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The appeal court says that Amazon is responsible for third-party vendor's products



Amazon CEO Jeff Bezos visits the facility at the grand opening of the Amazon spheres, in Seattle, Washington, January 29, 2018.

Jason Redmond | Getty

A federal court of appeal decided that Amazon may be held liable for defective goods sold on the website of third-party vendors, which now account for more than half of its e-commerce revenue.

The decision on Wednesday, from a court in Philadelphia, reverses the court ruling at the bottom and may be significant to Amazon, who has been criticized for allowing counterfeit and dangerous items to sell through the platform.

Amazon has previously avoided liability for its suppliers' products. Last year, a Tennessee judge ruled that the company was not responsible for damage caused by a defective hoverboard that exploded, burning a family's house. The plaintiff, who purchased the product on Amazon's website, claimed that the company was not cautious about the hazards of the product.

The decision on Wednesday linked to a case where a Pennsylvania customer, Heather Oberdorf, bought a retractable dog slime on Amazon .com from a third-party provider, The Furry Gang. While walking on her dog in 201

5, Oberdorf was blinded after the band was suddenly withdrawn. Neither Oberdorf nor Amazon have been able to contact The Furry Gang.

"Amazon fails to take into account the fact that, under the agreement, third-party providers can only communicate with customers through Amazon," the ruling states. "This allows third-party vendors to hide from the customer so that customers are damaged by defective products without the direct use of the third-party vendor."

Amazon did not respond to a request for comment.

CEO Jeff Bezos speculated the growth of the market in his last letter to the shareholders, and wrote it, "To put it plainly: Third-party sellers are kicking our first lot of ass.

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