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Illustration: Rebecca Zisser/Axios
A malfunctioning dog leash could end up creating billions of dollars of potential liabilities for online marketplaces, with Amazon front and center.
Background: A dog leash sold and shipped by The Furry Gang, one of the millions of small sellers that operate on Amazon’s marketplace, snapped, permanently blinding the buyer in her left eye.
- Amazon is responsible for the injury, according to a 2-1 decision from Philadelphia’s Third Circuit Court of Appeals.
- “Amazon’s involvement in transactions extends beyond a mere editorial function; it plays a large role in the actual sales process,” the opinion states.
Our thought bubble: This ruling challenges the company’s longtime practice of effectively outsourcing quality control to its customers and their reviews. Amazon could now be held liable for all the random things that get sold on its site.
What to watch: This isn’t just bad news for Amazon. The whole e-commerce sector — including companies like Walmart, eBay and Shopify — could come under fire.