390 F. Supp. 3d 964
W.D. Wis.2019Background
- Purchaser Luke Cain bought a bathtub-faucet adapter from third‑party seller XMJ through Amazon.com; Amazon handled payment, fulfillment (FBA), shipping in Amazon‑branded packaging, returns, and retained a service fee.
- The adapter leaked, flooding Cain’s home; insurer State Farm paid for repairs and sued Amazon under Wisconsin’s strict product liability statute, Wis. Stat. § 895.047.
- XMJ is a Chinese company with no presence in Wisconsin and the manufacturer is unknown and not subject to service in Wisconsin.
- Amazon never took title to XMJ’s goods but required product registration under FBA, could refuse listings, required indemnity from XMJ, and provided an “A to Z” guarantee and return/refund processing.
- Amazon moved for summary judgment arguing (1) it is not a “seller” under § 895.047 and (2) it is immune under Section 230(c)(1) of the Communications Decency Act for third‑party content.
- The court denied summary judgment, holding Amazon can be treated as a seller under Wisconsin law (given its FBA role) and § 230 does not bar State Farm’s strict‑liability claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Amazon is a “seller”/distributor under Wis. Stat. § 895.047 such that it can be strictly liable when manufacturer is unavailable | State Farm: Amazon’s substantial participation in sales (payment processing, storage, shipping, A‑to‑Z guarantee, returns, product listing among Amazon items) makes it a seller/distributor liable under Wisconsin law | Amazon: “Seller” requires transfer of title; Amazon never owned the goods and thus cannot be a seller | Court: Amazon is a seller for products sold through FBA because it functionally places products into the stream of commerce and is positioned to allocate risks; Wisconsin law does not require formal title transfer (Kemp precedent) |
| Whether CDA § 230(c)(1) immunizes Amazon from strict product liability for third‑party sales | State Farm: The claim targets Amazon’s role in placing a defective product into the stream of commerce (fulfillment, shipping, returns), not as publisher of third‑party content | Amazon: § 230 protects it from liability arising from third‑party product listings and descriptions | Court: § 230 does not bar the strict‑liability claim because State Farm’s theory is that Amazon sold/served as distributor of a defective good, not that it is liable as publisher of XMJ’s listing |
Key Cases Cited
- Dippel v. Sciano, 37 Wis. 2d 443 (Wis. 1967) (adoption of strict products‑liability doctrine)
- Kemp v. Miller, 154 Wis. 2d 538 (Wis. 1990) (lessor can be treated like seller; liability attaches to those who place dangerous instrumentalities into the stream of commerce)
- Fuchsgruber v. Custom Accessories, Inc., 244 Wis. 2d 758 (Wis. 2001) (statute does not abrogate common‑law rules absent clear intent; discussion of seller liability)
- Daniel v. Armslist, LLC, 386 Wis. 2d 449 (Wis. 2019) (CDA § 230 precludes claims treating a website as publisher when defendant’s role was only hosting third‑party ads)
- Erie Ins. Co. v. Amazon.com, Inc., 925 F.3d 135 (4th Cir.) (consideration of § 230 and seller‑liability issues for third‑party online sales)