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CPSC Decision Labels Amazon a Distributor Who Must Handle Recalls of Products, Courts in U.S. Find Amazon Drivers are Employees Not Contractors
Amazon has faced several legal decisions changing the landscape for how they operate in the United States. Previously, Amazon has generally been successful is keeping its status as a third-party logistics provider for products that are warehoused at Amazon, shipped by Amazon, sold at the Amazon, site, but listed as sold by a third party. Amazon has also used third parties to supply many of its drivers, using contracts with other companies to supply delivery drivers for divisions such as Amazon Logistics.
CPSC Decision Amazon Is a Distributor
On July 30th, 2024 the Consumer Protection Safety Commission (CPSC) released an order regarding a case involving Amazon.com, Inc (CPSC Docket No.: 21-2). The case centered on the sale of hazardous products through Amazon’s platform.
Products included in the case include:
- Children’s sleepwear that violated federal flammability standards.
- Carbon monoxide detectors that failed to detect and alert for CO gas.
- Hair dryers lacking immersion protection, posing electrocution risks.
Amazon claimed it was a third-party logistics provider, and not a distributor. In previous product liability cases in many jurisdictions, the fact that Amazon will list a product on their website, collect payment for the product, warehouse the product, deliver the product, handle receipts for the purchase, and handle returns was still not sufficient to find it is a distributor. The CPSC disagreed, and found that Amazon has large control of the product and the sale and distribution process under its fulfilled-by-amazon service. Amazon is a distributor of the products, the CPSC concluded.
CPSC Decision – What Amazon Must Do Regarding Recalled or Dangerous Products
Based on the decision and order issued by the CPSC, these are the actions Amazon is required to take:
Immediate Cease of Distribution:
- Stop distributing the identified hazardous products.
- Notify all third parties to immediately cease the distribution of these products.
Notification and Public Announcements:
- Send two rounds of email notifications to the original purchasers of the hazardous products.
- Include the following in these notifications:
- Clear information about the product hazard.
- Instructions for stopping use of the product.
- Instructions for returning or safely disposing of the product.
- Post public recall notices in the following locations:
- Amazon’s product pages for the hazardous items.
- On each original purchaser’s Amazon.com page.
- On Amazon’s primary social media accounts (e.g., Facebook, Twitter).
Refunds or Replacements:
- Provide full refunds to consumers upon:
- Receipt of the hazardous product.
- Verification of the product’s destruction.
- In the case of carbon monoxide detectors, Amazon must offer replacements if the consumer returns the hazardous product.
Monitoring and Compliance Reporting:
- Submit Monthly Progress Reports to the CPSC, detailing the progress of the recalls for each of the three categories of products (children’s sleepwear, carbon monoxide detectors, hair dryers).
- Maintain records of all actions related to the recall, including consumer communications and refunds/replacements, for five years.
Consumer Incentives:
- Take steps to motivate consumers to remove the hazardous products from their homes. This may include:
- Offering refunds.
- Encouraging product returns.
- Offering incentives for product destruction.
Remedial Actions:
- Facilitate the destruction of any hazardous products that are returned to Amazon.
- Ensure compliance with the recall process by providing updated notifications and instructions for consumers to safely dispose of or return the products.
Public Safety and Monitoring:
- Provide the CPSC with ongoing updates to ensure all hazardous products are removed from distribution channels, including monitoring third-party sellers and participants in the “Fulfilled by Amazon” program.
These actions are designed to ensure that all hazardous products are safely removed from consumers’ hands and the marketplace, while Amazon takes responsibility for notifying affected parties and offering proper remediation.
If a product is fault and someone is injured, and Amazon is found to be a distributor, Amazon may face full product liability for the dangerous product and ensuing injuries.
Amazon Found Liable For Accident Injury in Georgia, Jury Awards $16 Million
In another court, this time in Georgia, Amazon was found responsible for an Amazon Logistics drivers accident, when a child was hit and seriously injured by a delivery van.
Amazon was found to have negligently trained the employee. Amazon claimed they were not an employee at all, but instead an employee of a contractor Amazon uses to staff their trucks. Amazon frequently uses delivery service partners, or DSPs, who in turn hire drivers. These drivers are considered by Amazon to not be their own employees, but contractors or employees of the smaller company they contract with. These drivers drive Amazon trucks, and deliver Amazon packages.
The jury in Georgia rejected this setup, concluding Amazon is responsible for the drivers and their accidents, and concluded Amazon had also failed to adequately train the driver. The jury concluded that Amazon maintains strict oversight over the routes the driver drives, develops the safety protocols used, and maintains performance metrics for drivers that would include the drivers need to maintain a certain pace of delivery.
The result is those injured by Amazon drivers may be able to recover from Amazon as well as any DSPs Amazon has contracted with to supply drivers.
Product Defect and Personal Injury Attorneys
If you believe you were subject to an injury due to a recalled product, or suffered an injury due to another driver including a delivery driver, we invite you to schedule a consultation with our consumer or personal injury attorneys. Schneider Wallace Cottrell Konecky LLP is a national law firm that represents injured consumers and individuals in a wide range of cases, including product defect and personal injury cases. Contact us at 1-800-689-0024.