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Amazon Exploits a Legal Loophole to Sell Unsafe Third-Party Products

Amazon Prime customers order over 5 billion products every year. Electronics, books, imported foodstuffs, toys – you can find anything on Amazon, and usually at competitive prices. However, roughly 58% of Amazon’s profits from third-party sellers, which means that the online retailer enjoys a nice legal loophole when it comes to product liability claims.

In Georgia, a plaintiff can file product liability claims for:

  • Manufacturing defect cases
  • Defective design cases
  • Marketing defect cases

A customer reasonably expects a product they order to be both functional and safe to use. Fortunately, most states, including Georgia, have established laws that hold companies and manufacturers accountable for marketing defective and/or inherently dangerous products.

But can you sue Amazon, “Earth’s most customer-centric company,” for a defective product sold by a mysterious third party?

A Dangerous Online Marketplace

Many sellers use Fulfillment by Amazon (FBA) to import and sell products from other countries, like China. The products are inspected at customs and at Amazon warehouses, but no one tests to see if the product works, let alone complies with U.S. federal requirements. A recent investigation by the Wall Street Journal revealed that over 4,000 products on Amazon have been deemed unsafe by federal agencies. As the article explains, “In practice, Amazon has increasingly evolved like a flea market. It exercises limited oversight over items listed by millions of third-party sellers, many of them anonymous, many in China, some offering scant information.”

There is also the issue of “hijacked listings,” where ill-intentioned sellers offer a counterfeit or low-quality version of a product as “used & new” or “available from other sellers.”

The Legal Loophole

Unfortunately, Amazon has been able to dodge defective product liability claims because the online retailer refuses to claim ownership of third-party items – even though the company facilitates third-party sales, processes payments, and delivers stored products on behalf of third-party vendors.  

However, recent lawsuits have been testing the online giant’s legal shield:

  • Last July, a court held Amazon liable for damages in Oberdorf v. Amazon.com Inc. The plaintiff purchased a retractable dog leash from a third-party seller in 2015. During a walk, the leash snapped, whipped back, and permanently blinded the plaintiff’s left eye. Because the seller’s account had already been deactivated, Amazon was held responsible as the “only member of the marketing chain available.” The court added that Amazon, in this case, was “fully capable, in its sole discretion, or removing unsafe products from its website.”
  • In the same month, a Wisconsin district court ruled that Amazon functions as a “seller” in State Farm Fire and Casualty Co. v. Amazon.com, Inc.
  • On August 26, a federal district court in New Jersey finally settled the challenging Papataros v. Amazon. com, Inc case. The plaintiff in this case, Nicole Papataros, purchased a scooter from a third-party vendor on Amazon. Her son – like many children – sustained severe injuries after using the defective product. The court determined that Amazon should be held legally and financially responsible for the child’s injuries and monetary losses.

Pursue Restitution with Pratt Clay, LLC

Sadly, these cases are the exceptions, not the rule, and Amazon lawyers are always ready to file an appeal. To secure damages in a product liability case, you need to contact an experienced attorney as soon as possible. At Pratt Clay, LLC, we can investigate the defective product, connect the dots to identify all negligent parties, and litigate against aggressive corporate legal teams on your behalf.

Contact Pratt Clay, LLC at (404) 998-5258 to arrange a free and informative consultation today.