Eberhart v. Amazon.com, Inc.

Citation: 325 F. Supp. 3d 393Docket: 16-CV-8546 (JPO)

Court: District Court, S.D. Illinois; August 27, 2018; Federal District Court

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Jacob T. Eberhart filed a lawsuit against Amazon.com, Inc. for injuries sustained from a French press coffeemaker purchased online. In August 2015, while washing the coffeemaker, the glass pot shattered, causing lacerations to Eberhart's thumb, leading to nerve damage and potential long-term limitations. The primary legal question is whether Amazon, as the online marketplace, is liable for injuries caused by a product it did not manufacture or design. Eberhart argues that Amazon should be held responsible for selling the defective product, while Amazon contends it merely provides a platform for third-party sellers and cannot be held liable for their products.

Amazon moved for summary judgment, claiming there are no genuine disputes of material fact that would necessitate trial. The legal standard for granting summary judgment requires the movant to demonstrate there is no genuine issue for trial, with the burden shifting to the non-movant to provide specific facts showing otherwise. Eberhart alleges five causes of action against Amazon: strict products liability, negligence, vicarious liability, breach of express warranty, and misrepresentation, which are alternative theories of liability under New York law, as both parties have applied this jurisdiction in their arguments.

Amazon operates an online marketplace where it sells its own products and allows third-party sellers to offer their goods. Third-party sellers must agree to the "Amazon Services Business Solutions Agreement" (BSA), which outlines their responsibilities, including product selection, sourcing, pricing, and packaging. Sellers can opt into Amazon's "Fulfillment by Amazon" (FBA) program, which allows Amazon to store their products and handle shipping, although sellers maintain ownership and incur storage fees. The coffeemaker linked to Eberhart's injury was sold by a company called "CoffeeGet," which participated in the FBA program, meaning Amazon never took title to the product. Eberhart disputes CoffeeGet's role but provides no substantial evidence to support his claim. 

The legal question arises regarding whether online marketplaces like Amazon can be held strictly liable for products sold on their platforms. New York law holds manufacturers strictly liable for defective products without regard to privity or due care. While the Court of Appeals has extended strict liability to certain sellers, such as retailers and distributors, it has not definitively defined the distribution chain or clarified the role of online marketplaces within it. As such, the court seeks to predict how the New York Court of Appeals would address this issue, given the lack of precedent specifically applicable to online marketplaces.

The Court determined that Amazon does not qualify as a "distributor" of the coffeemaker subject to strict liability, as it did not take title to the product within the distribution chain. New York case law indicates that the term 'distributor' applies to entities that sell products, having purchased them from a manufacturer or another distributor. For instance, the Appellate Division in Spallholtz v. Hampton C.F. Corp. ruled that merely facilitating an exchange of a defective machine does not make a company a distributor. The requirement for ownership of the defective product is supported by the Restatement (Third) of Torts: Products Liability, which defines sellers and distributors as entities that own the products they distribute. Notably, the Restatement excludes "product distribution facilitators" from this definition. Although the Brumbaugh v. CEJJ, Inc. case imposed strict liability on a marketing agent without ownership, its applicability has been questioned in light of more recent rulings that emphasize the necessity of a chain-of-distribution requirement. The Finerty decision clarified that mere facilitation of distribution does not suffice for strict liability. The evidence presented does not support the conclusion that Amazon served as a necessary link in the distribution chain for the CoffeeGet coffeemakers.

Amazon is characterized as a provider of services rather than a distributor, which exempts it from strict products liability under New York law. The general rule states that if a defendant does not manufacture, distribute, or sell a product and primarily provides services, strict liability does not apply. Amazon's services include maintaining an online marketplace, warehousing and shipping goods, and processing payments, none of which qualify as activities that would impose strict liability. Case law supports this view, with several courts concluding that Amazon is not strictly liable for defective products sold on its platform. 

The excerpt notes relevant cases from various jurisdictions that consistently find Amazon does not fit the definition of a "seller" or "distributor," reinforcing the conclusion that it should not be held strictly liable. Consequently, Amazon is granted summary judgment regarding Eberhart's strict liability claim. Eberhart's additional negligence claims also fail, as a critical element of negligence is the existence of a duty owed by the defendant to the plaintiff, which is tied to the defendant's role in the sale or distribution of the product causing injury. Without evidence that Amazon sold or placed the product into the stream of commerce, Eberhart's claims do not succeed.

Amazon is not liable for negligence regarding the allegedly defective coffeemaker since it neither manufactured, sold, nor distributed the product to Eberhart. Citing legal precedent, the court notes that liability for negligence requires involvement in the design, manufacture, or sale of the product. Eberhart also failed to allege any negligent action by Amazon in relation to any service provided. Consequently, Amazon is granted summary judgment on the negligence claims. 

For claims of breach of express warranty and misrepresentation, Amazon successfully argued that it made no statements regarding the coffeemaker, which is essential for establishing liability in these claims. Under New York law, a breach of express warranty requires a material statement constituting a warranty, while fraudulent misrepresentation necessitates showing that the defendant knowingly made a false statement or omission. 

The court finds that Amazon is entitled to summary judgment on both warranty and misrepresentation claims. The motion for summary judgment is granted, and the case is directed to be closed. The court also establishes that subject matter jurisdiction is appropriate based on the parties' citizenship and the amount in controversy. The discussion includes references to the distribution chain and strict liability principles, emphasizing that only parties within the distribution chain can be held liable for defective products.

In Laurin Mar. AB v. Imperial Chem. Indus. PLC, it is established that a party not involved in the manufacturing, selling, or distribution of a product cannot be held liable for strict products liability or breach of warranty. This principle is supported by several cases, including Spallholtz v. Hampton C.F. Corp and Joseph v. Yenkin Majestic Paint Corp, which affirm that liability cannot extend beyond the defined chain of commerce. Furthermore, while the New York Court of Appeals has not fully adopted the Third Restatement of Torts, its principles have influenced New York law on strict products liability. Additionally, in cases such as Rivera-Emerling v. M. Fortunoff of Westbury Corp, the Appellate Division has referenced the Third Restatement favorably. Eberhart's attempt to hold Amazon liable for content posted by CoffeeGet on its platform is preempted by Section 230 of the Communications Decency Act, which states that no provider or user of an interactive computer service can be treated as the publisher or speaker of information provided by another content provider.