Amazon can be held liable for faulty products, rules US court

In a major blow to Amazon, a court in California has ruled that the e-commerce giant can be held liable for defective products sold by third-party sellers on its platform.

The ruling by California Fourth District Court of Appeals on Thursday came in response to an alleged incident in which a woman received third-degree burns after a defective replacement laptop battery she bought from a third-party seller on Amazon marketplace caught fire, CNBC reported.

In her allegation, the woman, Angela Bolger, stated that she bought the product from Lenoge Technology HK Ltd., a third-party seller on Amazon’s marketplace.

“Under established principles of strict liability, Amazon should be held liable if a product sold through its website turns out to be defective,” the court said.

The ruling could have widespread implications as Amazon has long avoided taking responsibility for defective and sometimes unsafe products sold on its platform by arguing that it hardly has any role to play in sourcing and distribution of products sold by third-party sellers.

However, the latest ruling did not come in favour of the e-commerce giant.

“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,” the court said.

Amazon’s marketplace accounts for nearly 60 per cent of the company’s e-commerce sales, said the CNBC report.

The e-commerce giant had earlier said it invests hundreds of millions of dollars every year to ensure safety and authenticity of the products sold on its platform.