TRANSPORTATION INDUSTRY NEWS Winter
2017 FMCSA Establishes National Entry-Level Driver 3 Training Standards: First ELD, Now ELDT Let’s NOT Get Personal Protecting Your Personal Assets 4 OSHA’s New Regulations and Drug 5 Testing: What Does It All Mean? Team Directory 7
ELECTRONIC LOGGING DEVICES TWO STEPS FORWARD, ONE STEP BACK MARC TUCKER | marc.tucker@smithmoorelaw.com On December 11, 2015, the day after the Federal Motor Carrier Safety Administration (“FMCSA”) published its final rule mandating the implementation of electronic logging
devices
Independent
(“ELDs”),
Drivers
the
Association,
Owner-Operator Inc.,
(“OOIDA”)
challenged in court the FMCSA and its implementation of the ELD rule. One year from the rule’s December 2017 effective date, the 7th Circuit Court of Appeals has rejected OOIDA’s challenge and cleared the way for implementation. However, just when it appears that all roadblocks have been removed and the path towards implementation is clear, questions still linger. On October 31, 2016, the 7th Circuit denied OOIDA’s
request and upheld the final rule mandating the implementation of ELDs. Owner-Operator Independent Drivers Association, Inc. Mark Elrod, and Richard Pingel, Petitioners, V. United States Department Of Transportation, 2016 WL 6407405 (7th Circuit Oct. 31, 2016). In its challenge, OOIDA made five arguments against implementation: (1) the rule allows for ELDs that are not entirely automatic; (2) the FMCSA’s definition of “harassment” is too narrow; (3) the FMCSA’s cost-benefit analysis fails to justify implementation; (4) FMCSA did not sufficiently consider privacy protections for drivers; and, (5) the ELD mandate imposes an unconstitutional search and/or seizure on drivers.
Id. at 1. The 7th
Circuit rejected each of these arguments noting that: (1) Congress did not intend to require constant surveillance
Continued on Page 2
and that the devices prescribed by the FMCSA satisfy
enforcement and effects on customer relationships are
the “automatic” requirement. Id. at 6; (2) the definition
two legitimate concerns with the pending mandate,
of “harassment” was reasonable, not too narrow, and
the transition from paper logs to ELDs is paramount.
developed by soliciting input from drivers, carriers, and
Scenes of holiday shoppers braving long lines at the
trade organizations. Id. at 7; (3) a cost-benefit analysis was
local mall in order to buy the latest and greatest holiday
not required in order to implement the rule. Id. at 8; (4) the
gift may be supplanted by carriers rushing at the last
FMCSA adopted a reasonable approach to protect ELD
minute to locate a certified ELD. While some carriers
data and maintain a driver’s privacy. Id. at 9; and, (5) the
have adopted ELDs, or are using an Automatic On Board
Fourth Amendment is not implicated by the ELD rule, and
Recording Device (“AOBRD”) and availing themselves
alternatively, the rule would nonetheless be reasonable
of the additional two-year grace period, it is estimated
under the exception for pervasively regulated industries.
that more than one million for-hire and private carriers
Id. at 9-10. The 7th Circuit thus concluded that the ELD
have not. See Seth Clevenger, “Expected Surge in
mandate was reasonable, not arbitrary or capricious,
ELD Demand Could Lead to Messy Rollout,” Transport
and enforceable. Id. at 11-12. On December 14, 2016,
Topics (Nov. 21, 2016). If the switch to ELDs has not
OOIDA filed a petition with the 7th Circuit requesting a
been made, now is the time to do so. The potential for
rehearing on the decision. There is no deadline by which
a last-minute rush and ensuing bottleneck is real; you
the court has to respond to this request.
do not want to be at the end of the check-out line on
While the OOIDA challenge moves forward, drivers and carriers alike are faced with the December 18, 2017, deadline to move from paper logs to ELDs. The looming ELD mandate is on the minds of many within the trucking industry. According to the American Transportation Research Institute’s (“ATRI”) Annual Survey for 2016, the ELD mandate is the top overall issue facing the industry, a jump of five places from 2015. See American Transportation Research Institute Critical Issues in the Trucking Industry – 2016, October 2016, at p. 2, available at http://atri-online.org/wp-
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December 17, 2017. It is unknown if supply will keep up with demand, although it is anticipated that the market will see an influx of certified ELDs in the coming year. A word of caution if you are waiting to the last minute to make the switch; ELD manufacturers listed on the FMCSA website are self-certified. FMCSA does not vet or otherwise approve the manufacturers or their devices. It is ultimately the carrier’s responsibility to make sure the ELD selected complies with the new rule. When purchasing, it is essential to perform due diligence regarding the manufacturer and device.
content/uploads/2016/10/ATRI-2016-Top-Industry-
Electronic logging devices are coming and early adoption
Issues-10-2016.pdf. Uncertainty and apprehension
is encouraged. Avoid the last-minute rush, reap the
surrounding implementation of the ELD mandate is
benefits of improved CSA scores, and ensure compliance
shaping up to cause a bumpy rollout. Although the
and comfortability when compliance counts.
Smith Moore Leatherwood
FMCSA ESTABLISHES NATIONAL ENTRY-LEVEL DRIVER TRAINING STANDARDS: FIRST ELD, NOW ELDT ROB GREEN | rob.green@smithmoorelaw.com
The FMCSA recently announced a final rule establishing national training standards for entry-level commercial truck and bus drivers. The new rule, which is decades in the making, requires that entry-level drivers
demonstrate
proficiency
provided by an entity that is listed
February 2020.
on the FMCSA’s training provider
W H O I S SUBJ ECT TO T HE
registry. A complete list of the items
T R AI N I NG R EQ UI R EMENTS?
required for the ELDT curriculum is
The training requirements apply to first-time Class A and Class B CDL applicants, as well as current CDL
set forth in appendices A through E of 49 CFR 380. These items include classroom and behind-thewheel training on basic operation
in the classroom and behind-the-
holders seeking a license upgrade
wheel through training obtained
(e.g., Class B CDL holder seeking to
of a vehicle, pre-trip and post-
from an instructional program that
upgrade to a Class A). Additionally,
trip inspections, hours of service,
meets
anyone
backing and docking, coupling and
FMCSA
standards.
Much
seeking
to
add
an
to the delight and surprise of the
endorsement to transport hazardous
uncoupling,
transportation industry, the final rule
materials or to operate a motorcoach
emergency
situations,
does not require a minimum number
or school bus will also be subject to
inspections,
maintenance,
of hours for the classroom or behind-
the training requirements.
handling, and post-crash procedures.
the-wheel training. The new rule is set forth at 81 FR 88732 and will be
WHAT TRAINING IS REQUIRED?
implemented at 49 CFR parts 380,
Drivers who are subject to the
383, and 384 of the FMCSRs. The
entry-level driver training (ELDT)
rule goes into effect on February
requirements
6, 2017, with a compliance date of
prescribed program of instruction
must
complete
a
The
distracted
behind-the-wheel
driving, roadside cargo training
requires that certain training be first conducted in a range and before being conducted on a public roadway. To read more go to smithmoorelaw. com/TNLJan2017-ELDT
Smith Moore Leatherwood
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LET’S NOT GET PERSONAL PROTECTING YOUR PERSONAL ASSETS ROB MOSELEY | rob.moseley@smithmoorelaw.com MEGAN EARLY-SOPPA | megan.early@smithmoorelaw.com Of course we love our clients and
hire, or a dispatcher assigns a load to
want to get to know each and every
a driver when he should have known
one of you, but we can all agree you
the driver did not have the credentials
do not want to get too personal
for the shipment. However, plaintiffs’
when
it
your
corporate
attorneys rarely take this approach.
comes
to
maintaining
liability
shield.
We frequently get inquiries from owners and managers of trucking companies asking, “How can I protect my personal assets if something happens involving the business?” In the transportation industry, in light of recent jury verdicts, there is a high level of risk no matter the size of the trucking company. An accident could erase an owner’s equity in a blink. It is important for all business owners to follow the proper procedures to ensure their business is set up to protect themselves, shareholders, and officers from personal liability for the company’s debts and liabilities. For the courts to impose personal
Doing
so
would
create
issues
concerning coverage under a standard motor carrier policy, and plaintiffs’ attorneys don’t normally like to get bogged down in pursuing personal assets where the collection efforts would be akin to a land war in Eastern Europe in the winter. However, the veil piercing issues arise on a regular basis, especially when insurance limits may be insufficient. So, how does a Court determine whether or not to “pierce the veil”? Before we get there, one thing that comes up is, “When can the plaintiff raise the issue?” The majority rule is that a plaintiff can’t conduct discovery
liability on an owner of a trucking
on veil piercing issues until the plaintiff
company there must be (1) personal
has a judgment which is unsatisfied.
actions of the officer or (2) the courts
This makes sense because the point
must “pierce the corporate veil.”
would be moot if the plaintiff doesn’t
In other words, the court ignores
ultimately recover more than the
the protections afforded by the
available coverage.
status of corporation and holds the shareholders or another affiliated
Once the issue is relevant, a court will
corporation liable.
typically consider the following when
As to the first possibility, officers and
the corporate veil:
managers make decisions every day
determining whether or not to pierce
that could impose personal liability on
1. Was the corporation involved in
them for those actions. For example,
fraudulent behavior? Was there
a safety director approves a driver
any wrongdoing or injustice?
To read more go to smithmoorelaw.com/TNLJan2017-Personal
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Smith Moore Leatherwood
SMC³ Jump Start 2017 - Logistics Technology Summit Come listen to Smith Moore Leatherwood attorneys in their breakout sessions at Jump Start, one of the transportation industry’s most strategic educational and networking events, sponsored by SMC3. Rob Moseley, Fredric Marcinak, and Marc Tucker will all be speaking about various issues that affect members of the transportation industry. The 3-day event will take place January 23–25, 2017, at the Loews Hotel in Atlanta, Georgia. For instructions on how to register, including a discount code, go to: http://www.smithmoorelaw. com/SMC-Jump-Start2017-Logistics-TechnologySummit
OSHA’S NEW REGULATIONS AND DRUG TESTING: WHAT DOES IT ALL MEAN? ALEX MAULTSBY | alex.maultsby@smithmoorelaw.com “I heard that OSHA has issued new regulations that change post-accident drug testing. It sounds like OSHA won’t you let you do that anymore.” This comment has been popular in HR and Safety Department circles the past few months, as commentators, consultants, and, yes, even some lawyers have been passing around alarming sound bites. What is really going on here? OSHA has updated (read: changed) regulations on reporting workplace injuries and illnesses, and the main rule-writing
relates
record-keeping
for
to
electronic
and
by
the
government. Employers with twenty or more employees must begin to submit reports electronically; the deadlines and the required forms depend on whether the employer also has at least 250 employees.
The agency has also relied on a basic point—that the only data worth having is accurate data—to state a
recordkeeping system. 2. Inform employees they have a right to report a work-related injury or
few seemingly simple and obvious
illness, and establish a reasonable
rules on how employers talk to their
procedure for it to happen promptly
employees about reporting injuries
and accurately.
and illnesses: 1. Involve
employees
in
To read more go to smithmoorelaw. com/TNLJan2017-OSHA
the
FMCSA POISED TO LAUNCH LONG-AWAITED DRUG AND ALCOHOL CLEARINGHOUSE WAIVER SHAWN KALFUS | shawn.kalfus@smithmoorelaw.com Just
in
Clearinghouse, which will significantly
expected
compliance . . . they change the rule! OK,
expand the duty of motor carriers and
motor carriers and their designated
sarcasm aside, this is actually a much-
select officers and agencies to report,
service agents will be required to
needed and long-overdue change.
and check for, commercial drivers’
report, within three business days:
After
when
you
several
think
years
you’re
of
debate,
lobbying, and fine-tuning, the FMCSA
positive drug and alcohol test results or refusals.
•
regulatory
moratorium,
Alcohol tests with a concentration of 0.04 or higher;
is poised to launch its Commercial
Starting January 5, 2017, just in time
Driver’s License Drug and Alcohol
to beat the Trump administration’s
To read more go to smithmoorelaw. com/TNLJan17-FMCSA
Smith Moore Leatherwood
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THE ROAD AHEAD Fredric Marcinak will make the trek to the left coast for the Conference of Freight Counsel meeting at Dana Point, CA, on January 8–9. January 17 is the next Transportation Webinar. “The FMCSA’s Latest: Drug and Alcohol Clearinghouse and Entry Level Driver Training,” will discuss the new Drug and Alcohol Clearinghouse and how it will effect motor carriers. Register at https://attendee.gotowebinar.com/ register/4067825065697377540 January 19–20 marks the annual Chicago Regional Seminar of the Transportation Lawyers Association. Rob Moseley and Megan Early-Soppa will be attending. Rob will be teaching a session on the MCS-90 endorsement and Megan will try to explain that Rob is smarter than he looks. On January 24–25, Rob Moseley, Marc Tucker and Fredric Marcinak will head to Atlanta for the SMC3 Jumpstart conference in Atlanta’s Midtown. Rob will be teaching an 8-hour contract class. Fredric and Marc have breakout sessions on the safety fitness rating for carriers and cyber security, respectively. For more information go to www.smc3jumpstart.com.
Fredric Marcinak will be attending Specialized Carriers & Riggers Association Specialized Transportation Symposium in Orlando Feb. 14-17 and leading a panel on The Mitigation of Litigation for specialized carriers. On February 16, SML will present a webinar for the Iowa Motor Truck Association. Rob Moseley, Matt Stone, Marc Tucker, Shawn Kalfus and Bennett Crites will head to Knoxville, TN, for the Great West Leadership conference March 1–2. Great West always puts on a strong group of speakers. Kurt Rozelsky will attend the Winter Meeting of the Federation of Defense and Corporate Counsel in Charleston, SC March 6-10. March 21 marks the next date in the series of SML Transportation Webinars. Stay tuned for more on the topic. On March 29–31, Matt Stone will co-present on “Trending issues and tactics in truck accident claims and litigation: Are you prepared for what’s coming down the road?” at the CLM Annual Conference.
Making Tracks October 2–3 marked the American Trucking Association’s (ATA) Management Conference and Exhibition, along with the joint meeting of the National Accounting and Finance Council (NAFC) and the IT Leadership Community (ITLC), in Las Vegas. Rob Moseley spoke on transportation contracts. The South Carolina Trucking Association (SCTA) Board of Directors Retreat on October 10–11 in Columbia, SC, was rained out by Hurricane Matthew. October 13 was the Minnesota Trucking Association food safety seminar in Minneapolis, MN. Rob Moseley and Fredric Marcinak presented on the legal issues relating to the Food Safety Modernization Act and its regulations. At that very moment, Matt Stone and Kurt Rozelsky were in Charm City (Baltimore, MD) for the Trucking Industry Defense Association (TIDA) annual meeting.
Marc Tucker attended the North Carolina Trucking Association (NCTA) Board of Directors meeting and the NCTA Foundation Golf Tournament in Greensboro, NC, on October 26. Matt Stone and Rob Moseley presented at the 7th Annual Atlanta Trucking Conference on Thursday, October 27 in Atlanta, GA. Alex Maultsby was the leader of the November 15 installment of the SML Transportation Webinar Series. Alex spoke on the new overtime rules. Fredric Marcinak was the emcee. For the archived version see http://www. smithmoorelaw.com/transportation-webinar-applyingthe-new-overtime-regulations-in-the-trucking-industry. On December 7, Rob Moseley attended the Board meeting of the SCTA.
The ATA’s Safety and HR Council met on October 24–26 in Oklahoma City, OK. Alex Maultsby and Rob Moseley led sessions on Employment Traps for Trucking Companies. Also, Rob presented another installment of the freight claims boot camp.
Smith Moore Leatherwood
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TEAM DIRECTORY ERIK ALBRIGHT
KEVIN MCCARRELL
MIKE BOWERS
ROB MOSELEY
MANNING CONNORS
K R I S T E N N O WA C K I
RICK COUGHLIN
BOB PERSONS
Greensboro, NC | 336.378.5368 erik.albright@smithmoorelaw.com
Charleston, SC | 843.300.6633 mike.bowers@smithmoorelaw.com
Greensboro, NC | 336.378.5236 manning.connors@smithmoorelaw.com
Greensboro, NC | 336.378.5471 rick.coughlin@smithmoorelaw.com
Greenville, SC | 864.751.7652 kevin.mccarrell@smithmoorelaw.com
*TEAM LEADER* Greenville, SC | 864.751.7643 rob.moseley@smithmoorelaw.com
Greenville, SC | 864.751.7753 kristen.nowacki@smithmoorelaw.com
Atlanta, GA | 404.962.1075 bob.persons@smithmoorelaw.com
BENNETT CRITES
M A R Y R A M S AY
M E G A N E A R LY- S O P PA
JOHN REIS
JULIE EARP
JACK RIORDAN
ROB GREEN
JOSEPH ROHE
J AY H O L L A N D
J E N N I F E R R AT H M A N
MARVIS JENKINS
KURT ROZELSKY
S H AW N K A L F U S
PETER RUTLEDGE
Charleston, SC | 843.300.6653 bennett.crites@smithmoorelaw.com
Greenville, SC | 864.751.7627 megan.early@smithmoorelaw.com
Greensboro, NC | 336.378.5256 julie.earp@smithmoorelaw.com
Greenville, SC | 864.751.7617 robert.green@smithmoorelaw.com
Wilmington, NC | 910.815.7165 jay.holland@smithmoorelaw.com
Atlanta, GA | 404.962.1018 marvis.jenkins@smithmoorelaw.com
Atlanta, GA | 404.962.1042 shawn.kalfus@smithmoorelaw.com
Charleston, SC | 843.300.6659 mary.ramsay@smithmoorelaw.com
Charlotte, NC | 704.384.2693 john.reis@smithmoorelaw.com
Greenville, SC | 864.751.7638 jack.riordan@smithmoorelaw.com
Greenville, SC | 864.751.7668 joseph.rohe@smithmoorelaw.com
Atlanta, GA | 404.962.1074 jennifer.rathman@smithmoorelaw.com
Greenville, SC | 864.751.7624 kurt.rozelsky@smithmoorelaw.com
Greenville, SC | 864.751.7610 peter.rutledge@smithmoorelaw.com
FREDRIC MARCINAK
M AT T S T O N E
A L E X M A U LT S B Y
MARC TUCKER
Greenville, SC | 864.751.7691 fredric.marcinak@smithmoorelaw.com
Greensboro, NC | 336.378.5331 alex.maultsby@smithmoorelaw.com
Atlanta, GA | 404.962.1057 matt.stone@smithmoorelaw.com
Raleigh, NC | 919.755.8713 marc.tucker@smithmoorelaw.com
Register for the Next Transportation Webinar – Jan. 17 The first transportation webinar of 2017, titled “The FMCSA’s Latest: Drug and Alcohol Clearinghouse and Entry Level Driver Training,” will discuss the new Drug and Alcohol Clearinghouse and how it will effect motor carriers. OSHA is also on the warpath for non-DOT drug testing, so we will discuss nonDOT drug and alcohol testing relative to the reporting of workplace incidents. But waitdon’t decide yet! We will throw in an overview of the FMCSA’s new rule on entry-level driver training requirements. Presenters include Rob Green, Shawn Kalfus, and Alex Maultsby. Rob Moseley will be the moderator. Register at https://attendee.gotowebinar.com/ register/4067825065697377540
Smith Moore Leatherwood LLP Attorneys at Law 2 West Washington Street Suite 1100 Greenville, SC 29601 T 864.751.7600 F 864.751.7800 www.smithmoorelaw.com
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Emergency Response Team As part of the array of transportation services provided to firm clients, our 24/7 emergency response team is standing by to serve clients with urgent needs following a catastrophic accident. The team has handled numerous night time and weekend emergencies for our clients. Members of the emergency response team take responsibility for preserving physical and electronic evidence, taking driver and witness statements, making arrangements for cargo salvage, and managing relations with law enforcement. Additionally, firm clients benefit from the team’s knowledge of substantive experts and criminal defense counsel. smithmoorelaw.com/emergencyresponseteam
Smith Moore Leatherwood
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