October 2025 • Source: Gallagher Sharp LLP
 By Sarah V. Beaubien
The Michigan Supreme Court recently declined to hear the case of Progressive Marathon Ins. Co. v. Espinoza-Solis, effectively leaving in place a ruling from the Michigan Court of Appeals holding that Michigan’s minimum liability limit is $250,000/$500,000 pursuant to MCL 500.3009. Michigan liability limits for third-party bodily injury claims have been a hotly contested issue since the amendment of Michigan’s No Fault Act in 2019, with multiple cases pending in Michigan’s Court of Appeals on this issue.
The Espinoza-Solis Decision
The issues the Court of Appeals addressed in Progressive Marathon Ins. Co. v. Espinoza-Solis are two-fold: 1) what is Michigan’s minimum requirement for insurance liability limits under MCL 500.3009; and 2) is an insurance company required to provide coverage despite the insured’s failure to cooperate in the defense of the case.
The insured, Juan-Carlos Espinoza-Solis, was involved in a motor vehicle accident and failed to cooperate with Progressive in defending the underlying negligence lawsuit brought by the injured third party, Gjovalin Shkreli. Despite Espinoza-Solis’s complete failure to participate in his defense—ignoring counsel’s attempts at contact and failing to appear at depositions and trial—the court held that Progressive remained liable for the full $250,000 judgment entered against its insured.
The Espinoza-Solis court concluded that Michigan’s required minimum residual liability insurance for policies issued after July 1, 2020, is $250,000 per person and $500,000 per accident under MCL 500.3009(1)(a) and (b). Critically, the court held that an insurer may not assert the non-cooperation of its insured as a defense to a claim by a third-party victim to recover these mandatory minimum amounts unless the insured properly exercised the statutory option to select lower coverage under MCL 500.3009(5).
The decision reaffirmed the principle from a long-standing Michigan precedent, Coburn v. Fox 425 Mich 300; 389 NW2d 424 (1986) that held that residual liability insurance under the no-fault act is compulsory and exists for the protection of injured third parties and the public at large. Therefore, the insurer’s obligation to pay bodily injury liability damages within the statutorily required minimums remains intact regardless of the insured’s cooperation.
Key Takeaways
The Espinoza-Solis decision establishes several important principles for insurance companies and risk management professionals.
First, insurers cannot use an insured’s non-cooperation as a shield against third-party claims seeking recovery of the mandatory minimum $250,000/$500,000 liability limits for policies issued after July 1, 2020. This creates significant exposure for insurers when their insureds abandon participation in negligence litigation, as the insurer remains financially responsible for judgments up to the statutory minimums even when the insured provides no assistance in mounting a defense. In my experience in cases with non-cooperative or simply non-existent clients, it is often better to efficiently evaluate and attempt to resolve these cases early.
The Espinoza-Solis decision does not prevent insurers from pursuing available remedies against their insureds for breach of the cooperation clause, but such remedies must be sought separately and cannot be used to defeat third-party victims’ claims for the statutory minimums. While this avenue of recovery directly against the insured is possible, in practice it is likely inapplicable in most circumstances.
Second, the Espinoza-Solis Court held that only exception to this mandatory minimum coverage is if the insured affirmatively elected lower coverage limits pursuant to MCL 500.3009(5) by completing the proper form before the policy was issued—absent such an election, the default $250,000/$500,000 limits automatically apply.
Finally, the Michigan Supreme Court’s denial of leave to appeal solidifies this interpretation as the law in Michigan, meaning that minimum limits of $250,000 per person and $500,000 per accident are currently in effect for all policies issued after July 1, 2020. This interpretation is subject to change, as there are currently multiple cases on the docket of the Court of Appeals discussing the interpretation of MCL 500.3009 and interpretation of Michigan’s liability limits.
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October 2025 • Source: Righi Fitch
Richard Righi and Kimberly Sierra brought home a unanimous defense verdict in a dramatic dram shop action in the Maricopa County Superior Court last week. Rick and Kim’s client, which owns and manages several popular themed restaurants and bars, was sued for statutory dram shop by the victim of an aggravated assault. The Plaintiff, who was herself the manager of a bar, alleged that the Defendant bar overserved one of its customers, and that the overservice of alcohol was a proximate cause of the assault. The Plaintiff based her case on the discovery of a bar tab that arguably showed that the assailant customer consumed 14 drinks or shots after consuming two beers with a meal earlier that same evening in the client’s bar. The assailant left the client bar, went home to his apartment, left to meet up with a person he met online, and ended up in the Plaintiff’s bar. Once there, the assailant was served another alcoholic drink, played pool for about an hour, and then became involved in a verbal altercation with the Plaintiff at closing time. Versions of what was said between the assailant and Plaintiff were disputed, but what was not in dispute was the horrific assault perpetrated on the Plaintiff, all of which was captured on surveillance camera. The camera clearly showed the assailant Defendant violently strike Plaintiff, turn, and calmly walk out the exit door.
A later investigation conducted by local police resulted in his arrest, conviction, and subsequent incarceration for aggravated assault. Tragically, the assault resulted in a traumatic brain injury to the Plaintiff, who was knocked unconscious and was unable to brace herself prior to her head forcibly hitting the concrete floor. Fortunately, the Plaintiff was successfully treated by emergency room physicians. In the defense of their client, Rick and Kim were ultimately successful in locating the assailant, who had moved away from Arizona, served him with a domesticated subpoena, and forced him to testify at the trial. Rick and Kim established that a majority of the drinks on the tab were purchased for others, and that the assailant made it home safely prior to deciding on his own to go back out a cause trouble. The jury ultimately found that the service of alcohol by Rick and Kim’s client was not the proximate cause of the assault and rendered a complete defense verdict. Several months earlier, Rick and Kim filed an Offer of Judgment, which will form the basis for post-trial sanctions and a likely Judgment against the Plaintiff. A significant offer was made on behalf of the client and rejected by the Plaintiff. Punitive damages drove Plaintiff’s case, however, Rick and Kim ultimately convinced the trial Court Judge to dismiss the punitive damages claim pursuant to Rule 50.
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November 2025 • Source: Zarwin Baum
The Federal Aviation Administration Authorization Act (FAAAA) was enacted to create uniformity in the regulation of motor carriers and brokers, preempting a patchwork of state laws that could interfere with interstate commerce. However, in recent years, a sharp circuit split has emerged over whether the FAAAA preempts state-law negligent selection claims against freight brokers. This split has left brokers, shippers, insurers, and litigants in a state of uncertainty, with dramatically different outcomes depending on the jurisdiction.
The Supreme Court’s January 2024 denial of certiorari in Gauthier v. Total Quality Logistics, LLC left the issue unresolved, but the split has only deepened since then. With the Seventh Circuit’s Montgomery v. Caribe Transport II, LLC decision and a new Sixth Circuit opinion, the legal landscape is more fractured than ever. The time is ripe for Supreme Court intervention.
The Legal Framework: FAAAA Preemption and the Safety Exception
The FAAAA expressly preempts state laws “related to a price, route, or service of any motor carrier … or any motor private carrier, broker, or freight forwarder with respect to the transportation of property.” 49 U.S.C. § 14501(c)(1). However, Congress carved out a “safety exception,” providing that the statute “shall not restrict the safety regulatory authority of a State with respect to motor vehicles.” 49 U.S.C. § 14501(c)(2)(A).
Does this exception save state-law negligent selection claims against brokers from preemption?
The Circuit Split: Where the Courts Stand
Ninth Circuit: Safety Exception Applies
In Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016 (9th Cir. 2020), the Ninth Circuit held that while negligent selection claims against brokers are “related to” broker services and thus fall within the scope of FAAAA preemption, the safety exception applies. The court reasoned that common-law tort claims are part of a state’s safety regulatory authority and that claims arising from motor vehicle accidents are “with respect to motor vehicles.” Thus, such claims are not preempted.
Seventh and Eleventh Circuits: Strict Preemption
By contrast, the Seventh Circuit Ye v. GlobalTranz Enterprises, Inc., 74 F.4th 453 (7th Cir. 2023), Montgomery v. Caribe Transport II, LLC, 124 F.4th 1053 (7th Cir. 2025), and the Eleventh Circuit Aspen Am. Ins. v. Landstar Ranger, Inc., 65 F.4th 1261 (11th Cir. 2023), have held that the safety exception does not apply to broker negligent selection claims. Both circuits reasoned that such claims lack a “direct” link to motor vehicles, as required by their interpretation of the statutory language. As a result, brokers are immune from civil liability for negligent selection in these jurisdictions—even if they knowingly select unsafe carriers.
Sixth Circuit: Aligns with the Ninth
In July 2025, the Sixth Circuit in Cox v. Total Quality Logistics, Inc. joined the Ninth Circuit, holding that the safety exception does apply to negligent selection claims against brokers. The court rejected the “direct link” requirement, finding that the substance of the claim—alleging a broker’s failure to exercise reasonable care in selecting a safe carrier—plainly involves motor vehicles and motor vehicle safety.
State Courts and District Courts: Even More Division
State appellate courts and federal district courts are also split, with some following the Ninth and Sixth Circuits’ broader reading of the safety exception, and others adhering to the narrower approach of the Seventh and Eleventh Circuits. In Illinois, for example, a state appellate court recently held that negligent selection claims against brokers are not preempted, creating a direct conflict with the Seventh Circuit’s federal precedent.
Why This Matters: Practical Implications
- Forum Shopping: Plaintiffs’ attorneys are incentivized to file in jurisdictions where the safety exception is recognized, while defense counsel must be vigilant about removal and venue strategy. Venue is a particularly important consideration in forums when there is a split between the Federal Circuit and State law. (i.e. Illinois where a negligent selection case would be expressly preempted under Ye in Illinois Federal Courts but permitted under the Illinois State law).
- Insurance and Risk: Brokers face dramatically different liability exposures depending on the circuit, complicating insurance procurement and risk management.
- Business Uncertainty: The lack of uniformity undermines the FAAAA’s goal of national consistency and creates operational headaches for brokers and shippers engaged in interstate commerce.
The Supreme Court’s Reluctance—But for How Long?
Despite multiple cert petitions, including Ye and Gauthier, the Supreme Court was reluctant to take up the issue.
However, in October of 2025, the Supreme Court finally agreed to address this issue via Montgomery, the 7th Circuit’s decision to uphold and apply Ye. The Circuit split appears to be widening as the 6th and 9th Circuits rely on the safety exception to allow Negligent Selection cases against brokers, while the 7th and 11th Circuits expressly reject the safety exception.
With the split now encompassing at least three circuits and conflicting state and federal decisions within the same states, the pressure on the Supreme Court to grant review is mounting. As the Montgomery petition argues, only the Supreme Court can restore uniformity and provide the clarity that the industry desperately needs.
The Future of FAAA Preemption of State Law Negligent Selection Claims
In light of the Supreme Court Granting certiorari in Montgomery it is expected that the Court will issue a decision by the end of the term in June of 2026. That ruling should provide some guidance moving forward and will likely shape future of state law negligence claims against a broker.
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October 2025 • Source: Righi Fitch
In a pivotal wrongful death case in Utah, Righi Fitch secured summary judgment on behalf of their client. The insurance carrier, facing a policy limits demand, stood firm. The case involved the tragic death of a father of two, a fact that significantly elevated the emotional and financial stakes. The decedent, a primary provider for his young family, left behind a widow and two minor children, amplifying the potential for a substantial jury award. Represented by Arnold & Itkin LLP, a nationally recognized plaintiffs’ firm that touts its billion-dollar verdicts and settlements. Plaintiff’s counsel aggressively pursued maximum compensation, leveraging the emotional weight of the family loss and the firm’s reputation to pressure the insurer into settling for policy limits.
Despite this pressure, the insurer, with the strategic guidance of Righi Fitch attorneys Beth Fitch, Benjamin Hodgson, and Nathan Whittaker, refused to capitulate. The defense team meticulously dismantled the plaintiff’s claims, leveraging early case positioning, rigorous factual analysis, and a proactive litigation strategy. Their efforts culminated in a decisive summary judgment, effectively neutralizing a case that posed significant financial exposure. This outcome underscores the power collaboration among client, carrier, and defense counsel and of disciplined, forward-thinking defense work in the face of emotionally charged, high-dollar litigation.
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October 2025 • Source: Gallo Vitucci Klar LLP
Christopher L. Parisi, a Partner in our New York Labor Law construction practice, won summary judgment in the case Howard Ashman v. New York Convention Center Development Corporation d/b/a Jacob K. Javits Center, et al. (Supreme Court, Queens County). The Order dismissed the plaintiff’s claims against our clients, including common law negligence and claims pursuant to New York Labor Law Sections 200, 240(1), and 241(6). The dismissal was obtained prior to depositions and before significant discovery proceedings took place. In this case, the plaintiff alleges that he was injured in 2019 while working for a concrete subcontractor on the expansion project of the Jacob Javits Convention Center in Manhattan.
Our clients are a holding company and its subsidiary telecommunications installation company. In 2014, the telecommunications company had proposed an internet cabinet installation project at the Jacob Javits Center, which had not gone forward. This proposed project was not part of the Jacob Javits Center expansion project, which started years later.
When the telecommunications subsidiary was acquired by the holding company in 2017, a document was filed on ACRIS, New York City’s real estate records database, which recorded the transfer of non-possessory telecommunications utility easements from the subsidiary to the parent company. The Jacob Javits address had been listed in the utility easement transfer document, along with over two hundred-seventy other addresses.
In support of our Motion, we submitted a detailed client Affidavit that explained the meaning and purpose of the ACRIS document and established that our clients did not have an ownership interest in the project, or any control or involvement with the construction activities. In opposition to our Motion for Summary Judgment, plaintiff’s counsel argued that the Affidavit was defective and that the ACRIS document established our clients’ ownership interest or control over the property and expansion project. The Honorable Justice Frederick D.R. Sampson decided that our Motion and the Affidavit demonstrated that our clients “did not own the property, control, or supervise any of the work being performed, nor had Defendants performed any construction work at the premises.” In granting summary judgment, the Court held, “…it appears that moving Defendants were named herein due to a recorded non-possessory utility easement, which does not confer an ownership interest.”
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