Why Amazon, Temu, Walmart, and Other Retailers Aren't Responsible for the Safety of Many Products on Their Websites

The companies often rely on outdated laws to shield themselves from liability. Here's what needs to change—and how to protect yourself.

Flammable children's pajamas. Carbon monoxide detectors that don't sound when the noxious gas is present. Hair dryers that lack a standard circuit breaker to reduce the risk of electrocution if they get wet.

If you purchase one of these products from a local brick-and-mortar store and someone is injured by it, the retailer can be held at least partially responsible.

But if you buy one on Amazon, Temu, Walmart.com, or another shopping website that lets outside vendors sell goods on their online marketplaces, they just might be off the hook.

The reason? These companies claim they're mere intermediaries in those transactions, like a delivery service, and therefore not liable. And some U.S. courts have agreed.

But a new report by Consumer Reports' safety advocates says these platforms are hiding behind outdated legal standards that took shape before online marketplaces existed and that need to be brought up to date.

U.S. product safety and liability laws were developed not only to compensate people who are harmed but also to incentivize everyone who plays a role in getting products to consumers to keep dangerous goods off the market. Consumer advocates say if online marketplaces aren't subject to these laws, that inducement goes away and consumers face a landmine of risk when they shop online.

"Our laws simply haven't kept up with the emergence of online marketplaces and, as a result, they aren't providing the legal and financial incentives for the companies to keep consumers safe," says CR manager of safety policy Oriene Shin, co-author of the organization's report. "That needs to change."

Whom Are You Buying From When You Shop Online?

Online shoppers might not even realize they're sometimes buying from a third-party vendor and not directly from a shopping website. But such sales are a large and growing portion of online commerce.

While Amazon, for example, does sell goods directly to consumers, about 60 percent of the products available on the site are listed by third parties—many of them using the company's Fulfillment by Amazon program, which includes everything from warehousing and shipping to customer service and return processing. Walmart, which launched its third-party platform in 2009, now hosts more than 150,000 outside vendors on its website. Target Plus, the retailer's third-party marketplace, reportedly offers 2 million products from about 1,200 brands. The fast-growing Chinese upstart Temu has made third-party sales its entire business model. And even brands you might not expect to be in this game, including Crate & Barrel, J.Crew, Kroger, Lands' End, and Urban Outfitters, have opened their online retail sites to third-party vendors in recent years.

At the same time, many online marketplaces have a clear quality control problem. Amazon sold 400,000 of those hazardous CO2 detectors, pajama sets and hair dryers between 2018 and 2021, as documented in an administrative complaint against the company by the Consumer Product Safety Commission. The CPSC's eSAFE team requested the removal of more than 50,000 recalled or illegal products from online commerce sites in 2023. Investigations by Consumer Reports , CNN , The Wall Street Journal , and other news organizations have previously discovered recalled, hazardous, and counterfeit goods on online marketplaces. And CR's most recent investigation found several types of dangerous infant sleep products —including baby loungers, inclined sleepers, and infant sleep positioners—that continue to be sold online despite widespread recalls, warnings, and rule changes regarding infant products marketed for sleep.

A Gaping Hole in the Product Safety System

If online marketplaces aren't legally responsible for such products, it leaves a gaping hole in the legal structures that evolved to broadly protect consumers, consumer advocates say.

One serious consequence is that injured parties sometimes can't collect product liability damages because many third-party sellers either don't have the money, are located outside the U.S. and can't be made to answer to U.S. law, or simply can't be found. In a Pennsylvania case , for example, a woman was blinded in one eye when a dog collar she purchased on Amazon broke and her retractable leash recoiled. She sued both Amazon and the third-party vendor, which called itself The Furry Gang, for damages. But investigators hired by both Amazon and the plaintiff were unable to locate the seller. (Amazon eventually settled the case before an appellate court could decide whether it was liable.)

But perhaps even more important, say consumer advocates and some legal experts, allowing online marketplaces to avoid liability would effectively eliminate the crucial incentive system that protects U.S. consumers. Traditional retailers have long been unambiguously liable for the safety of the products they sell, giving them a clear economic interest in doing all they can to ensure that the products they sell won't harm anyone. And whether they know it or not, consumers benefit from and depend on that self-interested behavior and the legal structure that underpins it.

"Our system is predicated on the idea that what's keeping products safe is the threat of tort liability," says New York University law professor Catherine Sharkey, who has written numerous s on the extension of product liability to online retail platforms. "It should worry people that [third-party marketplaces] are not subject to the same kind of legal regime that is governing brick-and-mortar stores."

Yet another concern is that the 1972 law that established the CPSC and charged it with protecting the public from unreasonable risks of product injury does not—even after multiple updates over the years—clearly give the commission jurisdiction over online marketplaces.

Why Marketplaces Say They Aren't Responsible

Online marketplaces have generally made two arguments about why they shouldn't be held legally responsible for goods sold by third parties. One relies on Section 230 of the Communications Decency Act of 1996, which protects online services from liability for the content their users generate. That means Facebook, for example, generally can't be blamed by someone who is defamed by a user on the social media site.

But in a California case in which a woman was allegedly burned by a faulty laptop battery , for example, Amazon argued that Section 230 should protect it from a product liability claim. A state appeals court ultimately disagreed, saying it was Amazon's role in getting the battery to the plaintiff that mattered, not the content of the product listing it published.

CR manager of safety policy Shin, who co-authored the new report, agrees with that decision. "Extending Section 230 protections to physical products sold online was never the intent of the law," she says.

The other key argument marketplaces use to fend off liability is that they don't "manufacture," "distribute," or "sell" products that third-party vendors market on their platforms, as those terms have traditionally been defined. Instead, they purport to be neutral intermediaries, like a delivery service or "logistics provider," which the law does not hold responsible for hazardous products.

Again, some courts have agreed with that argument. But a growing number of them, as well as some federal regulators, are rejecting it. In its July 2024 ruling about the pajamas, CO2 detectors and hair dryers, for example, the CPSC determined that Amazon is indeed a distributor under the relevant law, noting "Amazon's argument that it is merely a 'third-party logistics provider' misrepresents the far-reaching control Amazon exercises in its Fulfilled by Amazon program." (Amazon says it will appeal the decision.)

In the laptop battery case, the California appeals court emphasized Amazon's deep involvement in and control of the stream of commerce in deciding to hold it liable. Noting that the Fulfillment by Amazon program involves warehousing, packing and delivering products, conducting all communications with customers, receiving payment, handling customer service, and managing returns, the court dismissed the debate over terminology as beside-the-point semantics. "Whatever term we use to describe Amazon's role, be it 'retailer,' 'distributor,' or merely 'facilitator,' it was pivotal in bringing the product here to the consumer," it wrote.

What CR Wants to Happen

CR safety advocates say courts and policymakers should clarify any legal ambiguities that allow third-party marketplaces to escape liability, while taking into consideration the extent of a platform's control over the retail process.

At the same time, they acknowledge that a one-size-fits-all approach wouldn't be appropriate for all online marketplaces that host third-party sellers. They propose instead a kind of sliding scale of liability depending on how deeply a marketplace is involved in getting the product to the consumer, among other things. Factors that would go into that determination include whether the platform takes physical possession of the product, whether consumers clearly understand if they're doing business with the marketplace operator or with the third-party vendor, and the degree to which the marketplace curates or recommends products.

Under those guidelines, a peer-to-peer platform like Facebook Marketplace—where individual consumers typically sell used goods to one another—would likely incur less liability than platforms that offer sellers soup-to-nuts retail and distribution services like Walmart Fulfillment Services or Fulfillment by Amazon, Shin says.

All shopping platforms should nonetheless be held to certain basic standards, CR safety advocates say. These would include clearly indicating when a product is offered by a third-party vendor, making sure users can find complete and accurate information about the product, removing listings of all recalled or banned products, and quickly notifying customers if a product they previously purchased gets recalled.

In a statement to CR, CPSC Chair Alex Hoehn-Saric did not directly address CR's proposals but said that protecting consumers from hazardous products online will require marketplaces to prioritize safety and vigorously vet and monitor manufacturers and third-party sellers.

Amazon, Target, Temu, and Walmart were given an opportunity to comment on CR's proposals.

Amazon did not respond directly to CR's proposals, but in comments regarding CR's latest baby products investigation, the company said it requires all products on the site to comply with the law and that it is continuously working to prevent unsafe products from being listed and to quickly remove noncompliant products.

Target did not respond to multiple requests for comment.

Temu did not address the proposals directly but said consumer safety is a priority for the company and referred to its ongoing investments in systems designed to promote consumer safety.

Walmart did not respond directly to CR's proposals but, in comments regarding CR's latest baby products investigation, also pointed to its ongoing investments in "technology, people and the development of robust policies and processes to protect customers."

Indeed, numerous retail platforms have expanded their systems and processes intended to keep hazardous products off the market. In February 2024, for example, Amazon launched a safety "blueprint" which it says includes processes for vetting sellers, ongoing monitoring for unsafe products, and recall notifications. And in 2021 it extended what it calls its A-to-Z Guarantee , which includes a process for resolving personal injury or property damage claims caused by defective products, and a network of companies it says are willing to "offer liability insurance at competitive rates to qualifying sellers."

CR's Shin applauds such efforts but argues that updated standards are necessary nevertheless. "Hazardous products are finding their way into the marketplace, and product safety and liability laws have to protect consumers wherever they're shopping," she says. "Updated laws will also make sure that all platforms that host third-party sellers are playing on a level playing field with each other and with brick-and-mortar retailers."

"It comes down to who can control this risk, and Amazon already has all the tools and information to do that," says NYU law professor Sharkey. If the company is already doing more than others in this regard, she adds, "they should put their money where their mouth is."

How You Can Protect Yourself

Whether or not product safety and liability laws are updated, safety experts say consumers can minimize their risk by following a few basic guidelines.

Exercise greater care with higher-stakes items. Certain categories of goods merit extra caution. Those that should get the highest level of scrutiny include baby products, devices that use lithium-ion batteries, and anything that goes inside your body or comes into direct contact with your skin.

Understand who you're buying from. It's not always easy to tell who is selling a given product—and that's part of the broader problem CR is trying to address. But a little digging can often shed some light. You can identify the seller on Amazon product pages by looking directly below the "Add to Cart" and "Buy Now" buttons, where it lists the shipper ("Ships from") and the seller ("Sold by"). And you'll find that info a little farther down on the right-hand side of Walmart.com product pages, below the shipping options.

Buy from reputable sellers. Consider buying only products where the marketplace itself (such as Amazon or Walmart) is listed as the seller—because the platforms are unambiguously responsible for those products under current laws. If you're interested in a product listed by a third party, stick with well-known and reputable brands. If you haven't heard of one, do a Google search. One good sign is if you can find the exact same product on other major retail sites. Being unable to find a company website is a bad sign.

Check the reviews, but be skeptical. Negative customer reviews should put you on guard, especially if they include specific real-life details and/or multiple reviews identify similar problems. But keep in mind that fake and paid-for reviews, though illegal , are widespread. And know that designations like "Amazon's Choice" do not guarantee a product's safety.

Report suspicious products. If you see something that seems suspicious, or you spot a recalled, illegal, or hazardous product, alert the website and consider reporting it to the CPSC at SaferProducts.gov .

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