A federal judge in New Jersey has ruled that Amazon.com cannot be held liable as the seller of a laptop battery that allegedly caught fire and destroyed the customer’s home. In a suit brought by a large national insurance company to recoup its losses from the fire, the judge found that Amazon can’t be considered a seller of the product under the New Jersey Product Liability Act because the company’s involvement in the sale was minimal.
According to the decision, the customer ordered the battery from Amazon’s Web site and Amazon’s name appeared on her credit card statement for the $12 purchase. The battery was shipped from an Amazon warehouse in Virginia, after an Amazon employee retrieved it from a shelf and prepared it for shipping – with a cardboard box and tape that both bore Amazon’s logo.
But, U.S. District Judge Freda Wolfson said Amazon never took ownership of the battery, which was sold by a Hong Kong company called E-Life that is not subject to service of process in the U.S.
The insurance company which brought the suit seeking to recover money it paid out in insurance claims on the fire, said Amazon met the definition of a seller under New Jersey’s products liability statute.
But Wolfson granted Amazon’s motion for summary judgment, finding it did not meet the definition of seller because it did not decide what product to sell; nor did it procure the product from the manufacturer or upstream distributor, or ensure that it complied with applicable laws.
Wolfson also noted that, under New Jersey’s strict products liability law, a consumer injured by a defective product can generally bring suit against any business entity in the chain of distribution. But despite the law’s broad language and its expansive interpretation by state courts, the reach of the Product Liability Act is not boundless. “Not every party involved in the distribution process can be classified as a ‘product seller,'” Wolfson said. She further went on to say that Amazon’s role was that of a facilitator rather than an ‘active participant.’
Amazon, she noted, “never exercised control over the product sufficient to make it a ‘product seller’ under the Product Liability Act. Amazon’s agreement with E-Life provides content for the product listing on the Amazon site, and Amazon did not control the price of the product, as the insurance company contented. Thus, “a buyer who purchases an E-Life product on Amazon is engaging in a transaction with the seller that Amazon is merely facilitating.”
