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Feds Sue Amazon over Unsafe Products from FBA Sellers

Feds Sue Amazon over Unsafe Products from FBA Sellers

A federal agency sued Amazon to force the recall of hazardous products sold on its platform. The administrative complaint is about protecting American consumers, according to the U.S. Consumer Product Safety Commission (CPSC). (See update to this story below.)

“Today’s vote to file an administrative complaint against Amazon was a huge step forward for this small agency,” said Acting Chairman Robert Adler. “But it’s a huge step across a vast desert – we must grapple with how to deal with these massive third-party platforms more efficiently, and how best to protect the American consumers who rely on them.”

The action is specific, impacting carbon monoxide detectors; children’s sleepwear garments; and hair dryers.

It refers to Amazon as a “distributor” of the products and seeks for Amazon to stop selling them, recall the products, and directly notify consumers who purchased them about the recall – and offer them a full refund.

Whether Amazon would fund those refunds or pass it along to FBA sellers is unclear.

Consumer Reports commended the CPSC for its action, but it also had concerns that it might cover “only a small portion of the potentially hazardous products that Amazon has manufactured, distributed, or sold.”

William Wallace, the manager of safety policy for Consumer Reports, said, “Through today’s action, the CPSC is seeking to hold Amazon legally responsible for safety recalls of third-party products offered to consumers on its platform—specifically, in this case, certain “Fulfilled by Amazon” products. Amazon has been the subject of dozens of state and federal product liability lawsuits, with mixed outcomes, in which the company has argued it bears little or no responsibility for the safety of products on Amazon that are offered by third-party sellers.”

He cited federal product safety laws passed in 1972 that gave the CPSC has the authority take proceedings that could lead requiring a company to take various actions – including destroying defective products in its possession.

Update 7/15/2021: An Amazon spokesperson provided us with the following statement:

“Customer safety is a top priority and we take prompt action to protect customers when we are aware of a safety concern. As the CPSC’s own complaint acknowledges, for the vast majority of the products in question, Amazon already immediately removed the products from our store, notified customers about potential safety concerns, advised customers to destroy the products, and provided customers with full refunds.

“For the remaining few products in question, the CPSC did not provide Amazon with enough information for us to take action and despite our requests, CPSC has remained unresponsive.

“Amazon has an industry-leading recalls program and we have further offered to expand our capabilities to handle recalls for all products sold in our store, regardless of whether those products were sold or fulfilled by Amazon or third-party sellers.

“We are unclear as to why the CPSC has rejected that offer or why they have filed a complaint seeking to force us to take actions almost entirely duplicative of those we’ve already taken.”

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.

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