eBay Isn’t Liable for Selling Recalled Merchandise–Hinton v. Amazon

Photo credit: enameled house number two hundred and thirty // ShutterStock

Photo credit: enameled house number two hundred and thirty // ShutterStock

Due to Section 230, eBay generally isn’t liable when its merchants sell problematic goods. I believe the earliest ruling establishing this proposition is Stoner v. eBay, a 2000 case over bootleg recordings. More recently, in 2011, a court held that eBay wasn’t liable for personal injuries caused by merchandise purchased on eBay.

The latest attempt to hold eBay liable for the goods offered by its merchants claimed that eBay sold equipment subject to CPSC recalls. Like the other cases, this one goes nowhere. Last week, a Mississippi federal court granted eBay’s motion to dismiss (with prejudice) based on Section 230.

To get around the obvious Section 230 problem, the plaintiff argued that eBay violated criminal provisions of the Consumer Product Safety Act and thus the lawsuit fit into Section 230’s federal crimes exception. This argument was doomed from the outset. Numerous courts have held that Section 230’s federal criminal exclusion only applies to government prosecutions, not civil claims derived from criminal provisions. The court cites Doe v. Bates, Obado v. Magedson, MA v. Village Voice, Dart v. Craigslist and GoDaddy v. Toups. The court concludes “the Plaintiff’s beliefs regarding the illegality of eBay’s acts or omissions fail to trigger the statutory exception to CDA immunity.”

The plaintiff tried a half-hearted plead-around that eBay had a joint venture with the offending merchants. The court responds that “neither a website operator’s notice of the posting of potentially illegal content nor its receipt of profits from online sales controls the immunity determination under § 230” (including a cite to MA v. Village Voice).

The court admits that its “result may seem harsh or unfair” to the plaintiff. It says:

Plaintiff’s public policy arguments, some of which have appeal, are better addressed to Congress, who has the ability to make and change the laws. Further, nothing said here precludes the appropriate prosecuting authority from investigating and acting upon the Plaintiff’s allegations of criminal wrongdoing.

Better yet, please don’t. We’ve already seen how overexpansive criminal prosecutions of online marketplace operators can lead to troubling results.

Case citation: Hinton v. Amazon.com.dedc, LLC, 2014 WL 6982628 (S.D. Miss. Dec. 9, 2014). See the original state court complaint.