By: Erin Donnelly
Every month, over 197 million people visit Amazon.com, making the company the top e-commerce platform in the United States. In 2000, Amazon launched Marketplace, a platform which allows third-party retailers to list their products on the site. Many of these third-party retailers ship their products directly to consumers; they never pass through an Amazon warehouse and thus are not checked by company employees. Unfortunately, this has led to dangerous and defective products entering the market and the hands of Amazon consumers. For example, unsuspecting parents have used Amazon to unknowingly purchase knockoff car seatswhich did not meet federal regulations and ultimately endangered their children. The National Highway Traffic Safety Administration has regulations in place that require car seats to pass hundreds of tests before entering the market. Such agencies put consumer protection regulations in place for the public’s overall wellbeing, and risks arise when these standards are not met.
To its credit, Amazon has taken some steps to prevent counterfeit products from entering the market through its site. The company started Amazon Brand Registry, which helps businesses protect their intellectual property by providing tools to help protect their brands. Additionally, Amazon automatically scans its site and removes suspicious product listings and offers a fee-based service called Transparency, through which brands can add unique codes to products that are scanned by Amazon and by customers to confirm a product’s authenticity. Despite its efforts, however, Amazon falls short when it comes to preventing the listing of counterfeit products on its site.
Lawsuits inevitably arise when consumers receive defective or otherwise counterfeit products that they purchased through Amazon.com. There is an existing circuit split on the question of whether Amazon can be held liable under a products liability theory for the products that customers purchase from third-party retailers from its site. In Oberdorf v. Amazon.com Inc., the Third Circuit held that a customer may sue Amazon in such circumstances, concluding that Amazon could be considered a “seller” under Pennsylvania law because the company exerts considerable control over third-party sellers and can prevent the sale of unsafe items. Conversely, the Fourth Circuit in Erie Insurance Company v. Amazon.com, Inc. and the Sixth Circuit in Fox v. Amazon.com, Inc. each held that Amazon cannot be held liable under a products liability theory because it was not the actual seller of the defective products. In each of these cases, the court reasoned that because the company does not actually take title to the goods, Amazon was not liable despite the fact that the defective products were advertised and shipped by Amazon.
To protect its customers, Amazon should implement a more effective process for detecting and blocking the listing of counterfeit products and create processes to vet third-party retailers. If courts refuse to hold Amazon liable for the defective and dangerous products that are sold by third-party retailers through its site, it is unlikely that Amazon will be compelled to change its policies to prevent such occurrences.
 Emily Dayton, Amazon Statistics You Should Know: Opportunities to Make the Most of America’s Top Online Marketplace, Big Commerce, https://www.bigcommerce.com/blog/amazon-statistics/#10-fascinating-amazon-statistics-sellers-need-to-know-in-2020 (last visited Mar. 19, 2020).
 Matt Day & Jackie Gu, The Enormous Numbers Behind Amazon’s Market Reach, Bloomberg (Mar. 27, 2019), https://www.bloomberg.com/graphics/2019-amazon-reach-across-markets/.
 Pamela Boykoff & Clare Sebastian, Fake and dangerous kids products are turning up for sale on Amazon, CNN Business (Dec. 23, 2019), https://www.cnn.com/2019/12/20/tech/amazon-fake-kids-products/index.html.
 Lauren Gravitz, Knockoff car seats are infiltrating the market, and they could be deadly, Wash. Post (Nov. 5, 2019), https://www.washingtonpost.com/lifestyle/on-parenting/knockoff-car-seats-are-infiltrating-the-market-and-they-could-be-deadly/2019/11/04/46f8f7b2-fcab-11e9-ac8c-8eced29ca6ef_story.html.
 Boykoff & Sebastian, supra note 3.
 See, e.g., Oberdorf v. Amazon.com Inc., 930 F.3d 136 (3d Cir. 2019).
 Alexandra Berzon, Shane Shifflett, & Justin Schneck, Amazon Has Ceded Control of Its Site. The Result: Thousands of Banned, Unsafe or Mislabeled Products, Wall Street Journal (Aug. 23, 2019), https://www.wsj.com/articles/amazon-has-ceded-control-of-its-site-the-result-thousands-of-banned-unsafe-or-mislabeled-products-11566564990.
 Erie Insurance Co. v. Amazon.com, Inc., 925 F.3d 135 (4th Cir. 2019).
 Fox v. Amazon.com, Inc., 926 F.3d 295 (6th Cir. 2019).
 Alison Frankel, Amazon is (so far) winning its war against products liability exposure, Reuters (June 11, 2019), https://www.reuters.com/article/legal-us-otc-amazon/amazon-is-winning-its-war-against-products-liability-exposure-idUSKCN1TC2HY.
 Boykoff & Sebastian, supra note 3.