The fight over freight broker transparency has hit the front lines again, this time in the form of a lawsuit between Total Quality Logistics and Pink Cheetah Express LLC. Pink Cheetah claims that TQL hasn’t followed the broker transparency rule in place.
The complaint centers on TQL’s alleged refusal to provide Pink Cheetah with transactional records for 15 loads hauled over the past three years, despite a Nov. 30, 2023, order from the Federal Motor Carrier Safety Administration. That order follows a regulation guaranteeing carriers access to broker records – and compliance with future transparency requests. Pink Cheetah claims TQL has done neither, accusing the Cincinnati-based brokerage of “arrogantly” acting “above the law.”
After looking into one load that had TQL making 44% margin, Pink Cheetah requested additional records. TQL allegedly is denying Pink Cheetah the documentation for an additional 14 loads, and Pink Cheetah would like the court to compel TQL to release the documents and have TQL remove the waiver clause from all contracts. The waiver clause has language waiving carriers’ rights under 49 CFR 371.3 – a regulation guaranteeing carriers access to broker records.
As of now, TQL hasn’t responded to the suit publicly.
It is both a perfect time and a horrible time for this case to be thrust into the spotlight as the FMCSA has reopened the comment period on a proposed broker transparency rule that would state that “brokers have a regulatory obligation to provide transaction records to the transacting parties on request.” The records would also have to be kept in a digital format under the proposed rule.
The FMCSA extended the comment period because of public interest in the rule at the urging of the Small Business in Transportation Coalition. As of now there are over 6,000 comments on the issue, with a high number in favor of the proposed rule.
Got an opinion on it? The FMCSA would love to hear about it.
Given that it took over four years to get to this stage of the rulemaking process and the FMCSA’s main priority is safety on the roads, it’ll likely be a while until something officially comes to fruition, but it will be one of the last chances to make your voice heard.
Also, depending on how the courts rule on this case, it could set a huge precedent for the brokerage space ahead of any published rule.
TRAC Tuesday. This week’s TRAC lane is a 454-mile jaunt through the South from Dallas to Memphis, Tennessee. The BBQ lane has seen spot rates plummet since the beginning of the month from a peak of $2.25 to $1.88 per mile. Outbound tender rejections are declining in both cities but have minimal week-over-week changes. Outbound tender rejections are at 8.26% in Dallas and 6.7% Memphis.