The U.S. Consumer Product Safety Commission (CPSC) unanimously ruled on July 30th that Amazon is accountable for dangerous or defective products sold by third-party vendors on its platform. The ruling categorizes Amazon as a “distributor,” thereby making the company legally responsible for recalling or destroying any hazardous items.

^{Defective Products Identified by the CPSC}

The CPSC’s announcement highlighted over 400,000 problematic products, including:

• Carbon monoxide detectors that fail to sound alarms
• Hairdryers lacking electrocution protection
• Highly flammable children’s pajamas

The agency criticized Amazon for not adequately informing the public about these risks or ensuring the return or destruction of the dangerous items. This negligence left consumers at significant risk of injury.

^{Marketplace Dynamics and Liability Dispute}

Earlier this year, Amazon disclosed that over 60% of its marketplace sales come from independent sellers. The legal battle over Amazon’s liability has been ongoing for more than three years. In 2021, the CPSC sued Amazon, accusing the company of distributing hazardous products and failing to take sufficient action.

Amazon has argued that it does not qualify as a distributor under the Consumer Product Safety Act and thus should not be held responsible for third-party products. Despite acknowledging the presence of hazardous items, Amazon maintained that it was not liable.

^{Legal Rulings and Amazon’s Response}

In a significant move, an administrative law judge ruled against Amazon, confirming that the company is a distributor and that its actions were insufficient to protect the public. This ruling criticized Amazon’s existing policy of merely warning customers about potential safety issues and offering Amazon credits.

Robert Adler, Acting Chairman of the CPSC in 2021, commented on the ruling, stating, “Today’s vote to file an administrative complaint against Amazon was a huge step forward for this small agency. We must grapple with how to deal with these massive third-party platforms more efficiently and how best to protect American consumers who rely on them.”

Company’s spokesperson expressed disappointment with the CPSC’s decision, announcing plans to appeal and emphasizing their prompt actions in notifying customers and providing refunds for the hazardous products identified three years ago.

^{Obligations and Consumer Safety}

As a result of the ruling, Amazon is now required to collaborate with the CPSC to develop plans for notifying consumers about the recalled products and removing them from the marketplace.

Consumer Reports praised the CPSC’s decision, with Oriene Shin, policy counsel for the advocacy group, stating, “This is clearly the right decision. There’s no good reason for a company to be exempt from these sensible requirements just because it hosts an online marketplace; otherwise, products that could injure or kill people might slip through the cracks. Consumers are affected either way and need the company to step up.”

Consumer Reports further urged Amazon to cease its legal battle and comply with the ruling to ensure consumer protection swiftly.