Court says Amazon could be liable for third-party vendors' products

Amazon faced lawsuits over third-party sellers in the past, but it always came out unscathed. Now, though, a federal appeals court in Philadelphia has decided that the e-commerce giant can be held liable for products sold by third-party vendors doing business on its website. As Reuters noted, the decision could lead to an onslaught of lawsuits against Amazon from buyers who end up with defective products from sellers using the platform.

By siding with the plaintiff, the appeals court reversed a lower court's decision over a lawsuit filed by Heather Oberdorf, who was blinded when a retractable dog leash she bought from the website recoiled and hit her face. None of the parties involved in the lawsuit could get in touch with the vendor, The Furry Gang, which hasn't been actively selling since 2016.

Oberdorf's lawyer, David Wilk, said it feels "gratifying that the 3rd Circuit agreed with [their] argument and recognized that the existing interpretation of product liability law in Pennsylvania was not addressing the reality, the dominance that Amazon has in the marketplace."

While Amazon does have a first-party retail business, over half of the items it sells come from independent businesses. In 2018, Amazon's first-party sales amounted to $117 billion, which while nothing to sneeze at, is still much smaller than third-party sales that came in at $160 billion. It plays host to such a vast number of products that it can't even stop businesses from selling counterfeit products on its website.

We'll likely see a lot more lawsuits against the company, not only because of the Philadelphia appeals court's decision, but also because Amazon is bound to sell more and more independent businesses' products in the future. That said, Oberdorf's case still has to go back to lower court to determine whether the leash that blinded her was truly defective.