LAW: Case 8.1 Fox v. Amazon.com, Inc., 930 F.3d 415 (6th Cir.) 2019

Facts: Plaintiffs are a family that resides in Davidson County, Tennessee. Defendant Amazon is a corporation that operates a worldwide online marketplace. Defendants marketplace facilitates the sale of products from itself and other sellers. W2M Trading Corp. (W2M) is a corporation that at one time was a third-party seller that utilized Amazons marketplace to sell hoverboards. Plaintiffs purchased a hoverboard and believed that Amazon-owned the hoverboard and that they purchased the hoverboard from Amazon. However, Defendants records show that W2M owned the hoverboard, and that Plaintiff purchased the hoverboard from W2M through Amazons marketplace. Defendant attempted to demand safety compliance documentation from third-party hoverboard sellers following initial reports of hoverboard fires and explosions. After research on hoverboards Defendant sent an email to all hoverboard purchasers that stated There have been news reports of safety issues involving products like the one you purchased that contain rechargeable lithium-ion batteries. As a precaution, we want to share with you some additional information about lithium-ion batteries and safety tips for using products that contain them. The email included a link for the information and safety tips, a link to initiate a return, and a request that the recipient pass along this information to the proper person if the hoverboard was purchased for someone else. After Amazon sent the email the hoverboard purchased by the Fox family caught on fire and burned down the familys house. The plaintiffs sued Amazon under the theories of violation of the Tennessee Consumer Protection Act (TCPA) and the theory of negligence.

Issues:

1. Does Amazon exercise sufficient control over a product in connection with its bailment and sale of hoverboards to place Amazon in the position to be responsible for product defects and associated injuries or losses under the TCPA?

2. Was Amazon negligent in its duty to warn Plaintiff about the defective or unreasonably dangerous nature of that product?

Legal Reasoning: A manufacturer or seller of a product may be liable for personal injury or property damage caused by that product if it was in a defective condition or unreasonably dangerous at the time it left the control of the manufacturer or seller. Tenn. Code Ann. 29-28-105(a). In addition, a seller is defined as any individual or entity engaged in the business of selling a product, including a retailer, wholesaler, or distributor, as well as a lessor engaged in the business of leasing a product and a bailor engaged in the business of bailment of a product. Tenn. Code Ann. 29-28-102(7).

Defendant sent email warning purchasers of the issues with hoverboards. The fact that Defendant assumed a duty to act raises a genuine issue of material fact regarding whether Defendant breached that duty and whether any breach caused Plaintiff's physical harm. For instance, there is a genuine issue of material fact regarding whether Defendants failure to include certain information in the December 12, 2015 email amounted to negligence.

Court Ruling:

1. Amazon did not exercise sufficient control over a product to assign them liability as a seller under the Tennessee Consumer Protection Act. Therefore, the Court of Appeals upheld the trial courts issuance of a summary judgment in favor of Amazon on the claim of violation of the TCPA.

2. The Court of Appeals reversed the trial courts issuance of a summary judgment in favor of Amazon on the tort claim because Amazon issued a warning to purchasers of the product that could be considered an assumption of duty.

Questions:

3. In order for Amazon to be negligent about the warning provided to customers they must have a duty, breach, direct cause, and damages relating to that duty to warn. Analyze these four elements regarding their warning to customers regarding hoverboards.