Express, was hauling a load of potatoes owned by Robinson that was heading for a warehouse operated by the broker. The truck was involved

in a collision, killing two and injuring others.

An attorney representing the widow of one of the deceased said Robinson was held properly responsible.

“People who want to call themselves brokers can’t pull the strings behind the curtain and then say they’re not in control,” said Timothy Cantlin, whose law firm represented the widow of one of those killed.

“When you look at the factors, Robinson was much more than just a broker. They were the dispatcher and controlled everything until the accident occurred,” said Cantlin, adding that his client’s share of the verdict was $8.5 million.

The three main parties named as defendants after the accident were owner-operator DeAn Henry, Dragonfly Express — which since has closed — and Robinson, which had the deepest pockets of the three.

For the 12 months ended Sept. 30, Robinson reported net income of $425.6 million on net revenue of $1.62 billion.

Brokers, who do not own trucks, historically have argued that they should not be held responsible for accidents involving trucking companies and owner-operators that are separate businesses. The appellate court said that was not the case in this lawsuit, known as Sperl v. C.H. Robinson.

The 3-to-0 March ruling from the appellate court focused on Robinson’s control of the shipment.

The ruling noted that Robinson imposed fines on the trucker to ensure its schedule was met. The “special instructions included the potential for multiple fines and forced Henry to violate federal regulations,” which showed the control Robinson had in the shipment, the court said.

The Sperl case already has changed how brokers do business and leaves them wondering how to balance service for customers without exposing themselves to legal liability, said Robert Voltmann, president of the Transportation Intermediaries Association.

“In a just-in-time freight environment, you have to ask how much control is the right amount and how much control is too much. It’s hard to know,” Voltmann said.

“Since the incident, people have made adjustments. A lot of this hinged on Robinson calling itself a ‘partner,’ and we’ve all stopped using the P-word now,” Voltmann added.

He said it is too early to know all of the effects of Sperl, but he said it is “disconcerting” to observe how jury verdicts have soared from $4 million to $24 million “in a very short amount of time.”

“This is an issue because it’s a very new and unpredictable liability,” Voltmann said. “Everyone has a right to sue everyone else. The sharks [plaintiffs’ attorneys] are all chummed up, and they’re looking for pots of money.”

Robinson said earlier this year that its direct liability in the case was $5 million plus interest, and after that, its insurance company would pay for the remaining, roughly, $19 million.