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The New “Web-Stream” of Commerce: Amazon and the Necessity of Strict Products Liability for Online Marketplaces

Posted by on Tuesday, January 26, 2021 in Notes, Volume 74, Volume 74, Number 1.

Margaret E. Dillaway | 74 Vand. L. Rev. 187 (2021) |

Technology company Amazon has actively transformed into an e-commerce giant over the last two decades. Once a simple online bookstore, Amazon now boasts an ever-expanding identity as global cloud computing provider, major player in artificial intelligence, brick-and-mortar grocery store, and producer of original video content. At its roots, the company remains focused on e-commerce—its multibillion-dollar online marketplace hosts a massive digital space for commerce worldwide where customers can order “anything, with a capital A.”

Amazon derives many of its sales from third-party vendors who list products on the company’s website, In this broadening chain of distribution for online retail, complicated tort issues arise in determining what entity should be held responsible when defective third-party products are sold to, and severely injure, consumers. Modern products liability law under the Restatement (Second) of Torts imposes strict liability on any seller of a defective product. Amazon has sought to avoid this liability by claiming it is not the seller but is instead a neutral platform that merely facilitates third-party sales. And until recently, courts have agreed.

Inspired by a handful of recent cases signaling a possible shift in U.S. products liability law, this Note proposes a statutory solution to hold online marketplaces such as Amazon to the same strict liability standards as brick-and-mortar retailers. This Note offers a statutory definition of “seller” that would extend liability to any party responsible for placing a defective product into the stream of commerce, providing a method of recourse for injured consumers that is not reliant on the courts.

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Margaret E. Dillaway