A court has ruled Amazon is liable for defective products, including those sold by third-party sellers.
To date, Amazon has managed to avoid being held liable for defective products sold by third parties in its Marketplace. A California Court of Appeals ruling changes that, however, reversing a previous decision by a San Diego Superior Court.
The case centers on a woman who purchased a replacement laptop battery that later exploded, injuring her. Amazon has argued it is merely a service provider, and therefore shouldn’t be held liable. In her ruling, Justice Patricia Guerrero said Amazon’s involvement went far beyond that of a service provider.
“As a factual and legal matter, Amazon placed itself between Lenoge and Bolger in the chain of distribution of the product at issue here. Amazon accepted possession of the product from Lenoge, stored it in an Amazon warehouse, attracted Bolger to the Amazon website, provided her with a product listing for Lenoge’s product, received her payment for the product, and shipped the product in Amazon packaging to her. Amazon set the terms of its relationship with Lenoge, controlled the conditions of Lenoge’s offer for sale on Amazon, limited Lenoge’s access to Amazon’s customer information, forced Lenoge to communicate with customers through Amazon, and demanded indemnification as well as substantial fees on each purchase. Whatever term we use to describe Amazon’s role, be it ‘retailer,’ ‘distributor,’ or merely ‘facilitator,’ it was pivotal in bringing the product here to the consumer.”
This ruling will likely have profound implications on Amazon’s business, although what those are remains to be seen.