Great West Casualty Company v. Cobra Trucking, Inc., et al., 2013 WL 431949 (D. Mont. 2013).

Insurer Great West issued a policy to motor carrier Cobra Trucking which specifically excluded coverage for brokerage operations. Cobra had a contract with a shipper defining it as a carrier. Per typical procedure in the trucking industry, it dispatched a load to one of its owner operators for a haul originating in Montana and concluding in Wyoming. The driver was involved in an accident that, tragically, killed one and injured two other motorists. Cobra and the claimants sought coverage under Great West’s policy. This prompted the insurer to sue all concerned in the District of Montana seeking a declaratory judgment that Cobra’s assignment of the load to an independently-authorized operator constituted uncovered brokerage.

On the claimants’ motion for summary judgment, the court explained that Great West’s understanding was flawed. It rejected the insurer’s argument that brokerage operations can be conducted without a party acting as a broker, and that motor carriers may provide brokerage services under 49 CFR §371.2(c). Shipping documentation quite clearly demonstrated that Cobra was its shipper’s carrier of record here, firmly establishing that absent a new transaction with a new motor carrier, that it was “legally obligated to transport” the shipper’s cargo. The owner operator didn’t have any contract with Cobra’s shipper at all. Add to that the fact that Great West’s policy “does not define ‘broker operations,’” and you have a recipe for motor carrier coverage. Motion for summary judgment granted.