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Amazon Is Liable for Third-Party Sellers’ Products, Court Says

Photo Credit: Robert Scoble via Flickr cc

A federal appeals court has ruled that Amazon is liable for defective goods sold on its site by third-party vendors. The ruling could have serious consequences for Amazon, since more than half of the e-commerce giant’s revenue comes from third-party vendors. Amazon has faced criticism for having counterfeits and dangerous items for sale on its platform.

“Amazon fails to account for the fact that under the Agreement, third-party vendors can communicate with the customers only through Amazon,” the ruling states. “This enables third-party vendors to conceal themselves from the customer, leaving customers injured by defective products with no direct recourse to the third-party vendor.”

Read more at CNBC.