Texas Supreme Court to Decide if Amazon is Liable if Sellers’ Products Cause Injury

Recently, the U.S. Court of Appeals for the Fifth Circuit certified a question to the Texas Supreme Court asking for an interpretation of whether Amazon is a seller under Texas products liability law. If answered in the affirmative, Amazon is potentially liable for injuries caused by unsafe products sold by third parties on its website. However, if Amazon only facilitates the stream of commerce, then it is not a seller and injured consumers cannot sue Amazon for alleged product defects.

In the Texas case, the McMillan family sued Amazon.com and the third-party seller of a remote control after their 19-month-old daughter swallowed the battery of the remote control resulting in injuries to the toddler’s esophagus. The McMillans alleged several causes of action including strict liability for design defect, strict liability for marketing defect, breach of implied warranty, negligence, and gross negligence. The McMillans attempted to serve the third-party seller, but the Chinese entity did not appear or answer in the case. Amazon moved for summary judgment on the basis that it was not liable for any of the McMillans’ claims because, under Texas law, Amazon was not a “seller.” Although nonmanufacturing sellers are typically not liable for defective products, the Texas Products Liability Act provides an exception when the manufacturer of the product is not subject to the jurisdiction of the court. The district court denied summary judgment, concluding that Amazon was engaged in the business of placing the product in the stream of commerce. The district court certified its order for interlocutory appeal and the Fifth Circuit granted Amazon’s permission to appeal.

The Texas case is the most recent case involving the issue of whether Amazon is liable for injuries caused by a product sold by a third-party on its website. Courts in several other states have recently addressed this same question. The Texas Supreme Court’s decision will have potentially sweeping implications for online retailers such as Amazon.com.

If you or someone you know has been injured by a defective product, please contact an attorney at Abraham, Watkins, Nichols, Agosto, Aziz & Stogner by calling calling 713-231-9360 or toll free at 800-594-4884.