Transportation Blog

President Obama released his FY 2014 budget (available here), which includes a request that Congress continue funding the federal government’s intensifying efforts to combat employee “misclassification” nationwide.  This program is described as follows (from p. 126):

When employees are misclassified as independent contractors, they are deprived of benefits and protections to which they are legally entitled, such as minimum wage, overtime, unemployment insurance, and anti-discrimination protections. Misclassification, together with the underreporting of cash income for those paid as independent contractors, also costs taxpayers money in lost funds for the Treasury and in Social Security, Medicare, the Unemployment Trust Fund, and State programs. The Budget includes approximately $14 million to combat misclassification, including $10 million for grants to States to identify misclassification and recover unpaid taxes and $4 million for personnel at WHD to investigate misclassification.

These funding levels are the same as seen in the President’s FY 2013 budget.  Of particular interest is the $10 million in state grants, which are doled out by the U.S. Department of Labor as an incentive for states to reclassify independent contractors as employees.  The Department of Labor’s FY 2014 budget (summary available here) goes into more detail regarding this program (from p. 25):

The FY 2014 UI State Administration request includes $10,000,000 for states to improve worker misclassification efforts. Modeled on a successful (SNAP) Supplemental Nutrition Assistance Program, this initiative will provide a “high performance bonus” to the States most successful at detecting and prosecuting employers that fail to pay their proper share of UI taxes due to worker misclassification and other illegal tax schemes that deny the Federal and State UI Trust Funds hundreds of millions of dollars annually. States will be able to use these incentive funds to upgrade their misclassification detection and enforcement programs. As part of this initiative, States would be required to capture and report outcomes and cost/benefit information to enable the evaluation of new strategies.

While it remains to be seen what Congress will ultimately enact, the President’s budget demonstrates that the executive branch of the federal government remains focused on combating “misclassification” – and in directly funding state agencies that do so as well.  Any company retaining the services of independent contractors (including owner-operators) should be sure to adopt and adhere to contractual and operating procedures which best protect independent-contractor status.

For additional information on the federal government’s attack on so-called “misclassification” or questions regarding the protection of independent-contractor status, contact Greg Feary, or Braden Core in the Firm’s Indianapolis office at (317) 637-1777
 

Given that segments of our industry rely on the use of consumer reporting agencies to perform background checks and prepare consumer reports, transportation employers will want to ensure that they are using a new version of the Summary of Your Rights Under the FCRA form (Summary of Rights) in order to comply with the Fair Credit Reporting Act (FCRA).

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 transferred the rulemaking and enforcement powers over the FCRA to the newly created Consumer Financial Protection Bureau (CFPB).  The CFPB recently issued a new version of the Summary of Rights form that should be used by employers beginning on January 1, 2013.  This new Summary of Rights form resembles the old form, but directs individuals to contact the CFPB for more information on their rights under the FCRA.  The new form can be downloaded here (See Appendix K).

As a reminder, the FCRA requires that employers provide individuals with a Summary of Rights in the following situations:

1. Adverse Action.  If an employer is going to take some type of adverse action against an individual based in whole or in part on the contents of a background check or “consumer report”, the employer must, prior to taking any adverse action, provide the individual with a “pre-adverse action” notice and a Summary of Rights.
 
2. Investigative Consumer Reports.  If an employer plans to obtain an “investigative consumer report” on an individual (an assessment of an individual’s character, general reputation, or personal characteristics obtained through personal interviews with the individual’s neighbors, friends, and associates), the employer must provide the individual with advance written disclosure of its intent and a Summary of Rights.

Carriers should review their FCRA compliance protocol to ensure that this new Summary of Rights form goes into use on January 1, 2013.  For additional information, please contact David Robinson at 317-637-1777.

Effective January 3, 2012, the Federal Motor Carrier Safety Regulations (“FMCSR”) prohibited commercial drivers from using hand-held mobile phones while operating a commercial truck or bus. Violations of the rule can result in fines of up to $2,750 to drivers and $11,000 to motor carriers.  Habitually offending drivers of this new rule can be disqualified from operating a CMV. This ban can also create additional hurdles for accident liability claims.   

Motor carriers should act quickly to ensure compliance.  To assist with this process, the Firm has prepared sample notices for both employee and independent contractor drivers.  Both of the these form are available to our clients for a flat fee of $200.  The forms achieve the goals of providing ample notice to the drivers of this change in the law and memorializing the motor carrier’s commitment to the compliance.  Also, to the extent allowed by law, the employee driver form includes a reimbursement provision for situations where a motor carrier incurs a fine because of the employee driver’s non-compliance. The independent contractor form references the independent contractor agreement indemnity language for situations where a motor carrier incurs a fine because of the independent contractor’s non-compliance.

If you would like to obtain these form, please contact asmith@scopelitis.com.  Upon your request, both of these forms will be emailed to you.   

Scopelitis, Garvin, Light, Hanson & Feary
www.scopelitis.com
(317) 637-1777

Employers waiting for the California Supreme Court to clarify California’s meal and rest break rules in the case of Brinker Restaurant Corp. v. Superior Court, No. S166350 may have to wait a little longer.  The case is expected to resolve the contentious question of whether California employers must ensure that employees take thirty-minute off-duty meal breaks or just make them available to employees.  Oral argument was held November 8, 2011.  Under the Supreme Court’s rules, a decision was expected by mid-February, 2012, 90 days after the argument.  On December 2, 2011, however, the Supreme Court agreed to accept additional briefing addressing whether a ruling on the so-called “rolling 5” issue will apply retroactively or only to future violations.  As a result of this additional briefing, it is possible, although uncertain at this time, that the Supreme Court could issue a decision as late as April, 2012, 90 days following the completion of this additional briefing. 

The “rolling 5” issue addresses the time meal breaks must be provided during a workday.  California law generally requires that employers provide employees a 30-minute off-duty meal break whenever they work five hours or more, and another 30-minute meal break where work shifts exceed 10 hours.  The “rolling 5” issue in Brinker is whether employees are entitled to one break during work shifts up to 10 hours long and a second break for shifts over 10 hours (the defendant’s position), or whether employees cannot work for more than five hours without a break (the “rolling 5” position advocated by the plaintiffs).  The Brinker plaintiffs contend that an employer must schedule meal breaks near the middle of shifts to avoid work periods in excess of five hours or pay the hour premium if an employee works more than 5 hours without a break. 

The Brinker plaintiffs’ position on the “rolling 5” issue would have a potentially significant impact on transportation providers operating in California.  Under the “rolling 5” theory, if a driver takes a meal break early in the shift, the driver would be entitled to another one five hours later and could conceivably be entitled to three in a 12-hour shift.  Incorporating these breaks into a driver’s day would be problematic and would, in our view, adversely impact the carrier’s operations and potentially conflict with the federal Hours of Service Rules and the Federal Aviation Administration Authorization Act (the “FAAAA”).  Indeed, as many of the Firm’s clients know, a federal district court in California recently ruled that California’s meal and rest break rules are preempted by the FAAAA as applied to motor carriers. See http://transportationblog.scopelitis.com/blog/transportation-blog/federal-district-court-finds-faaaa-preempts-california-meal-and-rest-break-rules.

We are following the Brinker case closely and will keep you apprised of developments.  In the meantime, while a ruling in Brinker could be delayed by this additional briefing, employers operating in California should not wait to adopt written policies advising employees of their meal and rest break rights under California law.  Employers should also post a copy of the applicable California Industrial Welfare Commission Wage Order (for transportation providers, IWC Wage Order No. 9) in the same place they post other standard employment notices.  Copies of Wage Order No. 9 and other wage orders can be obtained from the Firm.  Questions regarding Brinker or California’s meal and rest break rules in general should be directed to Jim Hanson.

As mid-year insurance renewals are finalized, the transportation industry needs to be alerted to certain revisions to the “Notice of Cancellation” provision in the ACORD 25 Certificate of Insurance (“COI”).  The revised ACORD 25 removed long-standing language requiring prior written notice to the certificateholder (often 30 days) of any policy cancellation.  This change has prompted concerns on how certificateholders will be assured they will receive information on the status of cargo coverage.  Also effective March 21, 2011, the FMCSA stopped requiring regulated motor carriers (with the exception of household goods movers and freight forwarders) to file proof of cargo insurance.  Thus, in most common situations, members of the public are no longer able to obtain information regarding the status of a particular motor carrier’s cargo coverage via the FMCSA’s website.

Insurance regulators further recognized that insurance companies may not be able to satisfy the prior written notice requirement in those instances where an insured chooses to immediately cancel an insurance policy.  In this regard, modifying the ACORD 25 cancellation provision and removing the language requiring prior written notice of cancellation was intended to reduce the likelihood that a COI would run afoul of state insurance laws and regulations prohibiting misrepresentations of insurance coverage.

To ease concerns of shippers and others that request a COI, transportation providers may wish to explore various options such as endorsing the underlying policy to include a requirement that the certificateholder receive advance notice of cancellation or including a provision in the shipping agreement confirming that the insured will provide prior notice of cancellation.  Motor carriers confronted with this issue may need to explore these options in order to maintain valuable business relationships and ensure compliance with state insurance laws.  A thorough review of the relevant shipping agreements may also be necessary to ensure that such agreements are consistent with the language contained in the applicable COIs.

The Firm recently became aware of an initiative by the New York State Department of Taxation and Finance whereby civil penalty assessment notices are being issued to New York Highway Use Tax (“HUT”) account holders that previously filed HUT reports during reporting periods in which the carrier’s vehicles lacked 20th Series Certificates of Registration (i.e., per vehicle HUT permits).  Since the 19th Series Certificates expired on or about September 30, 2009, the Department views such non-renewing motor carriers as having operated vehicles in New York without valid HUT permits.  The civil penalty assessment is issued in the amount of $2,000 for each vehicle previously permitted with a 19th Series Certificate.

Any motor carrier in receipt of a civil penalty assessment notice must act quickly in order to contest the assessment.  This can be done by providing a written response to the Department within 30 days of the issuance date of the civil penalty assessment notice in the form of a request for abatement of the civil penalty, e.g. for reasonable cause.  The Department’s audit division will review all requests and it remains to be seen how stringently the Department will enforce the civil penalty provisions related to invalid HUT permits.  Any motor carrier in receipt of a civil penalty assessment notice should also take immediate steps to obtain 20th Series Certificates for all its vehicles subject to the HUT.   

On January 4, 2011, the Federal Motor Carrier Safety Administration (“FMCSA”) issued a notice entitled Regulatory Guidance Concerning Electronic Signatures and Documents, 74 F.R. 411 (2011).  The guidance brings some clarity to the application of the federal Electronic Signatures in Global and National Commerce (“E-Sign”) Act and the Government Paperwork Elimination Act (“GPEA”) to documents required by FMCSA regulations to be generated and maintained (or exchanged by private parties).  In particular, the guidance makes clear that electronic signatures are permissible so long as the method of signing: (1) identifies and authenticates a particular person as the source of the electronic communication; and (2) indicates such person’s approval of the information contained in the electronic communication.  In the past, FMCSA officials had been unclear as to whether electronic signatures are permissible on FMCSA-required documents.  FMCSA has also changed its approach to the electronic storage of documents.  FMCSA previously interpreted 49 C.F.R. § 390.31 to permit the electronic storage of records so long as they could be produced within two working days of a request.  In the guidance, however, FMCSA rescinds that interpretation and states that, going forward, all records, whether electronic or paper, must be produced within the time frame established by FMCSA regulations.

While FMCSA’s guidance makes clear that electronic methods may be used to sign documents required by FMCSA regulations, there remain open questions as to what methods of effecting an electronic signature will be deemed compliant.  For this reason, motor carriers intending to move to electronic signatures should ensure that any method adopted fully complies with the guidance, as well as the E-Sign Act and the GPEA.
 

The IFTA Articles of Agreement currently impose a punishing 12% per annum rate of interest on delinquent tax payments.  In order to better adapt to changes in the economy, Indiana proposed an amendment to the Articles that would lower the interest rate for U.S. based fleets and adjust the rate annually. 

IFTA’s membership adopted Indiana’s proposed amendment just this week, but the change will not be effective until July 1, 2013.  At that time, the interest rate for fleets based in U.S. jurisdictions will be set at an annual rate of two percentage points above the underpayment rate established under §6621(a)(2) of the Internal Revenue Code (which has fluctuated between 8% and 4% in the last few years) and will be adjusted annually on January 1.  Interest will accrue monthly at 1/12 of the annual rate. 
 

In a move that stands to affect motor carriers, the National Labor Relations Board (the “Board”), on December 22, 2010, published a Notice of Proposed Rulemaking (the “Notice”) in the Federal Register relating to employer obligations under the National Labor Relations Act (the “Act”).  The Notice is the fulfillment of the Board’s recent promise to effect policy through rulemaking rather than by statute.  The Board issued the proposed rule because the Board believes employees are unaware of their rights under the 75 year old Act.

Under the proposed rule, private-sector employers (including motor carriers but excluding airline and railroad employers) must post a notice of employee rights, including the right to:
 

• Organize a union to negotiate wages, hours, and other terms of employment.
• Form, join or assist a union.
• Bargain collectively through representatives of employees’ own choosing for a contract with the employer setting wages, benefits, hours, and other working conditions.
• Discuss terms of employment or union organizing with co-workers or a union.
• Take action with one or more co-workers to improve working conditions by, among other means, raising work-related complaints directly with the employer or with a government agency, and seeking help from a union.
• Strike and picket, depending on the purpose or means of the strike or the picketing.
• Choose not to do these activities, including joining or remaining a member of a union.

The notice of employee rights would also expressly inform employees that it is illegal for the employer to:

• Prohibit soliciting for a union during non-work time, such as before or after work or during break times; or from distributing union literature during non-work time, in non-work areas, such as parking lots or break rooms.
• Question employees about their union support or activities in a manner that discourages employees from engaging in that activity.
• Fire, demote, or transfer employees, or reduce hours, change shifts, or otherwise take adverse action, or threaten to take any of these actions, because employees join or support a union, or because employees engage in concerted activity for mutual aid and protection, or because employees choose not to engage in any such activity.
• Threaten to close the workplace if workers choose a union to represent them.
  • Promise or grant promotions, pay raises, or other benefits to discourage or encourage union support.
• Prohibit employees from wearing union hats, buttons, t-shirts, and pins in the workplace except under special circumstances.
• Spy on or videotape peaceful union activities and gatherings or pretend to do so.

To the extent an employer’s workforce is mobile or remote, and the employer regularly communicates with employees electronically, the above notice must be communicated in the same way.  Currently, only federal contractors are required to post a notice similar to the notice proposed by the Board.  The Board has asked for comments on the proposed rule before the Board finalizes the rule, including comments on whether the Board has the power under the Act to create the proposed rule at all.  Comments, however, must be submitted within 60 days. 

 

The federal judge presiding over the FedEx Ground Package System Inc. (“FedEx Ground”) multidistrict litigation (“MDL”) ruled this week that classes of FedEx Ground drivers in numerous states are independent contractors, not employees. In re MDL-1700 FedEx Ground Package Sys. Inc., Employment Practices Litig., No. 3:05-MD-527 RM (MDL 1700) (N.D. Ind. Dec. 13, 2010) (“Dec. 13, 2010 Order”).   

The court’s decision comes on the heels of its August 11, 2010 ruling that a class of Kansas drivers are independent contractors, not employees, under the Kansas Wage Payment Act. See In re MDL-1700 FedEx Ground Ground Package Sys. Inc., Employment Practices Litig., No. 3:05-MD-527 RM (MDL 1700), 2010 WL 3239363 (N.D. Ind. Aug. 11, 2010) (“August 11, 2010 Order”).  Following that ruling, the Court instructed the parties to file supplemental briefing explaining whether the Court should reach the same result – on claims under the laws of other relevant States relating to overtime, business expense deductions from wages, late payment of wages, meal-and-rest breaks, and similar wage-related statutory and breach-of-contract claims – in the MDL’s many other collected cases in which similar summary judgment motions regarding drivers’ employee-vs.-independent-contractor status were awaiting decision. 

The MDL consists of numerous class action cases filed by drivers against FedEx Ground in courts around the country that were combined for coordinated pre-trial proceedings in the U.S. District Court for the Northern District of Indiana in 2005.  In general, the cases allege that FedEx Ground drivers were improperly misclassified as independent contractors, and that the drivers were therefore covered by state and federal laws applicable to employees.  Some of the cases also alleged violations of federal law, including the FLSA and the FMLA, and common law causes of action for breach of contract.  Eventually, at least 56 separate putative class actions from 40 states were transferred to the Northern District of Indiana as part of the MDL.  In 2008 and 2009, the MDL court certified some of the cases as class actions and declined to certify others.  The parties then proceeded to file summary judgment motions on the issue of the drivers’ employee-vs.-independent-contractor status.  The Court’s ruling this week represents the latest stage of the litigation.

In its August ruling in the Kansas case, the Court summarized its conclusion that drivers were independent contractors as follows:

The plaintiffs have all signed Operating Agreements labeling themselves as independent contractors, they can hire others to perform their assigned work and go work for another delivery company, and they can sell their routes to other qualified drivers; yet, they contend they are employees.  The court sees it differently. Upon review of the evidence in the light most favorable to the plaintiffs, the only reasonable inference is that FedEx hasn’t retained the right to direct the manner in which drivers perform their work. FedEx supervises the drivers’ work and offers numerous suggestions and best practices for performance of assigned tasks, but the evidence doesn’t suggest that FedEx has the authority under the Operating Agreement to require compliance with its suggestions. Further, other factors strongly weigh in favor of independent contractor status; in particular, the parties intended to create an independent contractor arrangement, the drivers have the ability to hire helpers and replacement drivers, they are responsible for acquiring a vehicle and can use the vehicle for other commercial purposes, they can sell their routes to other qualified drivers, and FedEx doesn’t have the right to terminate contracts at-will. Although some facts weigh in favor of employee status, after considering all the relevant factors, the court finds that the plaintiffs are independent contractors as a matter of law.

See Aug. 11, 2010 Ruling at 3.  In this week’s decision, the court repeated this same passage (beginning with “Upon review of the evidence…”).  See Dec. 13, 2010 Ruling at 11-12 (quoting Aug. 11, 2010 Ruling at 3). 

In the vast majority of states involved (AL, AZ, AR, CA, FL, GA, IN, KY, LA, MD, MN, NH, NJ, NY, NC, OH, OR, PA, RI, SC, TN, TX, UT, WV, WI, in addition to KS), the MDL court this week ruled that drivers were independent contractors under each respective state’s legal test. The Court’s detailed reasoning, state by state, is set forth on pages 18-176 of the decision.

The Court noted (at 4-5) that in arriving at both the Kansas decision and this week’s decision, it “has considered evidence common to the drivers’ relationships with FedEx on a nationwide basis:  the Operating Agreement [lease] and generally applicable Policies and Procedures.  As a condition of class certification, the court excluded particularized evidence of actual control between FedEx and the drivers. …These cases might or might not come out differently under a different procedural posture allowing wider scope for review of extrinsic and particularized evidence, but that situation is not before the court today.” 

The Court denied the plaintiffs’ request to give preclusive effect – that is, to treat as already having decided the issue – the California Court of Appeal’s decision in Estrada v. FedEx Ground Package System, Inc., 64 Cal. Rptr. 3d 327 (Cal. Ct. App. 2007) that a FedEx Ground Single Work Area (“SWA”) class of drivers were employees.  The Court stated (at 8): “The facts before the Estrada court and those before this court are dissimilar insofar as the facts available to this court don’t go beyond the Operating Agreement and generally applicable Policies and Procedures…. Also, the SWA class in Estrada was markedly different from the classes before this court because the MDL classes lump together SWA and MWA drivers.  Thus, though the parties litigated a right to control issue in Estrada, the issue decided in Estrada, isn’t identical to issue before this court.”

The Court also rejected the plaintiffs’ assertion that it viewed as dispositive the Operating Agreement’s indication that the parties intended to create an independent-contractor relationship.  The Court said (at 10) that “the intent factor weighed ‘strongly’ because the intent expressed in the contracts was so clear, not because the intent factor had special status or carried dispositive weight.”

The Court went on to declare (at 10-11, citations omitted) that “Most important in Kansas – and the most important under the common law and Restatement tests generally – is the right to control, which typically is the weightiest factor….  This court held that there was no reasonable inference that FedEx retained the right to control the methods and means of the drivers’ work on a class-wide basis. This finding came in light of the distinction between control of means and control of results.  In most states, control of results doesn’t indicate employee status; control of means used to achieve contracted-for results does indicate employee status.  Drawing the line between means and results is a challenging, highly contextual and fact-specific task.  Bright-line rules prove elusive here.  This court held that the controls reserved to FedEx were results-oriented:   FedEx provides work to and pays contractor-drivers to provide the specific result of timely and safely-delivered packages to FedEx customers.  The totality of the circumstances and review of all the relevant facts and factors led to this results-oriented conclusion.”

The Court further explained (at 11) that it “found the drivers’ entrepreneurial opportunities to be highly probative of independent contractor status.”

The drivers are expected to appeal the court’s ruling.  
 

The Sixth Circuit Court of Appeals recently issued an opinion clarifying the impact of logo liability on insurance coverage under Ohio law.  The case, Carolina Cas. Ins. Co. v. Panther II Transp., Inc., No. 09-4166, involved a coverage dispute between a carrier’s auto liability insurer (Zurich) and the driver’s bobtail liability insurer (Carolina Casualty).  At issue was the applicability of Wyckoff Trucking, Inc. v. Marsh Bros. Trucking Serv., Inc., 569 N.E.2d 1049, 1054 (Ohio 1991), which established logo liability in Ohio.

Carolina Casualty argued that Wyckoff not only fixes liability on the carrier in cases of logo liability, but also obligates the carrier’s auto insurer to assume liability for defending and indemnifying any losses resulting from the accident. The Sixth Circuit court rejected this contention, holding that, at least for purposes of Ohio law, logo liability does not decide the respective obligations of the competing insurers.  In other words, even if the carrier is liable to the public as a matter of law, it can still seek indemnity under the bobtail policy. Other courts (both in Ohio and elsewhere) had reached the opposite conclusion; namely, that logo liability fixes liability on the carrier and ipso facto binds the carrier’s insurer to providing coverage. The Sixth Circuit declined to follow those cases and noted that, in doing so, it was weighing in on an unresolved issue of Ohio law (and one that remains open in several other states).

The Panther II decision affords carriers an argument that, even in cases where logo liability operates to render the carrier liable to an injured motorist as a matter of law, an applicable bobtail policy may still provide primary coverage for the accident. Thus, at least in Ohio (and arguably other states in the Sixth Circuit, including Michigan, Tennessee, and Kentucky), before a carrier’s auto liability insurer throws in the towel on coverage where logo liability is involved, it is important to review the terms of any applicable bobtail policy and determine whether the carrier and auto liability insurer have an argument that the bobtail policy should provide primary coverage, logo liability notwithstanding.

The Sixth Circuit’s opinion is available at 2010 U.S. App. LEXIS 22929.
 

The Fifth Circuit Court of Appeals recently issued an opinion clarifying the scope of the MCS-90 endorsement.  In Canal Ins. Co. v. Coleman, No. 10-60196, Timothy Briggs, a trucker and employee of P.S. Transport, was backing a truck into his driveway when he collided with a vehicle occupied by Bernetta Coleman and her husband Glen.  At the time of the accident, Briggs was was driving the truck “bobtail,” meaning he did not have a trailer attached to his truck and was not transportation property.  For this reason, the parties stipulated that Briggs was not engaged in the “transportation of property” at the time of the accident.  The Colemans brought suit against P.S. Transport in state court to recover for their injuries.

In response to the state-court suit, P.S. Transport’s insurer, Canal Insurance, filed a declaratory judgment action in federal court claiming that it owed no coverage under the MCS-90 endorsement because Briggs was not transporting property at the time of the accident.  The sole issue presented by the Colemans’ appeal to the Fifth Circuit was whether P.S. Transport’s automotive insurance policy, specifically the policy’s MCS-90 endorsement, covered the accident between Briggs and the Colemans.  The Colemans argued that that whenever a truck operated by a motor carrier required to carry an MCS-90 endorsement is involved in an accident, the MCS-90 endorsement should provide coverage anytime the policy itself does not.  The Fifth Circuit rejected this argument, instead holding that there is no coverage created by the MCS-90 endorsement when the driver is not engaged in “the transportation of property” at the time of the accident.

That being said, the Fifth Circuit cautioned against reading its opinion too broadly.  While it would seem that the Court substantially limited the scope of the MCS-90 endorsement by tying coverage to whether the driver was transporting property, the Court noted that its holding was based solely on the parties’ stipulation that Briggs was not engaged in the “transportation of property” at the time of the accident.  The Court noted that the definition of “transportation” given in the Motor Carrier Act is quite broad, and suggested that Briggs could have been found to be in engaged in “transportation” even though he was not transporting property at the time of the accident.

Thus, while the Coleman opinion represents a victory for motor carriers and their auto insurers, it is unclear to what extent future cases will attempt to distinguish its holding on the basis of the parties’ controlling stipulation.  Carriers and insurance companies facing MCS-90 endorsement issues in the Fifth Circuit and elsewhere should carefully evaluate both the facts and controlling law to determine whether coverage is likely to be available for the accident at issue.