Guest Commentary: David (ASECTT) takes on Goliath (FMCSA) in CSA/SMS Battle in U.S. Court of Appeals on September 10

In the fall of 2010, before initial publication of CSA/SMS data, three trade associations sued the FMCSA in the United States Court of Appeals for the DC Circuit. The case was National Association of Small Trucking Companies et al. v. Federal Motor Carrier Safety Administration (No. 10 1402). That suit resulted in a settlement in which the FMCSA agreed, among other concessions, to the following definitive language on the CSA website: “Unless a motor carrier in the SMS has received an UNSATISFACTORY safety rating pursuant to 49 C.F.R. Part 385, or has otherwise been ordered to discontinue operations by the FMCSA, it is authorized to operate on the nation’s roadways.”

Despite this settlement, the FMCSA continued to tout SMS methodology as fit for use by shippers and brokers, and its public statements continued to frighten portions of the shipping public into utilizing the unproven scores to credential carriers with the false hope of avoiding vicarious liability and negligent selection lawsuits. The Alliance for Safe, Efficient and Competitive Truck Transportation (ASECTT) was formed as a 501(c)(4) association to stand up for the rights of shippers, brokers, and small carriers who were, and still are, suffering unwarranted economic harm from the agency’s misguided actions in publishing and promoting SMS scores.

Numerous studies, including excellent work by Wells Fargo and Dr. James Gimpel, and our own work showed definitively that there is no correlation between SMS scores and individual carrier accident frequency, yet the FMCSA continues to tout its shoddy “averages of the averages” analysis to claim a relationship that simply does not exist. The flaws in the data collection methodology are too numerous to mention in this post. The ever-shifting SMS scorekeeping methodology is evidence enough that the FMCSA knows how flawed the system is, yet the agency continues to publish and tout the scores.

On May 16, 2012 the FMCSA released a series of Internet documents entitled “New Resources Available for Shippers, Brokers, and Insurers.” These documents changed the agency’s prior position that SMS was primarily an internal tool for prioritizing enforcement efforts. Instead, the agency openly urged shippers and brokers to place at least as much reliance on SMS scores as on official safety ratings when making “business decisions” on which carriers to use. ASECTT’s legal analysis of these documents led it to conclude that FMCSA disregarded the earlier Inspector General study criticizing the agency for misuse of the SafeStat system, that they violated the court settlement in NASTC v. FMCSA, that the agency’s change of position on the significance of SMS scores amounted to a new agency “rule” without the requisite rule-making process under the Administrative Procedure Act, 5 U.S.C. 553 (APA), and that ASECTT therefore was required to take legal action. The suit (ASECTT et al. v. FMCSA, No. 12-1305) was filed on July 16, 2012 with the United States Court of Appeals for the DC Circuit. The co-petitioners with ASECTT include four trade associations and twelve individual shippers, carriers and brokers, one of which is Transplace.

CSA/SMS was originally intended as a tool to help the FMCSA prioritize its enforcement resources and as a mechanism to provide feedback to carriers that would help them monitor and improve safety. We have no qualms with those original goals, but that is not how the FMCSA is promoting the use of SMS. The agency’s words and actions are an attempt to redefine the standard of care in selection of carriers by shippers and brokers so that SMS is employed alongside the official Safety Fitness Determination. We believe this is unlawful under 49 U.S.C. § 31144 and the APA as a new de facto procedure for rating the safety of motor carriers that is not the product of a properly-adopted regulation. We also believe the FMCSA violated the Regulatory Flexibility Act (“RFA”) by not publishing a Final Regulatory Flexibility Analysis under 5 U.S.C. § 605(b). In addition, the Agency abdicated its statutory and constitutional obligation to provide uniform national safety fitness standards for motor carriers operating in interstate commerce, thereby exposing shippers to a patchwork of state tort-law standards for assessing the safety of carriers without definitive Agency guidance.

There are both Inspector General and General Accounting Office studies underway that are scrutinizing the SMS methodology and we are confident that the methodology will not stand up to such scrutiny, just as was the case with the FMCSA’s former SafeStat system. The House hearings last summer and fall that precipitated the IG and GAO studies featured blistering bipartisan criticism of numerous aspects of SMS. Nonetheless, we are proceeding with the court case because we can’t wait for these other processes to run their course, nor can we place all of our eggs in those baskets.

ASECTT is truly the David in the case. We are an organization made up primarily of smaller brokers, carriers, shippers, and trade associations. We don’t have the ATA’s or TIA’s lobbying and legal budgets. We will face arguments in court by the FMCSA that it is merely issuing “guidance” or merely “interpreting” its existing safety rules. We are, however, optimistic that the law and the facts in the case are in our favor and the DC Circuit has a long history of striking down de facto rules even though an agency calls them something else. We are well-prepared for our September 10 oral argument before Chief Judge Garland, Judge Rogers, and Senior Judge Williams. We are fighting to subject runaway agency regulators to the rule of law. We are fighting for small carriers, the lifeblood of the trucking industry. We are also fighting for the rights of shippers and brokers who should be able to rely on the FMCSA to uphold its duty to determine which carriers are fit to operate on the highway and to shut down the unfit carriers. We need the support of shippers, carriers, and brokers to sustain our fight against Goliath. Visit ASECTT to find out how you can help.

With more than three decades of experience in the logistics technology, third-party logistics (3PL), and transportation industries, Tom Sanderson is CEO of Transplace, a leading provider of logistics management services and technology. Prior to joining Transplace, Mr. Sanderson held various leadership positions, including president and CEO of Clicklogistics and co-owner and president of PTCG. He also worked 8 years in the trucking industry, serving as president of J.B. Hunt Special Commodities, Inc., Vice President of Marketing for J. B. Hunt Transport, and Vice President of J. B. Hunt Logistics (now Transplace), as well as marketing and IT roles at Schneider National. Mr. Sanderson also performed consulting work with Mercer Management Consulting and Andersen Consulting (now Accenture).


  1. Thank you Tom Sanderson and ASECTT for carrying out this fight for reason. We must have regulations based on FACTS and statistics that are real and proven. Keep it up so we all can benefit. The goal is safe roads, not bureaucratic “mumbo jumbo” that confuses people and sends the wrong message.

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