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Texas High Court Hears Debate Over Amazon Liability for Defective Products

Amazon argues it should not be considered a seller under Texas' products-liability law and is not at fault for a toddler’s injuries caused by a third-party product.

(CN) — In a case centered around a remote control battery swallowed by a 19-month-old child, attorneys for Amazon urged the Texas Supreme Court on Thursday to find that the nation’s largest online retailer cannot be held liable for defective products sold on its website by third parties.

The question of whether Amazon can be considered a seller when a consumer is injured by a dangerous product sold on its online marketplace has been wrestled with by courts across the country, with only a California appeals court finding against Amazon. But with the retail giant having lost its argument in the trial court, the Texas case has the potential for broad implications for online retailers.

“Amazon does not do any of the things that sellers do,” Brendan Murphy, a Seattle-based attorney for Amazon, said during Thursday's virtual hearing. “It doesn’t own the product, it doesn’t select the product, it doesn’t source it, it doesn’t offer it.”

The case began in 2018 after a 19-month-old child permanently injured her esophagus when she ingested a lithium button battery that popped out of a generic Apple TV remote control purchased on Amazon’s website.

While Amazon pulled the remote from its website and terminated the seller from its marketplace, the child’s mother, Morgan McMillan, sued the retailer months later for strict liability and negligence. She claimed the remote control was a Chinese knock-off void of any safety standards and that the battery’s caustic fluid from its electric charge caused irreversible damage to her toddler’s esophagus.

But because the battery was purchased from a third-party seller, China-based USA Shopping 7693, Amazon continued arguing on Thursday that it cannot be deemed the remote’s seller under Texas law. Murphy, part of Amazon’s legal team, said Amazon exercises control only over the service it provides, and that it is the third-party entities with a property ownership that are liable to consumers.

“And to the extent that the law should change, that is for the legislature to do,” Murphy said.

McMillan’s attorney, Jeff Meyerson, told the state’s highest court that Amazon was directly involved in the sale, and took the position that the online retailer “is engaged in the business of selling.”

“They’re here today claiming they’re immune from selling dangerous products in Texas because they’re not a seller, yet under Fulfillment by Amazon they’re performing every single function that a seller performs," Meyerson said. “All the supplier has to do is get the product to the shelf and then they sit back and wait for the check, Amazon does the rest.”

Meyerson said Amazon's product safety team seemed to be "asleep at the wheel" when he deposed a representative for the case and claimed that the same design of remote is still being sold on its website.

The case ended up in the Texas Supreme Court as a certified question after Amazon appealed a federal judge’s ruling that it could be held liable for the allegedly defective remote as a seller. Amazon appealed to the Fifth Circuit, but the appellate court found Amazon’s business model is new and asked the state Supreme Court for guidance since “there are no on-point Texas cases to guide us.”

The justices did not indicate when a ruling would be handed down, but most cases argued before the court are decided by late June.

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Categories / Appeals, Business, Personal Injury

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