Client Alert: Texas Supreme Court Holds Amazon Not a “Seller” Of Third Party Products

On June 25, 2021, Texas joined a number of jurisdictions holding that Amazon is not a “seller” for purposes of Texas product liability law when it delivers third party goods using its Fulfillment by Amazon Program. This is a significant decision as it has sweeping implications for potential liability of online marketplaces that operate in Texas. The Court also clarified that one of two types of analyses is applicable to determining “seller” status under Chapter 82 of the Texas Civil Practice and Remedies Code (“Texas Product Liability Act”), distinguishing between “ordinary sales” and “non-sale commercial transactions” (e.g., bailments or leases). In cases involving ordinary sales, the Court held that an entity must hold or relinquish title to the product at some point in the distribution chain to be considered a “seller” under Texas law.