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Amazon And Product Liability Litigation: Part II

On Behalf of | Sep 23, 2020 | Firm News

In our last post, we wrote about a California appellate court ruling that found Amazon could be held liable for a defective laptop battery that exploded and seriously injured a San Diego woman. This is despite the fact that Amazon did not manufacture the battery. It was made by a third-party Chinese manufacturer that all but vanished when the victim tried to sue the company for her injuries.

The Court held that Amazon was a significant part of the distribution chain and could have exerted product safety influence on the seller. As such, it could be held liable for the defective product in much the same way that brick-and-mortar retailers would be.

Almost 60 percent of the products sold on Amazon’s site come from third-party sellers. Many consumers don’t realize this, nor do they realize that Amazon has largely been shielded from liability when it comes to defects with these third-party products. But Amazon has been aggressive at recruiting sellers, often with little vetting of a company’s safety record or business practices. While assuming no liability and doing little vetting, Amazon is nonetheless entitled to about 15 percent of proceeds from sales made through its site.

A growing number of legal professionals and politicians believe that this is not a fair or sustainable business model. As such, courts are beginning to rule against in Amazon in product liability cases and legislators are drafting bills to close these loopholes.

Recently, one California legislator introduced a bill that would subject e-commerce sites to the same liability laws that brick-and-mortar stores face. Amazon actually said it supports the bill as long as it applies to all online marketplaces, including Amazon’s much smaller and niche competitors (sites like Etsy, for instance). These competitors could not afford to absorb the additional costs associated with increased liability.

The bill has since been withdrawn, perhaps to be reintroduced in the next legislative session. But it the meantime, it is unlikely that these legal issues will simply disappear for Amazon.
As one of the largest and most successful companies in the United States, Amazon can no longer deny its outsized role in bringing products to consumers – including products from foreign sellers that consumers might otherwise never know about.

If you’ve been harmed by a dangerous and/or defective product, there may be a number of parties that could be held liable for causing your injuries. To better understand all of your rights and legal options, please discuss your case with an experienced personal injury attorney.