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Businesses The Courts

Court Rules Amazon Liable for Hoverboard that Burst Into Flames (msn.com) 110

Posted by EditorDavid from the second-party-resellers dept.
Amazon accounts for "roughly half of all online sales," while "more than half of all the stuff sold by Amazon comes from third parties," reports a business columnist for the Los Angeles Times.

But is Amazon legally and financially responsible for the safety of those products? Amazon says no. A trio of state Court of Appeal justices in Los Angeles this week said otherwise.

"We are persuaded that Amazon's own business practices make it a direct link in the vertical chain of distribution under California's strict liability doctrine," the justices ruled, rejecting Amazon's claim that its site is merely a platform connecting buyers and sellers... "Amazon is the retailer. They're the one selling the product," said Christopher Dolan, a San Francisco lawyer who spearheaded the case against the e-commerce behemoth. "Because of this ruling," he told me, "you can be sure Amazon is rewriting all its rules for third-party sellers, and it's doing it today..."
The case began in 2015 when a California woman named Loomis gave her son a hoverboard for Christmas in 2015 — and less than a week later its lithium-ion batteries exploded while charging: In pursuing his case on Loomis' behalf, Dolan found that the Chinese manufacturer and its U.S. distributor had gone out of business, "leaving only Amazon to be held accountable for the injuries to Ms. Loomis and the damages to her home." Amazon prevailed in the original case. An L.A. judge agreed with the Seattle company that it was merely an "online advertiser" and not responsible for the third-party products it sells. The lawsuit was dismissed in March 2019.

This week's appellate court decision overturns that ruling, holding Amazon accountable for the products it allows third parties to sell on its website.

The appellate justices cited Amazon's "substantial ability to influence the manufacturing or distribution process through its ability to require safety certification, indemnification and insurance before it agrees to list any product...." Product liability experts told me this week's decision makes clear that online merchants are just that — merchants — and can't hide behind their connecting-the-world technology to shield them from responsibility for distributing unsafe goods.
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Court Rules Amazon Liable for Hoverboard that Burst Into Flames More

Court Rules Amazon Liable for Hoverboard that Burst Into Flames

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  • Amazon sells huge quantities of these. A trickier case, but one that needs to happen.

    • And counterfeits and fake UL listed (Score:5, Insightful)

      by goombah99 ( 560566 ) on Saturday May 01, 2021 @04:31PM (#61336732)

      So so many counterfeits on amazon. I love how they even stamp apple logos on their earbuds. And even the ones that don't claim to be apple are still design patent stealing.

      I've had usb power plugs catch fire and "lightning" connectors overheat. It's quite unsafe and not in a little way when they stamp CE or UL on these things. A consumer cannot tell one from another but you might die in a fire.

      • THIS^^^^

        Yep, there are loads and loads and loads of counterfeit crap on Amazon and it's almost impossible to tell until you're holding it your hands.

        Same with eBay, which if anything is even worse. As soon as you complain on eBay the seller scrambles to refund you or send another one of whatever it is. Doesn't matter whether it's a battery or butt-plug*, the first thing they do is offer a refund so they can keep the game going.

        These days buying stuff off of eBay is like playing Russian Roulette with 4 bulle

        • You can’t tell and even can’t be sure even with a good seller you won’t get stuck with rip offs. Knockoffs are put in the same bin as legit product because “it’s all the same” and then legit sellers get bad reviews while scammers make off with the money. There have been lots of complaints about this but from what I’ve seen this is still happening.

        • Re: (Score:3)

          by ksw_92 ( 5249207 )

          The trick with eBay is to buy used stuff that you know about, not new stuff. I'm keeping several older cars on the road with salvage parts marketed through eBay and have only had one problem: the wrong part shipped. The seller let me keep the part (not that I could use it) but refunded me.

          I've had so many problems with Amazon and counterfeit "new" car parts that I no longer use them for anything important.

          Amazon has supplanted Sears as the US omnibus catalog retailer. I wish they'd keep the original Sears a

          • I get it. All I want to do is buy the thing that's advertised, no more and no less. It's getting harder and harder.

            I bought a "3.2v 650mah" battery. Upon arrival it was *much* smaller than the original battery. It's impossible for it to be the same battery. There are some things you can cheat on, but the physical size of a given battery ain't one of them.

            Physics dictates that a particular kind of battery (like a NiCad) of a particular capacity is going to be a certain size and no smaller. There's no way to

  • What's on the receipt/statement (Score:5, Insightful)

    by Sebby ( 238625 ) on Saturday May 01, 2021 @03:44PM (#61336614)

    If the receipt or your card statement states "AMAZON", and it's Amazon that charged/took your payment, then it's Amazon that sold you the product. The "we're just a distributor" or "we're just a facilitator between you and a third party" excuse doesn't entirely absolve them.

    • If the receipt or your card statement states "AMAZON", and it's Amazon that charged/took your payment, then it's Amazon that sold you the product. The "we're just a distributor" or "we're just a facilitator between you and a third party" excuse doesn't entirely absolve them.

      It's not always that simple. Many smaller retailers make use of payment processing centers to process credit card transactions. Should these PPCs be held liable for the products sold by these retailers?

      • No, because they did not advertise or facilitate the sale or delivery of the item. For all they know, you could be sending this retailer $50 out of the goodness of your heart.

        • It's not that clear to what degree eBay is actually involved, though. They put their name all over the process, but in actual fact they are behaving only as a storefront and payment processor. Their name might be on the shipping labels, but the shipping and even the labels themselves are actually handled by a third party. eBay is really no more directly involved in your sale than USPS or Visa.

          eBay is not even a common carrier because they are not a carrier.

      • > . Many smaller retailers make use of payment processing centers to process credit card transactions. Should these PPCs be held liable for the products sold by these retailers?

        If the "small retailer" is selling their product THROUGH the "payment processor's" website then they damn well should be. This is Amazon trying to have their cake and eat it too. "We're the world's biggest retailer!" "Oh but anything you bought that blows up or starts your house on fire, that actually _wasn't_ sold by us... for

        • "We're the world's biggest retailer!"

          Amazon is not the world's biggest retailer, nor have they ever claimed to be.

          • Depends how you count but by several metrics they are.

            https://www.forbes.com/sites/laurendebter/2019/05/15/worlds-largest-retailers-2019-amazon-walmart-alibaba/?sh=2287a2414171

            https://www.thetimes.co.uk/article/amazon-takes-title-of-world-s-biggest-company-for-first-time-6k3dhlwz3

            https://www.infosys.com/iki/insights1/digital-retailer.html

          • Re: (Score:2)

            by dcw3 ( 649211 )

            Claim means nothing. You go to their website, you make your purchase from them, and they deliver it. They are in fact a retailer no matter what they call themselves.

      • Many smaller retailers make use of payment processing centers to process credit card transactions.

        100% of my transactions involving a payment processor like Paypal or Adyen have listed in both the transaction confirmation and the bank statement for whom the payment was processed. Also it's not the payment processor who issues you a receipt. The receipt legally must be issued by the company making the sale for taxation purposes and have that company's tax information on it. Who processed the payment is irrelevant.

    • A lot of my credit card statement lines say âoePayPalâ. Does that mean that PayPal is the merchant of all those things?

    • I send my credit card company the money each month from my bank account. The credit card company in turn sends some of that on to Amazon, but I don't pay Amazon directly.

      There is a sense that a payment processor is different than a retailer. There is some complicated legal difference, but legislation can alter that arrangement significantly.

    • My credit card statement says "AMAZON.COM" for purchases from Amazon, vs "AMZN Mktp US" for marketplace sellers.

      The retail experience certainly feels like it's a sub-store on Amazon. The backend definitely makes technical distinctions, and the marketplace sellers are responsible for choosing what to stock, setting prices, etc. I don't think it fits neatly into either category.

    • Does anyone know how the law is applied to a brick-and-mortar store like Best Buy? If I buy an item from Best Buy and the item bursts into flames, is Best Buy held financially responsible for the safety of the item?

      • The equivalent would be if Best Buy let randos set up shop in a corner of their stores, and you paid Best Buy for the products, who in turn paid the randos. And sometimes BB employees would go in the back to fetch the products instead of the randos. You can bet your ass they would be liable.

      • Re:What is the law with brick-and-mortar stores? (Score:4, Informative)

        by cpt kangarooski ( 3773 ) on Saturday May 01, 2021 @11:51PM (#61337482) Homepage

        Yes.

        In the US products liability law is applied to all parties in the chain of manufacturing, distribution, and sale. The reasoning is that this is the best way to encourage said parties to design their products with an eye toward safety, to verify that they are indeed safe and free of defects that would cause harm, to monitor their performance in real life, and to effectively stop dangerous products from reaching consumers (as well as other users and even bystanders) who might be harmed by them. The parties in the chain are better positioned to protect public safety than individual members of the public are, and while a defective product could cause one person grievous and costly injuries or even cost them their life, it's more affordable and better overall to deal with the problem earlier on. Even if it makes the product slightly more expensive, better to spread that cost out among all buyers than to needlessly let random victims bear all the costs of perfectly avoidable injuries.

        So if you buy something at Best Buy and it burns you through some sort of defect, you can and should sue BestBuy and the distributor and the manufacturer. This will help push them to avoid having such things happen in the future. BestBuy will carefully vet its distributors and the products that are sold, the distributor will carefully vet the manufacturers and the products that are sold, and the manufacturers will be more careful.

        It's worked pretty damn well for decades. (But note that when you hear things about tort reform, it's people trying to dismantle this system because it is felt to be more profitable for some to make defective, dangerous crap even if there is a lawsuit from time to time than to do things right from the start)

        Amazon is pretty clearly selling products and should not be exempt. And ideally this will cause Amazon to resume only carrying goods that they've actually vetted.

    • Re: (Score:2)

      by mysidia ( 191772 )

      If the receipt or your card statement states "AMAZON", and it's Amazon that charged/took your payment, then it's Amazon that sold you the product.

      No. The retailer is the entity with whom the customer formed the contract with for the sale of goods. In other words, who had title to the goods before they were sold? The entity who did the work of presenting the offer and taking orders may be a service provider -- for example, take a website like eBay.... They help People sell stuff - buyers usually

      • Re: (Score:3)

        by Cederic ( 9623 )

        who had title to the goods before they were sold?

        That's not relevant.

        I walk into an art gallery, see a picture I like, hand over 40 quid for it. I bought that picture from the art gallery.

        They however never had title of that picture. Until I bought it, it belonged to the artist. I've never met the artist. I didn't agree a contract with them. I've given them no money.

        All the name on receipt means is payment was managed by Amazon

        No, the order confirmation says "Your Amazon.co.uk order of [item]" even though the item is sold by the manufacturing company via Amazon.

        Amazon think you placed an order on Amazon. You think y

    • Amazon has two roles, and they are actually pretty clear on the Amazon website. If they tell you that a product is "sold by Amazon", Amazon takes your money, and Amazon ships the product - they your contract is with Amazon. OTOH, if the product page says "available from these sellers" or "sold by Acme Birdseed", then - surprise - it's not Amazon doing the selling. IMHO the problem comes when they offer mixed models where Amazon keeps the product in their warehouses, handles shipping, and maybe even payment
    • In most cases Amazon would get away with that. I worked in and out of Ca doing contracts. And, they have to be very carefully written (against all the whining of suppliers) to ensure that the guy handing you the product knows that if anything goes wrong you are coming after him. Not relying on some wispery manufacturer's warranty. No YOU! That said, it is about darned time that a Ca court finally enforced Ca's strict liability clause. The Ca lawyers I worked with knew of it, but did not ever seriously

    • Re: (Score:1)

      by Xicor ( 2738029 )

      The problem here is that you shouldnt be able to even sue the retailer for a failed product... The only company you should be able to sue in this case is the manufacturer. Obviously they aren't suing the manufacturer because that's not where the money is. Let's say for the sake of argument that you buy a cell phone at best buy and it blows up, causing a house fire... you dont sue best buy for selling you a defective product... you sue samsung for making a defective product.

      Even in this case where the manufa

  • When buying through Amazon, there are three categories of transactions. First, obviously, is buying things where Amazon is the seller. Second is buying things where some other company is listed as the seller, but the items are stocked in Amazon warehouses and shipped by Amazon. Third is buying items that are shipped by the seller.

    So in the first case, clearly Amazon is the seller, and I don't think they could have contested that. In the second case, there is a slight disconnect, but it's really like buy

    • In the third case, though, it's very clear to the consumer that they're dealing with a third party. Amazon is never touching the merchandise, and only handling the finances and advertising. I would probably argue that this ruling shouldn't apply to those transactions.

      To make it really and truly clear to the consumer, they should say in big bold print we assume no responsibility for this merchandise, it may be total shit and that is solely your problem not ours. In red lettering with a big I accept button.

      • In red lettering with a big I accept button.

        Amazon didn't do this because that would require two clicks.

        More seriously, I like your idea. Buyer beware. What percentage of online shoppers do you think this would cause to weigh the odds?

        • Re: (Score:2)

          by k6mfw ( 1182893 )

          More seriously, I like your idea. Buyer beware. What percentage of online shoppers do you think this would cause to weigh the odds?

          A question I have is what if certain products that ONLY Amazon is the source to buy it? Many times when shopping online, Amazon always turns up on the first results of a search.

          I typically look for other places (I'm thinking the big B making enough profit already) but there are times when only source is Amazon. Or if not the only source, the only way to purchase it. Many other sites not as easy to complete purchase but some of these other sites are simply difficult (their purchasing page is all screwed up

          • I wanted to buy some programming for a car to enable european light functions in a US build, that was through Amazon. I reached out to the seller by email and said No Amazon. They said No Problem, Paypal and shipped ! Amazon is convenient, not necessary.

    • Re:Somewhat Agree (Score:5, Insightful)

      by fermion ( 181285 ) on Saturday May 01, 2021 @06:07PM (#61336922) Homepage Journal
      Amazon may stock and sell, the may take product on consignment, they may act as an agent, or they may be a payment processor. In most of these cases they may have liability selling a defective product.

      The issue that is going to haunt Amazon is they have single handedly created a market that potentially bypasses any reasonable safety protocol. They are either going to have develop or require government sanctioned standards or be open to such lawsuits.

      • Re: (Score:2)

        by crow ( 16139 )

        Would the same apply to eBay?

      • Somebody has to be responsible in the event of product recall. End of story. The trouble is if the importer is a $2 company /LLC with nothing behind it, with backstops. And as usual the retailer inherits the can, who stocked the item in bulk - usually a megatrend item popular for seasonal gifting, or impulse buys like a $3 toaster. However this went sour in Australia when the retailer went into insolvency as well (Bunnings and and the electrical mains cable who's insulation rotted quickly). Yep Chinese self
        • Correction: The Retailer was Masters Hardware stores - a smaller version of US style Hardware stores. A supermarket firm decided home renovation was a juicy area to get into (with no experience).

    • Re: (Score:2)

      by larwe ( 858929 )

      When buying through Amazon, there are three categories of transactions.

      Amazon does its very best to obfuscate this, though. And it is reflected in how people think about shopping there. You don't "go to Amazon Marketplace to look for a vendor selling a USB bird-feeder/hoverboard combo". You "buy it on Amazon". Amazon presents itself as a single unified storefront. Yes, any specific item of merchandise you order might have a different mix of how much of the transaction Amazon actually handles (payment processing, fulfilment, etc). But in fact, you might not even know what selle

  • Gotta agree with the court on this one (Score:4, Insightful)

    by Snotnose ( 212196 ) on Saturday May 01, 2021 @03:48PM (#61336622)
    Much as I love shopping on Amazon I've bought counterfeit stuff from them. Stuff I thought was the real deal that turned out notsomuch. They need to ensure what I buy is what I expect, not some crap I'd expect from wish.com.

    I understand these Chinese companies (they're always Chinese, right?) can drop a brand and open a new one in minutes. But should that be my problem?

    Hint: I'm not listed in the Forbes top 100^3 billionaires. I'm just a dude looking for underwear.
    • Comment removed based on user account deletion

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      If the company has it's own brand how can the stuff be fake?

      Most of the fake staff is domestic companies. Amazon isn't really good for Chinese ones, the fees are too high and shipping from China too slow.

      Amazon does little to stop them. If you get a fake be sure to get a refund. High levels of returns seem to be the primary way they detect fakes.

      • Most of the fake stuff is domestic companies simply carrying inventory from China to make fulfillment faster.

        • Re:Gotta agree with the court on this one (Score:4, Insightful)

          by AmiMoJo ( 196126 ) on Saturday May 01, 2021 @05:17PM (#61336824) Homepage Journal

          That's mostly what Amazon third party sellers are. The same stuff you get on eBay, but marked up to cover Amazon costs and shipped domestically, and passed off as genuine.

          On eBay the same item will be cheaper and marked as non-genuine. You will have to wait for it to come from China.

          • Yeah I have no problem at all buying stuff on eBay direct from Shenzhen and waiting a month or two for it. I also completely understand the warranty is zero miles or zero minutes, whichever come first.

            Amazon brings that stuff to you faster, which has a value. So long as everyone understands the warranty is the same it is all good.

            • I have no problem at all buying stuff on eBay direct from Shenzhen and waiting a month or two for it. I also completely understand the warranty is zero miles or zero minutes, whichever come first.

              That is not true. It is NOT "zero". It is "long enough to verify operation" due to eBay's terms and conditions — which specify that the item has to match the description. They can sell you something that doesn't work, but they have to say it doesn't work. Otherwise the item has to work on arrival. If it's DOA then you're covered by eBay's money back guarantee(tm).

              The seller may also offer additional warranty terms, but if they don't, then your protection is limited to the item working when it arrives.

              • Does anyone actually use that warranty? Pretty sure my credit cards give me coverage for defective merchandise as well, but I've never used that either.

                Of course none of the things I buy direct from China are very expensive. I think they count on the fact a lot of people just write off the occasional bad purchase.

                • I buy a lot of crap on eBay. Some of it doesn't work. I complain and I have always gotten my money back.

    • Re:Gotta agree with the court on this one (Score:5, Insightful)

      by nagora ( 177841 ) on Saturday May 01, 2021 @04:47PM (#61336764)

      Much as I love shopping on Amazon

      You are part of the problem. Stop giving Amazon money.

      • This, a thousand times. Please mod up! I do all my shopping on AliExpress. Oh wait...

        • Re: (Score:2)

          by nnull ( 1148259 )

          I stopped shopping for electronic stuff from Amazon. If I want something cheap and know what I'm getting, I'll go to AliExpress. But for the most part, everything has moved to B&H and back to Newegg.

          I mean, just look at desktop office PC's on Amazon. You're better off buying directly from the manufacturer. Almost all of them are models from 4 years ago being sold as brand new at full price on Amazon. They really don't care.

    • Re: (Score:3)

      by nnull ( 1148259 )
      If they can sue Harbor Freight for this nonsense and win, they can definitely sue Amazon for this nonsense.

  • This means that the quality of things bought online will be more verifiable.

    • and a bit more expensive of course, no more cheap crap prices.

      • If you need cheap crap prices, you can still go to Aliexpress or Alibaba...

        • Exactly. I want products as advertised, sold cheaply. I don’t want defective and substandard products lied about and sold to me for that same price.

          • Re: (Score:2)

            by nnull ( 1148259 )
            It's a good thing Harbor Freight is being sued to oblivion over this. Now it's Amazon's turn.
  • to come to this obvious conclusion?
  • Amazon's business model is going to be destroyed by this move. Why should they allow other companies to sell on their platform if they're going to be held responsible if the product fails?
    • No they won't, they'll just underpay their warehouse workers even more and saloomy would be there to suck of Bezos.

      • "...they'll just underpay their warehouse workers even more ..."

        Overworked, sure. But underpaid? :)

        "Let the wild rumpus start!"

  • Except for niche things, I only buy items from Amazon where Amazon is listed as the inventory source: "Ships from Amazon.com".
  • Which reminds me of the stories someone wrote about Acme's correspondences with him. :) https://www.amazon.com/ACME-Ca... [amazon.com] https://books.apple.com/us/boo... [apple.com] https://www.youtube.com/watch?... [youtube.com]

  • Of course the retailer is responsible, in fact, the retailer is supposed to enforce the UL standards and not sell power supplies that have not been tested by an ETL. I have purchased a counterfeit laptop power adapter from amazon. The problem is it says it was tested, after looking up the serial number and code they could not be found, and that power supply could do a few things. If I dropped it into water and came into contact with it, it could kill me. It could burn my house down. Why? because often the c

    • Re: (Score:2)

      by nnull ( 1148259 )

      Because our industry is now about cutting corners and getting away with it. Our lack of enforcement is our own undoing opening the gates to mass counterfeit products. When you have US Customs and Borders not doing their jobs like they're supposed too and not checking huge shipping containers marked as gift, you end up with this nonsense.

      It will get worse

  • Amazon itself is one giant dumpster fire (Score:3)

    by DrXym ( 126579 ) on Sunday May 02, 2021 @04:47AM (#61337764)
    Once upon a time they sold stuff which they themselves had purchased wholesale, presumably going through some measure of due diligence. Even if that due diligence was because good stuff sells better and doesn't get returned like faulty, broken, dangerous, or just poor quality crap.

    Now they're frontend for any shit that anyone wants to sell regardless of quality. Some searches result in a veritable sewer of OEM Chinese knockoff crap. Maybe Amazon would start applying a little more of that due diligence if the courts say they're legally responsible for a product they sell that ends up burning down someone's house, or causing a kid to choke to death or whatever it may be.

  • Amazon only one left to sue !!!

  • Does anyone here expect to buy something on Amazon which doesn't catch fire or give them lead poisoning? It's basically impossible to separate real from fake. It's basically impossible to determine if the seller is legit or some Chinese scammer.

    Amazon are great if you actually need something cheap and chinese like a crappy LCD display but don't want to wait for 3 weeks for shipping through ebay.

    • Re: (Score:2)

      by nnull ( 1148259 )
      They don't even offer good LCD's displays anymore. Almost all of them are overpriced and take forever to ship.

      • ? I got a nice 480x320 ILI9486 for $15 the other day and it arrived overnight.

        I wasn't talking about PC monitors or TVs.

  • Nothing Exclusive There (Score:4, Interesting)

    by speedlaw ( 878924 ) on Sunday May 02, 2021 @08:52AM (#61338124) Homepage
    After my account was hacked, and things arrived at my home charged to my card but oddly nowhere in my Amazon history, which could not be found by the offshore CSR-who claimed that nothing had been purchased-setting off a round of contested charges-fun times-and they didn't even want the items back (a shaver for a bald man and a neck hammock ??) I realized the convenience wasn't worth the security hole, the lack of response, and the fun of cancelling cards and getting new ones. Very little sold by Amazon is unique. Since closing my account (requires another set of CSR calls to non US locations), I have bought a lot of things on line. There are a lot of reasons to Avoid-the Union stance-the way they treat employees...they way they screw vendors by stealing ideas and coming up with house brands. A little searching will always find a WAY more deserving vendor for whatever you need....no need to pay Bezos a finder's fee.
  • Amazon--purveyor of cheap Chinese knockoffs of products sold on their platform by legitimate product developers.
  • Comment removed based on user account deletion

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