Recent discussion in the Arizona Senate about legislation limiting product liability lawsuits to manufacturers rather than sellers is raising a lot of questions in legal and online retail circles. Today we want to take a deep dive into how this legislation might work, how third-party sales work on Amazon, and the responsibility all sellers have to consumers to provide safe products.
About Arizona SB 1092
Senate Bill 1092, deceptively called the Innocent Seller Protection Bill, aims to shield retailers and online sellers from liability when a defective product causes harm or injury. Under current state law, when an individual or group of people suffer injury from a dangerous product, they are eligible to file a product liability action against:
…a manufacturer or seller of a product for damages for bodily injury, death or property damage caused by or resulting from the manufacture, construction, design, formula, installation, preparation, assembly, testing, packaging, labeling, sale, use or consumption of any product, the failure to warn or protect against a danger or hazard in the use or misuse of the product or the failure to provide proper instructions for the use or consumption of any product.
Passage of SB 1092 would remove seller liability for just about any defective products they offer to consumers, except in cases where a seller has altered or modified a product, improperly repaired a product, or made an express warranty unauthorized by the manufacturer.
What does this mean for third-party sales on Amazon?
Even if you are a frequent Amazon shopper, you may be unaware of third-party sellers and the question of product liability. A recent New York Times (NYT) piece discusses a 2021 Supreme Court decision relieving Amazon from liability after a 19-month-old child suffered severe injuries from swallowing a loose battery. The battery fell out of a remote control the child’s parents purchased from Amazon, later found to have been fulfilled by a third-party merchant in China, who could not be located.
Per the NYT, “the Supreme Court of Texas ruled that Amazon was not liable for her injuries, because even if the company had listed, warehoused and delivered the remote control, it had not sold it.”
This may come as a surprise to consumers who believe companies like Amazon will provide protection in the event something they purchase for their family causes harm or injury. However, with third-party sellers, this may not be the case – “When you shop on Amazon, you are less likely to be buying something from Amazon than through it. More than 60 percent of physical goods bought on Amazon come from third-party sellers, Mr. Bezos told Congress in 2020.”
Amazon positions itself as a store that connects buyers and sellers, and also disclosed in 2019 that they “may be ‘unable to prevent sellers in our stores or through other stores from selling unlawful, counterfeit, pirated, or stolen goods,’ among other issues.”
Retailers have a responsibility to stand by the products they put on their shelves, as well as to ensure those products are safe. Further, this does not apply only to giant online stores like Amazon; this duty of care should apply to every party involved in the supply chain, including third-party sellers.
A responsibility to consumers
One of the three types of product liability classifications, in addition to design and manufacturing defects, is a marketing defect. A marketing defect can happen when a manufacturer OR seller fails to warn consumers about potential risks and hazards associated with a particular product. Under this theory, if a retailer is selling vitamin supplements with a known dangerous ingredient, the retailer can be held liable in the event a consumer experiences harm.
Arizona SB 1092 would remove this seller liability, allowing retail businesses to put potentially dangerous products on their real or virtual shelves without the worry of being held accountable if consumers suffer injuries. Our product liability and injury attorneys believe that – although companies have a duty to design and manufacture products that are safe for use and consumption – the buck does not only stop with them.
Sellers and retailers also have a responsibility to consumers to offer safe, reliable products that will not cause them harm. Passing legislation to relieve them of liability when defective products make it to the market will not cause fewer injuries; it simply passes blame around. Consumers need to trust that the stores and sellers from which they buy, whether the shop around the corner or a massive online box store, have vetted the products on their shelves for safety and quality.
If you or a loved one are injured by a defective product, it is crucial to understand all potential liable parties. Having experienced attorneys on your side to identify how the defect occurred, and which parties should be held responsible for your injuries and losses. Often in cases of third-party sellers, issues of liability can get complicated quickly, but a knowledgeable lawyer can help get to the bottom of your claim and guide you in the right direction.
At Plattner Verderame, PC, our product liability attorneys want to help if you or a loved one were harmed by a defective product. We work to identify all liable parties, hold them accountable for their negligence, and secure the financial compensation to which you are entitled for your injuries.
We handle these types of cases on a contingency fee basis, so there is no need to worry about upfront costs. You owe us nothing unless we obtain a verdict or settlement on your behalf. Call our office at 602-266-2002 or complete our contact form to schedule a free consultation today. We serve clients in Phoenix and Tempe.
I have been active in leadership in the Arizona Association for Justice (lawyers who represent injured folks, and formerly known as the Arizona Trial Lawyers Association) since 1985. I served as President in 1991. I was an active participant in battles to protect the Arizona Constitution from the insurance industry and big business interests in 1986, 1990 and 1994.
Read more about Richard Plattner