Products Liability Law Reporter

The Fifth Circuit Court of Appeals held that Amazon was not liable as a seller under Texas products liability law for third-party products sold on the company’s website and managed through the company’s Fulfillment by Amazon program.

Morgan McMillan’s husband purchased a remote control through Amazon.com, which listed the product’s seller as “USA Shopping 7693.” The remote was sold through Amazon’s Fulfillment by Amazon program. McMillan’s 19-month-old daughter ingested a button battery from the remote, and the battery became lodged in her esophagus. She required treatment at a hospital and suffered severe tissue damage to her esophagus.

McMillan sued Amazon, alleging strict liability design defect, marketing defect, breach of implied warranties, negligence, and gross negligence. The district court denied Amazon’s motion for summary judgment. The Fifth Circuit certified to the Texas Supreme Court the question of whether, under Texas products liability law, Amazon is a seller of third-party products sold on its website when it does not hold title to the product but controls the process of the transaction and delivers the product through the Fulfillment by Amazon program. The Texas high court held that potentially liable sellers are limited to those that relinquish title to a product at some point in the distribution chain. The court added that because third-party sellers do not relinquish title to their products, Amazon is not a seller of such products under Texas law.

Accordingly, the court held on interlocutory appeal that the district court’s conclusion that Amazon was a seller under Texas law should be reversed.

Citation: McMillan v. Amazon.com, Inc., 2021 WL 2660209 (5th Cir. June 29, 2021).