United States District Court, W.D. Wisconsin
OPINION AND ORDER
D. PETERSON, DISTRICT JUDGE
Cain bought a bathtub faucet adapter from a third-party
seller on Amazon.com. The adapter malfunctioned and flooded
Cain's home, which was insured by plaintiff State Farm
and Casualty Company. State Farm paid to repair Cain's
home, and now it has sued Amazon.com, Inc. for strict product
liability under Wis.Stat. § 895.047. The question before
the court is whether Amazon can be held liable under
Wisconsin product liability law for a product sold by a third
party through Amazon.com.
moves for summary judgment on two grounds: (1) that it is not
a “seller” within the meaning of § 895.047;
and (2) that it cannot be held liable for third-party content
on its website because § 230(c)(1) of the Communications
Decency Act prohibits treating it as a
“publisher.” Dkt. 16.
court will deny the motion. Amazon does not merely provide a
marketplace where third-parties sell to Amazon customers.
Amazon was so deeply involved in the transaction with Cain
that Wisconsin law would treat Amazon as an entity that would
be strictly liable for the faucet adapter's defects, if,
as in this case, the manufacturer cannot be sued in
Wisconsin. And the Communications Decency Act does not
immunize Amazon because State Farm does not seek to impose
liability on Amazon merely because it posted some third-party
the court issued an order on July 10 telling the parties that
it was denying summary judgment, Dkt. 44, neither side
submitted any pretrial filings. Trial is scheduled for August
19, and the court is not moving the trial date. There is no
longer time for a full round of pretrial submissions and
responses, but the court will give the parties until July 30
to submit Rule 26(a)(3) disclosures, as well as all motions
in limine, proposed voir dire questions, proposed jury
instructions, and proposed verdict forms. The parties will
have until August 2 to submit responses. The court will rule
on any motions at the final pretrial conference on August 7.
following facts are undisputed unless noted.
Amazon.com, Inc. (which the court will refer to as simply
“Amazon”) operates the massive online retail
website Amazon.com. Amazon sells its own products on
Amazon.com, but it also allows more than a million
third-party sellers to use Amazon.com. This case involves one
of those third-party transactions.
October 2016, Luke Cain bought a swing-arm adapter for a
bathtub faucet listed on Amazon.com. Cain bought the product
from Amazon because he already pays for an “Amazon
Prime” subscription, which covers the cost of shipping
for many of the products sold on Amazon.com. Cain found the
adapter by visiting Amazon's website and searching for
the type of adapter he needed. Cain had seen the product
listing for the adapter on a section of Amazon's website
that displayed items “frequently bought
together.” Dkt. 35, ¶ 6.
adapter had been listed on Amazon.com by XMJ, a Chinese
company with no presence in the United States. XMJ found a
source for the product, acquired it, wrote the product
description, and offered it for sale on Amazon.com. Under the
terms of its contract with Amazon, XMJ was free to set the
price for the adapter, but the price had to be “at
least as favorable to Amazon Site users” as to anyone
else. Dkt. 19-2, § S-4. Amazon did not at any time own
the faucet adapter or any of XMJ's products.
provides payment processing for its third-party sellers.
Amazon also provides an “A to Z” guarantee for
items sold by third parties. This means that Amazon
guarantees both timely delivery of products sold by
third-party sellers and that the product will arrive in the
condition described on Amazon.com. Dkt. 19-4. If a product is
damaged, defective, or materially different than listed, the
buyer can ask the third-party seller for a refund. But if the
third-party seller does not respond, the buyer can return the
product directly to Amazon. Amazon will process the return
and refund the purchase price and cost of shipping.
also participated in the Fulfillment by Amazon (FBA) program,
through which Amazon managed the order-fulfillment process.
XMJ paid Amazon a fee to store its inventory at Amazon
fulfillment centers in the United States and to ship products
to buyers. For the FBA program, Amazon required XMJ to
register each product it would sell, and Amazon reserved the
right to refuse registration for any product, at Amazon's
discretion. Id., § F-1. Amazon also required
XMJ to indemnify Amazon for any injury or property damage
caused by XMJ products. Id., §§ 6, F-10.
When a customer purchased an XMJ product, Amazon would remove
the product from storage and ship it directly to the customer
in an Amazon-branded box.
case, Cain's purchase included the XMJ faucet adapter and
another product sold by Amazon itself. Amazon shipped the
products together in a single box. Amazon retained 30 percent
of the purchase price for the XMJ faucet adapter as a service
fee and sent the remainder to XMJ. About a month after the
purchase, Cain's home flooded due to a defect in the
adapter. Plaintiff State Farm, who had insured Cain's
home against property damage, paid for the repairs to
Cain's home caused by the flooding.
case requires the court to interpret the Wisconsin statute
relating to strict product liability in light of the enduring
effect of Wisconsin common law on the subject. The court
begins with a quick historical recap.
1967, Wisconsin embraced the emerging doctrine of
“strict product liability, ” according to which a
manufacturer can be held liable for a defective product even
without a showing of negligence or other fault on the part of
the manufacturer. Dippel v. Sciano, 37 Wis.2d 443,
155 N.W.2d 55 (1967). The strict product liability doctrine
is based on a policy determination that, even without a
showing of fault, it is appropriate to allocate the cost of
defective products to the manufacturer rather than the
injured party. The essential principles underlying the
doctrine are that the manufacturer can adjust the price of
the product to reflect the risks posed by the product and
that such cost-shifting will provide the manufacturer an
incentive to improve safety. Horst v. Deere &
Co., 2009 WI 75, ¶ 24, 319 Wis.2d 147, 769 N.W.2d
product liability in Wisconsin was a matter of common law,
with the strict liability doctrine patterned on § 402A
of the Restatement (Second) of Torts. In 2011, the Wisconsin
legislature passed a tort reform bill, which, among other
things, codified aspects of products liability law. 2011
Wisconsin Act 2, §§ 29-31 (creating Wis.Stat.
§ 895.045(3), § 895.046, and § 895.047). The
strict product liability doctrine was codified in Wis.Stat.
§ 895.047. Section 895.047(1) changed the applicable
standard for a defective product from the “consumer
expectation” standard in the Restatement (Second) of
Torts to the “reasonable alternative design” in
the Restatement (Third). The difference between these ...