Amazon softens its position on third-party liability

On Behalf of | Aug 31, 2021 | Uncategorized

Millions of people in Illinois and around the country make purchases from Amazon every day, but they may not be aware that many of the products listed on the online retailer’s website are actually offered by third-party sellers. Amazon has built this lucrative part of their business by offering consumers quality assurances and money-back guarantees, but the company has long maintained that it is not responsible for injuries or financial losses caused by defective or dangerous products sold by its third-party sellers.

Product liability lawsuits

Amazon’s position has been supported by courts across the country when injured consumers have filed lawsuits after being injured by defective products. In March 2021, a federal court in Illinois ruled in favor of the online retailer in a case involving defective hoverboards sold by third parties that allegedly caused a housefire. The judge based his decision on the Business Solutions Agreement that Amazon requires third-party sellers to sign and the retailer’s terms and conditions, which state the company is not responsible or liable for the actions of third parties.

Amazon announces new policy

A court in California took a different view in 2020 when it ruled that Amazon could be held liable for injuries caused by products shipped using the Fulfillment by Amazon program even if they were sold by third parties. This may explain why the online retailer announced on Aug. 10 that it will pay up to $1,000 to consumers who suffer property damage or injuries caused by defective products sold by its third-party sellers. The retailer is also taking steps to ensure that its vendors have adequate product liability insurance. Issues with items sold by third parties account for about 80% of the injury and damage cases Amazon deals with each year.

Holding corporations accountable

Large corporations can prevail in trials but still lose in the court of public opinion if product liability lawsuits tarnish their reputations. This is a point that experienced personal injury attorneys could make vigorously during settlement negotiations when the defendants in these cases are reluctant to make an offer because they believe their arguments are legally sound.

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