Filed 4/26/21

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION EIGHT

KISHA LOOMIS,

Plaintiff and Appellant,

v.

AMAZON.COM LLC,

Defendant and Respondent.

B297995

(Los Angeles County

Super. Ct. No. 

BC632830)

APPEAL from a judgment of the Superior Court of 

Los Angeles County. Ralph C. Hofer, Judge. Reversed and 

remanded with directions.

The Dolan Law Firm, Christopher B. Dolan, Dianna Albini, 

Megan Irish, Jill McDonell; Casey Gerry Schenk Francavilla 

Blatt & Penfield and Jeremy K. Robinson for Plaintiff and 

Appellant. 

Perkins Coie, Max L. Rothman and Brendan Murphy for 

Defendant and Respondent.

Fred J. Hiestand for The Civil Justice Association of 

California as Amicus Curiae on behalf of Defendant and 

Respondent.

________________________________
2

Kisha Loomis brought suit against Amazon.com LLC 

(Amazon) for injuries she suffered from an allegedly defective 

hoverboard. The hoverboard was sold by a third party seller 

named TurnUpUp through the Amazon website. The trial court 

granted summary judgment in favor of Amazon. The primary

issue on appeal is whether Amazon may be held strictly liable for 

Loomis’s injuries from the defective product. Recently, the 

Fourth District addressed this issue as a matter of first 

impression in Bolger v. Amazon.com, LLC (2020) 53 Cal.App.5th

431 (Bolger), review denied November 18, 2020. Bolger held 

Amazon “is an ‘integral part of the overall producing and 

marketing enterprise that should bear the cost of injuries 

resulting from defective products.’ ” (Id. at p. 453.) Our own 

review of California law on strict products liability persuades us 

that Bolger was correctly decided and that strict liability may 

attach under the circumstances of this case. We reverse and 

remand with directions.

I. FACTS

Loomis ordered a hoverboard on Amazon’s website on 

November 28, 2015. The listing identified the seller to be 

TurnUpUp, a name used by SMILETO to sell its products on 

Amazon’s marketplace. SMILETO is allegedly a company based 

in China. The hoverboard was shipped to Loomis by Forrinx 

Technology (USA), Inc. Loomis was notified by Amazon that the 

product shipped on December 1, 2015. On December 11, 2015, 

Loomis sent an e-mail inquiring whether the hoverboard would 

be delivered in time for Christmas. The e-mail was sent through 

Amazon’s website. Loomis received the hoverboard on December 

16, 2015. Loomis gifted the hoverboard to her son. On New 

Year’s Eve, he plugged it into an outlet in Loomis’s bedroom to 
3

charge. Loomis’s boyfriend later discovered a fire burning in her

bedroom. Her bed and the hoverboard were on fire. Loomis 

suffered burns to her hand and foot as a result of fighting the fire. 

A. Third Party Sales on Amazon.com

Amazon.com is an online marketplace where Amazon and

third party sellers list their products for sale. Amazon describes 

its marketplace as “an online mall” which provides an “online 

storefront” to third party sellers. Where Amazon is the seller of a 

product, it is identified as the seller on the product detail page,

and it sources the product, sets the price, and holds title to it. 

This case does not involve an Amazon-listed product. Where a 

third party is the seller, it is identified as such on the product 

detail page and again on the order confirmation page before the 

user places the order. The third party sources the product, sets 

the price, and holds title to it. 

All third party sellers operate under the Amazon Services 

Business Solutions Agreement (BSA). The BSA requires a seller 

to “ensure that [it is] the seller of each of [its] Products” and to 

provide Amazon with accurate, updated product information in a 

specified format. A third party seller chooses what products to 

sell and at what price. However, the BSA requires pricing parity, 

where the price is “at least as favorable to Amazon Site users as 

the most favorable terms” offered by the seller elsewhere. 

Amazon provides payment processing for all third party 

sales. It remits the purchase price to the third party seller on a 

set schedule minus any service fees it may charge. Amazon 

collects a “referral fee,” a percentage of the sale price per item 

sold by the third-party seller, depending on the nature of the item 

sold. For toys, such as hoverboards, the referral fee is 15 percent 

of the sale price. The seller is required to route all payments and 
4

refunds through Amazon, who may withhold payments, 

sometimes permanently, from the seller based upon its

investigation of any disputes or claims. Refunds due to 

purchasers are calculated by the seller according to Amazon’s 

refund policies and routed through Amazon. The BSA further 

required all communications between the seller and buyer to be 

made through Amazon. 

Under the BSA, Amazon expressly reserves the right to 

control of its website and listings: “We have the right in our sole 

discretion to determine the content, appearance, design, 

functionality and all other aspects of the Amazon Sites, including 

by redesigning, modifying, removing or restricting access to any 

of them, and by suspending, prohibiting or removing any listing.” 

The BSA also allows Amazon in its sole discretion to refuse to 

process or cancel any transactions. 

The seller must also ensure its materials, products, offers 

and sales comply with all applicable laws. The BSA advises third 

party sellers they are “responsible for any non-conformity or 

defect in, or any public or private recall of, any of [their] Products 

or other products provided in connection with [the] Products.” In 

addition to Amazon’s own efforts to monitor recalls, the BSA 

requires third party sellers to notify Amazon “promptly” of any 

public or private recalls of their products. 

Sellers also agree to indemnify Amazon from any liability 

arising from its products. For those sellers whose gross proceeds 

exceed a specified threshold, which was applicable to TurnUpUp, 

the BSA also requires them to acquire excess insurance naming 

Amazon as an additional insured. 

Some third party sellers utilize Fulfillment by Amazon 

(FBA) services, which allow the seller to store its inventory in an 
5

Amazon warehouse. If a product is sold under the FBA, Amazon 

packages and ships the product to the purchaser. TurnUpUp did 

not elect to utilize the FBA services.

Amazon provides purchasers with what it calls an “A-to-z

Guarantee:” “We want you to buy with confidence any time you 

make a purchase on the Amazon.com Website or use Amazon 

Pay. . . . The condition of the item you buy and its timely delivery 

are guaranteed under the unconditional A-to-z Guarantee.” 

Amazon, however, does not consider the A-to-z Guarantee to 

constitute a warranty for the products it lists. It instead warns

purchasers in its Conditions of Use that third parties sell 

products through Amazon and that Amazon is “not responsible 

for examining or evaluating, and [does] not warrant, the offerings 

of any of these businesses or individuals . . . . Amazon does not 

assume any responsibility or liability for the actions, product, and 

content of all these and any other third parties.” 

B. The Sale of Hoverboards on Amazon

More than 380,000 hoverboards were purchased through 

Amazon in 2015. The vast majority were sold by third party 

sellers. Under the BSA, Amazon charged TurnUpUp various fees 

for its services, including a $39.99 monthly nonrefundable

subscription fee and a 15 percent referral fee that was calculated 

from the total sales price of each product. For the transaction at 

issue, Amazon received a referral fee of $55.50 from the $370 sale

of the TurnUpUp hoverboard to Loomis. For the period between 

September 14, 2015, and December 16, 2015, TurnUpUp sold 

hoverboards totaling $736,366.68 through Amazon. Amazon 

received $110,645.92 in fees from those sales. 

In late November 2015, Amazon’s product safety team 

began investigating hoverboards in response to press reports that 
6

hoverboards were involved in fires. It identified 17 reports of fire 

or smoke allegedly caused by hoverboards sold through Amazon. 

These 17 reports involved different models and manufacturers. 

On December 10, 2015, Amazon decided to remove all third 

party hoverboard listings from its website. It sent all prior 

hoverboard purchasers an e-mail notifying them of the reports of 

safety problems with hoverboards. Loomis testified in her 

deposition she did not recall receiving such an e-mail from 

Amazon. 

During this time, the Consumer Product Safety 

Commission (CPSC) conducted its own investigation into 

hoverboard safety and was in contact with Amazon about it. On 

February 18, 2016, the CPSC issued a letter stating that it 

regarded hoverboards that do not comply with a draft 

Underwriters Laboratories voluntary standard as presenting a 

potential “substantial product hazard.” The CPSC announced 

recalls of certain hoverboard models in July 2016. 

C. The Legal Proceedings

Loomis brought suit against Forrinx1 and Doe defendants 

for products liability and fraud on September 2, 2016. In a form 

complaint, Loomis alleged three “counts” related to the product

liability cause of action. Count one alleged strict products

liability, count two alleged negligence, and count three alleged a 

breach of warranty. Loomis later amended her complaint to 

substitute Amazon into the lawsuit for a Doe defendant. 

Amazon moved for summary judgment on a number of 

grounds, including that it did not fall within the chain

1 Forrinx failed to appear and a default was entered against 

it.
7

of distribution for product liability purposes, it could not be liable 

under the “marketing enterprise theory” for those entities that 

fell outside the chain of distribution, and the federal 

Communications Decency Act (47 U.S.C. § 230) (CDA) barred 

Loomis’s claims.2 The trial court granted Amazon’s motion for 

summary judgment. Loomis timely appealed.

II. DISCUSSION

At issue in this appeal are Loomis’s strict and negligent 

product liability claims.

3 She contends summary adjudication

was improperly granted due to Amazon’s participation in the 

vertical chain of distribution for the product. Amazon disclaims 

any liability on the ground it is neither a manufacturer nor seller 

of the hoverboard. We conclude there exist triable issues of 

2 Under the CDA, “[n]o provider or user of an interactive 

computer service shall be treated as the publisher or speaker of 

any information provided by another information content 

provider.” (47 U.S.C. § 230 (c)(1).) “No cause of action may be 

brought and no liability may be imposed under any State or local 

law that is inconsistent with this section.” (Id., (e)(3).)

3 Loomis acknowledges her fraud claim (second cause of 

action) and breach of warranty claim (count three of the first 

cause of action) are not at issue in this appeal. In the 

respondent’s brief, Amazon informed us that we need not 

address its CDA-based arguments as “[Loomis] has abandoned 

her fraud claim and frames her remaining claims as based solely 

on Amazon’s role in the transaction, not on the website’s content.”

We understand this statement to mean Amazon concedes the

CDA only applied to shield it from Loomis’s fraud claim and not 

her strict liability and negligence claims. Accordingly, we agree 

we need not address whether the CDA provides immunity to 

Amazon from the strict liability and negligence claims. 
8

material fact which warrant reversal of summary adjudication as 

to these claims.4

A. Standard of Review

A defendant moving for summary judgment must show 

that one or more elements of a cause of action cannot be 

established or that there is a complete defense to the cause of 

action. (Code Civ. Proc., § 437c, subd. (p)(2); Miller v. Department 

of Corrections (2005) 36 Cal.4th 446, 460.) Once the defendant’s 

burden has been met, the plaintiff is required to show a triable 

issue of material fact as to the cause of action or defense. (Code 

Civ. Proc., § 437c, subd. (p)(2).) A triable issue of fact is created 

when the evidence reasonably permits the trier of fact, under the 

applicable standard of proof, to find the purportedly contested 

fact in favor of the party opposing the motion. (Lugtu v. 

California Highway Patrol (2001) 26 Cal.4th 703, 722.) The 

plaintiff may not rely on the allegations in her pleadings but 

must set forth the specific facts showing the triable issue. (Code 

Civ. Proc., § 437c, subd. (p)(2).)

We review the record de novo, considering all the evidence 

set forth in the moving and opposing papers except that to which 

4 Loomis also contends her claim for punitive damages 

survives summary adjudication because her products liability 

claims do. Amazon does not address this issue in its respondent’s 

brief. Below, it sought summary adjudication of punitive 

damages on the ground Loomis had no viable underlying claims 

to support it. It presented no argument as to the merits of the 

claim. Loomis is correct that a punitive damages award may

properly be entered in a strict products liability suit. (Grimshaw 

v. Ford Motor Co. (1981) 119 Cal.App.3d 757, 807-808, 

disapproved on a different ground by Kim v. Toyota Motor Corp.

(2018) 6 Cal.5th 21.) 
9

objections were made and sustained. We liberally construe the 

evidence in support of the plaintiff opposing summary judgment 

and resolve doubts concerning the evidence in her favor. (Code 

Civ. Proc. § 437c, subd. (c); Yanowitz v. L’Oreal USA, Inc. (2005) 

36 Cal.4th 1028, 1037; AARTS Productions, Inc. v. Crocker 

National Bank (1986) 179 Cal.App.3d 1061, 1064–1065.)

B. The Doctrine of Strict Products Liability in 

California

Greenman v. Yuba Power Products, Inc. (1963) 59 Cal.2d 

57, 62 (Greenman) established the doctrine of strict products 

liability when it held “[a] manufacturer is strictly liable in tort 

when an article he places on the market, knowing that it is to be 

used without inspection for defects, proves to have a defect that 

causes injury to a human being.” “The purpose of such liability is 

to insure that the costs of injuries resulting from defective 

products are borne by the manufacturers that put such products 

on the market rather than by the injured persons who are 

powerless to protect themselves.” (Id. at p. 63.)

The California Supreme Court extended the doctrine to 

retailers in Vandermark v. Ford Motor Co. (1964) 61 Cal.2d 256

(Vandermark), reasoning, “Retailers like manufacturers are 

engaged in the business of distributing goods to the public. They 

are an integral part of the overall producing and marketing 

enterprise that should bear the cost of injuries resulting from 

defective products. [Citation.] In some cases the retailer may be 

the only member of that enterprise reasonably available to the 

injured plaintiff. In other cases the retailer himself may play a 

substantial part in insuring that the product is safe or may be in 

a position to exert pressure on the manufacturer to that end; the 

retailer’s strict liability thus serves as an added incentive to 
10

safety. Strict liability on the manufacturer and retailer alike 

affords maximum protection to the injured plaintiff and works no 

injustice to the defendants, for they can adjust the costs of such 

protection between them in the course of their continuing 

business relationship.” (Id. at pp. 262-263.)

California courts must consider the policies underlying the 

doctrine to determine whether to extend strict liability in a 

particular circumstance. (Anderson v. Owens–Corning Fiberglas 

Corp. (1991) 53 Cal.3d 987, 995 (Anderson); O’Neil v. Crane Co. 

(2012) 53 Cal.4th 335, 362–363 (O’Neil).) The public policies 

articulated in Greenman and Vandermark that form the 

foundation for the application of strict liability are the following: 

(1) whether Amazon may play a substantial part in insuring that 

the product is safe or may be in a position to exert pressure on 

the manufacturer to that end, (2) whether Amazon may be the 

only member in the distribution chain reasonably available to the 

injured plaintiff, and (3) whether Amazon is in a position to 

adjust the costs of compensating the injured plaintiff amongst 

various members in the distribution chain. (Vandermark, supra, 

61 Cal.2d at pp. 262-263.)

Applying these policy considerations, courts have extended 

strict products liability to entities within the chain of 

distribution, including bailors and lessors (Price v. Shell Oil 

Company (1970) 2 Cal.3d 245, 248); wholesalers and distributors 

(Barth v. B. F. Goodrich Tire Co. (1968) 265 Cal.App.2d 228, 252-

253; Canifax v. Hercules Powder Co. (1965) 237 Cal.App.2d 44, 52

(Canifax)); and sellers of mass-produced homes (Kriegler v. 

Eichler Homes, Inc. (1969) 269 Cal.App.2d 224, 227). Courts 

have found these defendants were responsible for passing the 

product down the line to the consumer, had the ability to affect 
11

product safety by exerting pressure on the manufacturer, and 

were able to bear the cost of compensating for injuries. (Arriaga

v. CitiCapital Commercial Corp. (2008) 167 Cal.App.4th 1527, 

1535 (Arriaga).) Courts, however, have declined to extend the 

doctrine to hotel proprietors (Peterson v. Superior Court (1995) 10 

Cal.4th 1185); sellers of used products (Wilkinson v. Hicks (1981) 

126 Cal.App.3d 515); and auctioneers (Tauber–Arons Auctioneers 

Co. v. Superior Court (1980) 101 Cal.App.3d 268 (Tauber-Arons)), 

who were found to have little to no relationship with the 

manufacturer and thus lacked the ability to affect product safety. 

A consumer injured by a defective product “may now sue 

‘any business entity in the chain of production and marketing, 

from the original manufacturer down through the distributor and 

wholesaler to the retailer; liability of all such defendants is joint 

and several.’ ” (Wimberly v. Derby Cycle Corp. (1997) 56 

Cal.App.4th 618, 628.) The purpose for this approach “is to 

extend liability to all those engaged in the overall producing and 

marketing enterprise who should bear the social cost of the 

marketing of defective products.” (Kaminski v. Western 

MacArthur Co. (1985) 175 Cal.App.3d 445, 455-456.) 

“The strict liability doctrine derives from judicially 

perceived public policy considerations, i.e., enhancing product 

safety, maximizing protection to the injured plaintiff, and 

apportioning costs among the defendants. [Citations.] Where 

these policy justifications are not applicable, the courts have 

refused to hold the defendant strictly liable even if that 

defendant could technically be viewed as a ‘ “link in the chain” ’ 

in getting the product to the consumer market. [Citation.] In 

other words, the facts must establish a sufficient causative 

relationship or connection between the defendant and the product 
12

so as to satisfy the policies underlying the strict liability 

doctrine.” (Arriaga, supra, 167 Cal.App.4th at p. 1535.)

The court in Bay Summit Community Assn. v. Shell Oil Co.

(1996) 51 Cal.App.4th 762 (Bay Summit), set forth three factors 

to determine whether such a causative relationship or connection

exists when the defendant falls outside the vertical chain of 

distribution. Under the marketing enterprise theory or stream of 

commerce approach, the plaintiff must show: “(1) the defendant 

received a direct financial benefit from its activities and from the 

sale of the product; (2) the defendant’s role was integral to the 

business enterprise such that the defendant’s conduct was a 

necessary factor in bringing the product to the initial consumer 

market; and (3) the defendant had control over, or a substantial 

ability to influence, the manufacturing or distribution process.”

(Id. at p.776; Kasel v. Remington Arms Co. (1972) 24 Cal.App.3d 

711 (Kasel).) 

C. Bolger v. Amazon.com LLC

In Bolger, the Fourth District applied strict products

liability analysis to substantially identical facts as presented in 

this case. There, the plaintiff bought a replacement battery for 

her laptop from a third party seller through the Amazon website. 

The battery allegedly exploded several months later, causing 

severe burns. (Bolger, supra, 53 Cal.App.5th at p. 437.) The trial 

court granted summary judgment in favor of Amazon on the 

ground it did not distribute, manufacture, or sell the product in 

question. The Fourth District reversed. (Id. at p. 439.)

The Bolger court found Amazon was “a direct link in the 

chain of distribution, acting as a powerful intermediary between 

the third party seller and the consumer.” (Bolger, supra, 53 

Cal.App.5th at p. 438.) “As a factual and legal matter, Amazon 
13

placed itself between [the seller] and Bolger in the chain of 

distribution of the product at issue here. Amazon accepted 

possession of the product from [the seller], stored it in an Amazon 

warehouse, attracted Bolger to the Amazon website, provided her 

with a product listing for [the seller’s] product, received her 

payment for the product, and shipped the product in Amazon 

packaging to her. Amazon set the terms of its relationship with 

[the seller], controlled the conditions of [the seller’s] offer for sale 

on Amazon, limited [the seller’s] access to Amazon’s customer 

information, forced [the seller] to communicate with customers 

through Amazon, and demanded indemnification as well as 

substantial fees on each purchase. 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.” (Ibid.) 

After concluding Amazon was a link in the chain of 

distribution, the Bolger court found the policies articulated in 

Greenman, Vandermark, and their progeny supported imposition 

of strict liability. The court found Amazon was the only member 

of the enterprise reasonably available to an injured consumer in 

some cases, it played a substantial part in ensuring the products 

listed on its website were safe, it could and did exert pressure on 

upstream distributors like the instant seller to enhance safety, 

and it had the ability to adjust the cost of liability between itself 

and its third party sellers. The court concluded Amazon should 

be held liable if a product sold through its website turned out to 

be defective, since strict liability in the instant case afforded 

maximum protection to the injured plaintiff and worked no 

injustice to Amazon. (Bolger, supra, 53 Cal.App.5th at pp. 453-

455.)
14

In Bolger, Amazon presented many of the same arguments 

to disclaim liability as it does in this case. (Bolger, supra, 53 

Cal.App.5th at pp. 455-458.) The court rejected each of these 

arguments. 

Amazon initially focused on dictionary or Commercial Code 

definitions of “seller” and “distributor” to argue those definitions 

did not apply to it. It asserted it was a service provider that was 

not subject to strict liability and that had no control over the 

selection of the product or its pricing. (Bolger, supra, 53 

Cal.App.5th at p. 456.)

The court explained strict products liability was created 

judicially because of the economic and social need for the 

protection of consumers in an increasingly complex and 

mechanized society. The scope of strict liability was expanded 

when necessary to account for market realities and to cover new 

transactions, such as this one, in widespread use in today’s 

business world regardless of labels or dictionary definitions. 

(Bolger, supra, 53 Cal.App.5th at p. 456.)

The court rejected Amazon’s assertion it was merely a 

service provider with no control over the product. It held,

“Nothing aside from Amazon’s own choices required it to allow 

[the seller] to offer its product for sale, to store [the seller’s]

product at its warehouse, to accept Bolger’s order, or to ship the 

product to her. It made these choices for its own commercial 

purposes. It should share in the consequences.” (Bolger, supra, 

53 Cal.App.5th at p. 457.) The court concluded Amazon’s control 

over both the product and the sales transaction formed the basis 

for its liability. (Id. at pp. 458-459.)

Additionally, Amazon argued, as it does here, that the 

Legislature, not the court, was the appropriate forum to address 
15

whether those policies would be served in new contexts. The 

Bolger court found this argument ran “directly contrary to 

California law” on strict liability, which was created by the courts

and expanded and contracted where warranted by its purposes. 

(Bolger, supra, 53 Cal.App.5th at p. 459.)

Lastly, the court found the federal CDA did not shield 

Amazon from strict liability because liability was based on 

Amazon’s own conduct, not the content of the seller’s product 

listing. (Bolger, supra, 53 Cal.App.5th at p. 465.) 

Amazon contends Bolger was erroneously decided because 

it ignores long-standing limitations on strict liability law. 

According to Amazon, these long-standing limitations include a

“threshold requirement” for strict liability expressed in O’Neil

and case law excluding service providers from strict liability. We 

explain below (post, sec. D,3) how Amazon has misinterpreted 

O’Neil and the cases regarding liability of service providers. 

We are also not persuaded by Amazon’s argument that 

Bolger improperly applied strict liability to “facilitators.” 

Amazon argues, “Before the Fourth District’s Bolger decision, the 

lower courts uniformly . . . rejected claims against service 

providers that facilitated, or were even necessary to consummate, 

sales.” In each of those cases, however, the courts did not refuse 

to impose strict liability simply because the defendant facilitated 

a sale. The courts each examined the underlying policies and 

determined strict liability as to finance lessors and auctioneers 

was not appropriate. (Arriaga, supra, 167 Cal.App.4th at p. 1537

[“The policy considerations behind imposing strict products 

liability on those involved in the vertical distribution of consumer 

goods are not furthered by including finance lessors.” (Italics 

omitted.)]; Tauber-Arons, supra, 101 Cal.App.3d at p. 274 [“The 
16

real issue in this case is whether the policy of the doctrine of 

strict liability established by the decisions of the appellate courts 

in this state justifies the imposition of strict liability under such 

circumstances.”]; Brejcha v. Wilson Machinery, Inc. (1984) 160 

Cal.App.3d 630 [relying on Tauber-Arons].) 

Amazon next criticizes Bolger for relying on “vague and illdefined policy notions” that were “cited six decades ago.” As 

Bolger observed, this argument directly conflicts with the 

Supreme Court’s repeated observation that “[t]he question 

whether to apply strict liability in a new setting is largely 

determined by the policies underlying the doctrine.” (O’Neil, 

supra, 53 Cal.4th at pp. 362–363; Anderson, supra, 53 Cal.3d at 

p. 995; see also Bay Summit, supra, 51 Cal.App.4th at p. 774.)

We conclude Bolger has properly applied well-established strict

liability law to the facts of its case and was correctly decided.

D. Analysis 

1. Vertical Chain of Distribution

As technology advances, innovation is paving the way to 

new business practices. Amazon is on the leading edge of ecommerce. Based on our review of Amazon’s third-party business 

model under the BSA, we are persuaded that Amazon’s own 

business practices make it a direct link in the vertical chain of 

distribution under California’s strict liability doctrine. 

Contrary to Amazon’s assertion that it merely provided an 

online storefront for TurnUpUp and others to sell their wares, it 

is undisputed Amazon placed itself squarely between TurnUpUp, 

the seller, and Loomis, the buyer, in the transaction at issue. 

When Loomis wanted to buy a hoverboard for her son, she

perused product listings on Amazon’s website. Amazon took 

Loomis’s order and processed her payment. It then transmitted 
17

the order to TurnUpUp, who packaged and shipped the product

to Loomis. 

When Loomis wondered whether the hoverboard would 

arrive in time for Christmas, she communicated her concerns 

through Amazon. TurnUpUp was not allowed to communicate 

with Loomis directly. If Loomis had wanted to return the 

hoverboard, the return would have been routed through Amazon.

Amazon remitted Loomis’s payment to TurnUpUp after 

deducting its fees, including a 15 percent referral fee based on the 

total sale price. These facts undermine Amazon’s 

characterization of its marketplace as an online mall providing 

online storefronts for sellers. Owners of malls typically do not 

serve as conduits for payment and communication in each 

transaction between a buyer and a seller. Moreover, they do not 

typically charge a per-item fee rather than a fixed amount to rent 

their storefronts. Instead, these actions – 1) interacting with the 

customer, 2) taking the order, 3) processing the order to the third 

party seller, 4) collecting the money, and 5) being paid a 

percentage of the sale – are consistent with a retailer or a 

distributor of consumer goods.

2. Stream of Commerce Approach

Although we conclude Amazon is a link in the vertical 

chain of distribution, we nevertheless recognize e-commerce may 

not neatly fit into a traditional sales structure. The stream of 

commerce approach or market enterprise theory offers an 

alternative basis for strict liability. 

“[U]nder the stream-of-commerce approach to strict 

liability no precise legal relationship to the member of the 

enterprise causing the defect to be manufactured or to the 

member most closely connected with the customer is required 
18

before the courts will impose strict liability. It is the defendant’s 

participatory connection, for his personal profit or other benefit, 

with the injury-producing product and with the enterprise that 

created consumer demand for and reliance upon the product (and 

not the defendant’s legal relationship (such as agency) with the 

manufacturer or other entities involved in the manufacturingmarketing system) which calls for imposition of strict liability. 

[Citation.]” (Kasel , supra, 24 Cal.App.3d at p. 725.) Thus, a 

defendant may be strictly liable under the stream of commerce

approach if: “(1) the defendant received a direct financial benefit 

from its activities and from the sale of the product; (2) the 

defendant’s role was integral to the business enterprise such that 

the defendant’s conduct was a necessary factor in bringing the 

product to the initial consumer market; and (3) the defendant 

had control over, or a substantial ability to influence, the 

manufacturing or distribution process.” (Bay Summit, supra, 51 

Cal.App.4th at p. 778.)

Viewing the evidence in the light most favorable to Loomis, 

there exists a triable issue of material fact as to each of the three 

factors identified above. First, Amazon does not dispute it 

received a direct financial benefit in the form of fees, including a 

monthly subscription fee and a 15 percent referral fee, from the 

sale of the product. However, it contends the fees it charges must

also be connected to its activities in bringing the product to the 

initial consumer market. (Bay Summit, supra, 51 Cal.App.4th at 

p. 776 [“Shell directly profited from its activities in creating a 

market for the polybutylene plumbing system and from each sale 

of the plumbing system.”].) It argues it has engaged in no such 

activities, and has derived no financial benefit, because the 

market for hoverboards existed regardless of Amazon. 
19

Contrary to Amazon’s broad interpretation of what 

constitutes “the initial consumer market,” caselaw tells us “the 

relevant market in which the defendant was deemed a 

participant was the initial distribution to the consuming public of 

the particular defective product of a given manufacturer,” “not 

just products of the same classification.” (Tauber-Arons, supra,

101 Cal.App.3d at p. 276; see also Kasel, supra, 24 Cal.App.3d at 

p. 725 [defendant’s participation in the enterprise which

distributed and created consumer demand for “Remington

Express” shot shells]; Bay Summit, supra, 51 Cal.App.4th at p. 

776 [polybutylene plumbing system].) Therefore, we need to 

determine whether Amazon received a direct financial benefit 

from its activities to bring TurnUpUp hoverboards to market. 

To this end, Amazon presented no evidence that it did not 

play a role in establishing a market for TurnUpUp hoverboards.

Instead, it presented testimony that it had no information what 

other sales channels TurnUpUp used to sell its hoverboards. By 

contrast, the evidence shows Amazon received $110,645.92 from 

its sale of TurnUpUp hoverboards from September 14, 2015 to 

December 16, 2015. At a minimum, this evidence creates a 

triable issue of material fact as to whether Amazon received a 

direct financial benefit from its activities and sales of the product. 

For the same reason, there exists a triable issue with 

respect to the second factor—whether Amazon’s role was integral 

to the business enterprise. Amazon has failed to meet its burden 

to demonstrate this factor cannot be established because it has 

presented no evidence of its role in bringing TurnUpUp’s 

hoverboards to market. 

Third, the record demonstrates Amazon had substantial 

ability to influence the manufacturing or distribution process 
20

through its ability to require safety certification, indemnification, 

and insurance before it agrees to list any product. For example, 

the BSA allows Amazon to require certification of products it lists

from the Underwriter’s Laboratories, which, among other things, 

establishes standards for manufacturing practices. Amazon’s

contention that it has no relationship with the manufacturer or 

the distributors has no bearing on whether it can influence the 

manufacturing process. 

We are persuaded the trial court erroneously granted 

summary adjudication on the strict liability claim based on a 

stream of commerce approach.

3. Service Provider

Amazon disputes it plays a role in the vertical distribution 

chain or the stream of commerce because it is not a 

manufacturer, seller, or supplier, but merely a service provider. 

It seizes on a single sentence in O’Neil to create a “threshold 

requirement” for the imposition of strict liability. The sentence 

in O’Neil reads: “That the defendant manufactured, sold, or 

supplied the injury-causing product is a separate and threshold 

requirement that must be independently established.” (O’Neil, 

supra, 53 Cal.4th at p. 362.) Amazon would have us interpret

that sentence in O’Neil to limit strict liability only to 

manufacturers, sellers, and suppliers. Read in context, however,

it is clear O’Neil did not intend to overturn five decades of case 

law extending strict liability to lessors, bailors, and others within 

the stream of commerce who may not bear the label of 

manufacturer, seller, or supplier. (See, e.g., Fortman v. Hemco, 

Inc. (1989) 211 Cal.App.3d 241, 251 [“entities in the stream of 

commerce for purposes of strict liability are not limited to those 
21

readily identifiable as designer, manufacturer, or vendor of the 

defective product”].) 

In O’Neil, the plaintiff sought to impose strict liability on a 

manufacturer who supplied a nondefective part that was later

used with a defective product that caused injury. By this 

sentence, the high court merely indicated an innocent 

manufacturer may not be held strictly liable for a defective 

product made, sold, or supplied by someone else. (O’Neil, supra, 

53 Cal.4th at p. 362.)

We likewise reject Amazon’s argument it is merely a 

service provider who is not subject to strict products liability. We 

have identified how it was instrumental in the sale of the 

hoverboard to Loomis. 

Even if Amazon may be characterized as a service provider, 

Murphy v. E. R. Squibb & Sons, Inc. (1985) 40 Cal.3d 672

(Murphy) and Hernandezcueva v. E.F. Brady Co., Inc. (2015) 243 

Cal.App.4th 249 (Hernandezcueva), cited by Amazon, are 

instructive on the issue of when strict liability attaches to service 

providers. 

In both cases, the court determined the defendant provided 

both a service and sale of a product. Therefore, “[t]he propriety of 

imposing strict liability on a party that both supplies and installs 

a defective component hinges on the circumstances of the 

transaction.” (Hernandezcueva, supra, 243 Cal.App.4th at p. 

260.) In Murphy, the court determined the service aspect of the 

defendant pharmacist’s role predominated over its sale of 

prescription drugs. (Murphy, supra, 40 Cal.3d at p. 675.) In 

Hernandezcueva, the court determined the subcontractor that 

installed drywall in a commercial project provided both a service 

(the installation) and the sale of a product (the drywall). Despite 
22

its dual role, the subcontractor was a participant in the stream of 

commerce for strict liability purposes. (Hernandezcueva, supra, 

at p. 263.)

Here, Amazon provides a service to TurnUpUp in the form 

of a website to list its product and, as described above, was also 

instrumental in the sale of the product by placing itself squarely 

between TurnUpUp and Loomis. That it did not hold title to the 

product and did not have physical possession of the hoverboard

does not automatically render it solely a service provider and

remove it from strict liability. Canifax, supra, 237 Cal.App.2d 44 

is instructive on this issue. 

In Canifax, the customer purchased the defective fuse (and 

related supplies) from a jobber, who in turn placed an order with 

the defendant, who passed on the order for the fuse to the 

manufacturer. The manufacturer shipped the fuse directly to the 

jobber and the defendant paid the manufacturer from the 

proceeds it received from the jobber. (Canifax, supra, 237 

Cal.App.2d 44 at p. 48.) The defendant disputed strict liability 

on the basis it did not manufacture the fuse, sell the fuse, and 

never had possession of the fuse. The court held, “The fact that it 

chooses to delegate the manufacture of [the] fuse to another and 

that it causes the manufacturer to ship the product directly to the 

consumer cannot be an escape hatch to avoid liability.” (Id. at p. 

52.)

The circumstances surrounding the sale of the hoverboard 

are materially similar to those surrounding the sale of the fuse in 

Canifax. As in Canifax, Amazon did not manufacture the 

hoverboard, did not sell the hoverboard, and never had physical 

possession of the hoverboard. These facts, however, “cannot be 

an escape hatch to avoid [strict] liability.” (Canifax, supra, 
23

237 Cal.App.2d at p. 52.) This is because, like the defendant in 

Canifax, Amazon took the order for the hoverboard, took the 

payment, and passed the order up the chain of distribution. (Id. 

at p. 50.)

4. Out-of-State Cases

We are not persuaded by Amazon’s reliance on those 

decisions that restrict strict liability to sellers or manufacturers

by applying out-of-state law. (Erie Ins. Co. v. Amazon.com, Inc.

(4th Cir. 2019) 925 F.3d 135, 140 [“products liability under 

Maryland law. . . is imposed on sellers and manufacturers (a 

manufacturer also being a seller)”]; Stiner v. Amazon.com, Inc. 

(Ohio 2020) 2020-Ohio-4632 [Ohio Products Liability Act]; Fox v. 

Amazon.com, Inc. (6th Cir. 2019) 930 F.3d 415, 425 [Tennessee 

Products Liability Act]; Milo & Gabby LLC v. Amazon.com, Inc.

(Fed.Cir. 2017) 693 F.Appx 879, 890 [addressing federal 

intellectual property law]; Garber v. Amazon.com, Inc. (N.D.Ill. 

2019) 380 F.Supp.3d 766, 779 [Illinois law on products liability]; 

State Farm Fire and Cas. Co. v. Amazon.com, Inc. (W.D.Wis. 

2019) 390 F.Supp.3d 964 [Wisconsin products liability statute].) 

We need not stray so far afield when California courts have 

provided extensive analysis of strict liability doctrine in 

California.

We have identified the acts constituting Amazon’s 

participation in the distribution chain. “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.” (Bolger, supra, 53 Cal.App.5th at p. 438.) These acts 

support our conclusion that Amazon is in the vertical chain of 

distribution of the alleged defective hoverboard. Next, we assess 

whether applying strict liability to Amazon’s third-party seller 
24

business model supports the relevant public policy

considerations. 

5. Policy Considerations Underlying the Doctrine

Are Furthered by Imposing Strict Products Liability 

in This Case

In analyzing whether strict liability is appropriate in new 

circumstances, courts assess whether relevant public policy goals 

are furthered by its application. (Bay Summit, supra, 51 

Cal.App.4th at p. 774.) As noted earlier in this opinion, the 

relevant public policy considerations are: (1) whether Amazon 

may play a substantial part in insuring that the product is safe or 

may be in a position to exert pressure on the manufacturer to 

that end, (2) whether Amazon may be the only member in the 

distribution chain reasonably available to the injured plaintiff, 

and (3) whether Amazon is in a position to adjust the costs of 

compensating the injured plaintiff amongst various members in 

the distribution chain. (Vandermark, supra, 61 Cal.2d at pp. 262-

263.) We address each in turn. 

As to product safety, Amazon contends it has no proactive 

authority over product design or manufacture because its 

relationship is typically with the distributor or retailer, not the 

manufacturer. It asserts it can only reactively address safety 

issues by removing or suspending sellers after a product has been 

shown to be unsafe. Thus, imposing strict liability on it will not 

enhance product safety. 

By its very argument, Amazon acknowledges it plays a role 

in ensuring product safety. Indeed, sellers are required under 

the BSA to comply with all applicable laws, including, 

presumably, consumer safety laws and regulations. The evidence 

shows Amazon may require proof that a product complies with 
25

recognized safety standards before it is listed. For example, 

Amazon may require documentation or certification from the 

Underwriter’s Laboratories, which sets forth standards for 

manufacturing practices and devises safety tests for products. 

Additionally, Amazon on occasion has consulted with the CPSC 

to determine if there are specific regulations or issues related to 

products it lists that are “outside of the norm.” 

These steps, which Amazon has taken to ensure product 

safety in limited circumstances, refute its contention it has no

ability to proactively affect product safety. Application of strict 

liability in this case may incentivize Amazon to expand its safety 

compliance requirements to more products and thus further the 

goal of product safety.

Moreover, we agree with Bolger that “[j]ust like a 

conventional retailer, Amazon can use its power as a gatekeeper 

between an upstream supplier and the consumer to exert 

pressure on those upstream suppliers (here, third party sellers) 

to enhance safety.” (Bolger, supra, 53 Cal.App.5th at p. 454.) 

Under the BSA, “Amazon sets fees that it would retain for the 

sale of a third-party product, protects itself by requiring thirdparty vendors to indemnify Amazon should any ‘claim, loss, 

damage, settlement, cost, expense or other liability’ occur, and 

reserves the right to refuse to provide . . . services for a product 

that does not comport with Amazon’s policies. With the rights 

retained, Amazon could halt the placement of defective products 

in the stream of commerce, deterring future injuries.” (Gartner v. 

Amazon.com, Inc. (S.D.Tex. 2020) 433 F.Supp.3d 1034, 1044, 

citation omitted.)

As to consumer compensation, Amazon may be the only 

member of the distribution chain reasonably available for an 
26

injured consumer to recover damages. Amazon contends there is 

no evidence to show how frequently an injured plaintiff is truly 

left without recourse. The record shows, however, that Forrinx, 

the only other defendant in this matter, failed to appear and a 

default was taken against it. Indeed, the same issue arose in

Bolger, where two defendants failed to appear, and a third could 

only be served in China. (Bolger, supra, 53 Cal.App.5th at p. 453; 

see also Fox v. Amazon.com, Inc., supra, 930 F.3d at p. 424.) 

As to loss spreading, Amazon can adjust the costs of 

consumer protection between it and third party sellers through 

its fees, indemnity requirements, and insurance. Amazon does 

not argue it is unable to spread the costs in these, and other, 

ways. It instead contends these costs will result in higher prices 

to be paid by consumers and small businesses will also be 

required to bear these higher costs. Amazon’s argument 

obfuscates the goal of loss spreading. At issue is whether the loss 

should be borne solely by the injured consumer who may have no 

recourse against other defendants, or whether it may be spread 

among those who profited from the sale of the defective product. 

In our view, these policy considerations support the application of 

strict liability to Amazon’s third party seller business model. 

Lastly, Amazon contends the policies articulated by the 

California Supreme Court in Greenman and Vandermark are 

incomplete and have been eroded by subsequent events. Indeed, 

Amazon questions whether strict liability has brought benefits 

commensurate with its substantial costs. These are issues best 

directed to the California Supreme Court, who created strict 

products liability doctrine almost 60 years ago and whose 

decisions we are bound to follow. (Auto Equity Sales, Inc. v. 

Superior Court (1962) 57 Cal.2d 450, 455.) 
27

Accordingly, we hold the application of strict liability to 

Amazon’s third-party seller business model is supported by the 

relevant public policy consideration discussed in Vandermark.

III. Summary Adjudication Was Improperly Granted as 

to the Negligent Products Liability Claim

Loomis also challenges the summary adjudication of her 

negligence claim, contending Amazon failed to meet its burden to

demonstrate that one or more elements of the claim cannot be 

established or that there is a complete defense to the claim. 

Amazon argues it does not owe Loomis a duty of care for the 

same reason it is not strictly liable: it did not manufacture or sell 

the product. It asserts “[a]n element of a product-liability claim 

is that the defendant manufactured or sold the product. Her 

failure to establish that element doomed her . . . strict-liability 

and negligence claims.” Amazon’s position is reasonable given 

that “[t]he theories of negligence and strict liability ‘parallel and 

supplement each other’ [citation], and the same policy 

considerations that militate for or against imposition of strict 

liability may apply with equal force in the context of negligence. 

[Citations.]” (Bettencourt v. Hennessy Industries, Inc. (2012) 205 

Cal.App.4th 1103, 1118.) However, Amazon provides no legal

support for its argument that negligent products liability may 

only be imposed on manufacturers and sellers. 

Instead, a duty of care may be imposed on a defendant who 

is not a manufacturer or seller in the context of a negligent 

products liability claim if certain policy factors are met. The 

O’Neil court explained, “Courts of this state have traditionally 

considered several factors in determining the existence and scope 

of duty: ‘the foreseeability of harm to the plaintiff, the degree of 

certainty that the plaintiff suffered injury, the closeness of the 
28

connection between the defendant’s conduct and the injury 

suffered, the moral blame attached to the defendant’s conduct, 

the policy of preventing future harm, the extent of the burden to 

the defendant and consequences to the community of imposing a 

duty to exercise care with resulting liability for breach, and the 

availability, cost, and prevalence of insurance for the risk 

involved.’ ” (O’Neil, supra, 53 Cal.4th at p. 364.)

Aside from those factors which parallel strict liability 

doctrine, Amazon provided no analysis as to how it did not owe a 

duty of care to Loomis under those factors. For this reason, the 

trial court erred in granting summary adjudication as to the 

negligent products liability count.5 

5 Our conclusion that Amazon has failed to meet its burden 

on summary adjudication is not the equivalent of a finding that 

Amazon owed Loomis a duty of care or was negligent under these 

circumstances.
29

DISPOSITION

The judgment is reversed. The trial court is directed to 

vacate its order granting summary judgment. A new order shall 

be entered (1) denying summary adjudication of Loomis’s strict 

products liability and negligent products liability claims as well 

as her claim for exemplary damages, and (2) granting summary 

adjudication of the remaining claims. Upon entry of the new 

order, the trial court shall conduct further proceedings not 

inconsistent with this opinion. Loomis shall recover her costs on 

appeal.

OHTA, J.*

I concur:

STRATTON, Acting P. J.

* Judge of the Los Angeles Superior Court, assigned by the 

Chief Justice pursuant to article VI, section 6 of the California 

Constitution.
1

Wiley, J., Concurring.

The Amazon is the world’s largest river. Amazon.com 

supposedly chose its trademark because it aimed to create the 

world’s largest river of commerce. Amazon.com can control what 

it created.

Unbeknownst to Amazon, a manufacturer may use 

Amazon’s site to sell a defective product that will cause future 

accidents. Perhaps it is a computer battery that can explode. 

(Bolger v. Amazon.com, LLC (2020) 53 Cal.App.5th 431, 444 

(Bolger).) Perhaps it is a hoverboard that ignites fires. 

Whatever it is, Amazon is situated swiftly to learn of and to 

contain the emerging problem, thereby reducing accidental 

injuries. Amazon can cabin the danger by stopping sales. 

Amazon can alert past buyers who have yet to experience the 

lurking hazard: Amazon has information about its customers 

and their purchases. Other measures are possible.

Once Amazon is convinced it will be holding the bag on 

these accidents, this motivation will prompt it to engineer 

effective ways to minimize these accident costs. Tort law will 

inspire Amazon to align its ingenuity with efficient customer 

safety. Customers will benefit.

Amazon maintains it already safeguards customer safety. 

(E.g., Bolger, supra, 53 Cal.App.5th at pp. 442–443.) On appeal, 

Amazon’s brief says it “voluntarily implemented a product safety 

system years ago, independent of the specter of tort liability, and 

. . . it spends hundreds of millions of dollars annually to ensure 

that products offered on the website are safe, compliant, and 

authentic.” The cited source of this assertion is not the record, 

but rather an online press release “written by Amazon” posted in 

“response to a Wall Street Journal story about the safety of 
2

products offered in [the Amazon.com] store.” (Amazon, Product 

safety and compliance in our store (Aug. 23, 2019), 

<https://www.aboutamazon.com/news/company-news/productsafety-and-compliance-in-our-store> [as of Apr. 5, 2021], archived 

at <https://perma.cc/23LV-RSVE> (AboutAmazon.com).) 

Amazon’s cited post makes the following admissions:

“[W]e [at Amazon.com] have developed, and continuously 

refine and improve, our tools that prevent suspicious, unsafe, or 

non-compliant products from being listed in our store. [¶] Our 

proactive measures begin when a seller attempts to open an 

account. Our new seller account vetting includes a number of 

verifications and uses proprietary machine learning technology 

that stops bad actors before they can register or list a single 

product in our store. All products offered in our stores must 

comply with applicable laws and regulations, and our own 

policies. For example, we require toys to be tested to relevant 

safety standards set by the Consumer Product Safety 

Commission. We have a dedicated global team of compliance 

specialists that review submitted safety documentation, and we 

have additional qualification requirements that sellers must 

meet to offer products. In 2018, our teams and technologies 

proactively blocked more than three billion suspect listings for 

various forms of abuse, including non-compliance, before they 

were published to our store. [¶] Once a product is available in 

our store, we continuously scan our product listings and updates 

to find products that might present a concern. Every few 

minutes, our tools review the hundreds of millions of products, 

scan the more than five billion attempted daily changes to 

product detail pages, and analyze the tens of millions of customer 

reviews that are submitted weekly for signs of a concern and 
3

investigate accordingly. Our tools use natural language 

processing and machine learning, which means new information 

is fed into our tools daily so they can learn and constantly get 

better at proactively blocking suspicious products. [¶] In 

addition, we provide a number of ways for regulatory agencies, 

industry organizations, brands, customers, and our customer 

service teams to report safety issues. When we receive these 

reports, we move quickly to protect customers, remove unsafe 

products from our store, and investigate. For example, if a 

customer reports a concern with a product, a customer service 

associate can instantly trigger an investigation. Additionally, 

because of our direct relationships with customers, we are able to 

trace and directly notify customers who purchased a particular 

product online and alert them to a potential safety issue—our 

systems are far more effective than other online and offline 

retailers and customers can feel confident they’ll have the 

information they need. [¶] We also regularly work with agencies 

including the Food and Drug Administration and Consumer 

Product Safety Commission, and the information we share helps 

them identify trends and develop regulations. We are active in 

industry working groups and committees that are dedicated to 

developing new solutions and guidelines that will benefit all 

retailers and consumers. [¶] We invest significant resources to 

protect our customers and have built robust programs designed 

to ensure products offered for sale in our store are safe and 

compliant. We want customers to shop with confidence and if 

ever a customer has a concern, they can contact our customer 

service team, and we will investigate.” (AboutAmazon.com, 

supra.)
4

These words are good. The admissions confirm the obvious: 

Amazon can control its river. It can undertake cost-effective 

steps to minimize accidents from defective products sold on its 

website. Strict tort liability will underline the priority Amazon 

places on its safety efforts.

Thus we have an easy case that beautifully illustrates the 

deep structure of modern tort law: a judicial quest to minimize 

the social costs of accidents—that is, the sum of the cost of 

accidents and the cost of avoiding accidents. Judges have been 

applying this social cost-benefit analysis as a felt instinct for a 

long time, as we shortly will survey. That deep structure makes 

this case simple to decide. When efforts to minimize accident 

costs are relatively inexpensive and apt to be effective, courts 

impose tort duties. Amazon has cost-effective options for 

minimizing accident costs. Amazon therefore has a duty in strict 

liability to the buyers from its site, including Kisha Loomis.

I

In large measure, tort law is cost-benefit analysis. 

Comparing the cost to the benefit of an activity is rational 

thinking. All else equal, it is rational to invest in ventures where 

the expected return exceeds the cost. Conversely, it is irrational 

to spend $2 of your own money to get something you value only at 

$1.

The judicial use of cost-benefit analysis is familiar 

throughout tort doctrine, in the doctrines of negligence as well as 

strict liability. In contrast to formal cost-benefit analyses in 

other spheres, this judicial practice does not compare quantified 

sums of dollar and cents on a balance sheet; case records nearly 

never contain precise data of the right kind. Rather, the 
5

litigation setting forces judicial reasoning to be more seat-of-thepants, more commonsensical than that. 

We see this commonsensical method over and over through 

the decades.

The intellectual history of cost-benefit analysis in tort law 

goes back at least a century. (E.g., Berkovitz v. American River 

Gravel Co. (1923) 191 Cal. 195, 199 (Berkovitz); see also Chicago, 

Burlington & Quincy Railroad Co. v. Krayenbuhl (Neb. 1902) 65

Neb. 889, 902–904 [91 N.W. 880, 882–883].) 

Shortly we return to the 1923 Berkovitz decision.

In 1944, Justice Roger Traynor—California’s most 

esteemed jurist—explained tort doctrine must aim to minimize 

the social costs of accidents. (Escola v. Coca Cola Bottling Co.

(1944) 24 Cal.2d 453, 462 (conc. opn. of Traynor, J.) [“public 

policy demands that responsibility be fixed wherever it will most 

effectively reduce the hazards to life and health inherent in 

defective products”] (Escola); see also Greenman v. Yuba Power 

Products, Inc. (1963) 59 Cal.2d 57, 63–64 (Traynor, J.) 

[unanimous court adopts logic of Traynor’s concurring Escola

opinion] (Greenman).)

Justice Traynor’s Greenman decision had enormous impact. 

“Within a decade of Greenman, a majority of jurisdictions in the 

United States had adopted causes of action in strict product 

liability. Today all but a handful of states employ some version of 

products liability law.” (Goldberg et al., Tort Law: 

Responsibilities and Redress (3d ed. 2012) p. 887.)

Shortly after Escola, Judge Learned Hand formalized tort 

law’s efficiency calculus with enduring precision. (United States 

v. Carroll Towing Co. (2d. Cir. 1947) 159 F.2d 169, 173 

[defendant’s duty is a function of three variables: (1) the 
6

probability of an accident; (2) the gravity of the injury from an 

accident; versus (3) the burden—that is, the cost—of adequate 

precautions]; see Posner, A Theory of Negligence (1972) 1 J. Legal 

Stud. 29, 32–33.)

In 1970, Professor (and now Senior United States Circuit 

Judge) Guido Calabresi treated tort law’s deep structure in his 

landmark book, The Costs of Accidents (Calabresi). In 

Calabresi’s approach, courts can use cost-benefit analysis to 

appraise whether defendants can make cost-effective accident 

avoidance investments. Where the benefit of investments in 

accident avoidance outweighs the cost, courts should impose tort 

duties on defendants. But courts refrain from imposing tort 

duties in situations where the options for accident avoidance are 

so limited that the costs of accident avoidance do not outweigh 

the benefits. (Cf. Posner, Guido Calabresi’s The Costs of 

Accidents: A Reassessment (2005) 64 Md. L.Rev. 12, 15 

[Calabresi’s framework approximated cost-benefit analysis].)

In 1978, the California Supreme Court’s Barker decision 

explicitly put cost-benefit analysis into the heart of tort law. 

(Barker v. Lull Engineering Co. (1978) 20 Cal.3d 413.) The 

question was whether a vehicle called a high-lift loader was a 

defective product. Lumber tipped off a loader working on a hilly 

construction site. The falling lumber injured the driver, who 

sued the manufacturer, saying the loader was a defective 

product: the manufacturer could have made the loader with 

stabilizing mechanical arms, which the driver maintained would 

have prevented the tipping and his injury. The manufacturer 

disagreed, saying its loader design was not defective at all; rather 

the problem was the bad decision to use the loader on a steep hill, 

where of course things would tip over. To resolve the issue, our 
7

Supreme Court crafted a cost-benefit standard: do the benefits of 

the challenged design outweigh the risk of danger inherent in 

such design? (Id. at pp. 418–421 & fn. 2, 426–427, 430–435.) 

Thus, a product is defective if its design embodies excessive 

preventable danger: that is, unless the benefits of the design 

outweigh the risk of danger inherent in such design. (Soule v. 

General Motors Corp. (1994) 8 Cal.4th 548, 567, 570.) The Barker 

decision also formulated the alternative “consumer expectations” 

test. (Barker, at pp. 429–430.)

By the 1980s, the notion of tort cost-benefit analysis was 

mainstream. (See Evra Corp. v. Swiss Bank (7th Cir. 1982) 673 

F.2d 951, 958 (Posner, J.) [“The amount of care that a person 

ought to take is a function of the probability and magnitude of 

the harm that may occur if he does not take care”].)

In 2016, the California Supreme Court cited Calabresi’s 

enduring cost-benefit approach in its unanimous Kesner opinion. 

(Kesner v. Superior Court (2016) 1 Cal.5th 1132, 1153, citing 

Calabresi, supra [courts should assign tort liability to ensure 

those best situated to prevent injuries are incentivized to do so] 

(Kesner).) 

We return to Kesner shortly.

This developing tort doctrine brings us to today and to 

Amazon. 

Under this doctrine, Amazon owes its customers a duty in 

strict liability because Amazon’s position in the distribution chain 

allows it to take cost-effective steps to reduce accidents. The costbenefit analysis in Amazon’s case is not a close call: the benefits 

of the actions Amazon can take to minimize accidents vastly 

outweigh the costs of these actions to Amazon. Amazon’s options 

are practical and cost-effective; indeed, Amazon says it is already 
8

taking these actions. Amazon thus must face strict liability for 

Loomis’s fiery encounter with the hoverboard she bought from 

Amazon’s site. Imposing this duty on Amazon creates financial 

incentives that back up Amazon’s good words about its concern 

for customer safety.

Some suggest considerations of moral justice can compete 

with tort law’s calculus of social benefit. (E.g., Simons, Tort 

Negligence, Cost-Benefit Analysis, and Tradeoffs: A Closer Look 

at the Controversy (2008) 41 Loyola L.A. L.Rev. 1171, 1172–1173; 

Schwartz, Mixed Theories of Tort Law: Affirming Both 

Deterrence and Corrective Justice (1997) 75 Tex. L.Rev. 1801, 

1819–1820.) This case presents no potential conflict like that. 

The only time Amazon’s brief uses the word “justice” is to write 

“the Bolger Court saw the ‘novelty of these issues’ as an opening 

to use law as ‘an instrument of justice’ to implement ‘current 

concepts of what is right and just.’ 53 Cal. App. 5th at 462 

(quoting Kriegler v. Eichler Homes, Inc., 269 Cal. App. 2d 224, 

227 (1969)).” If they ever do, moral justice and cost-benefit 

analyses do not conflict in this case.

II

The case law jibes completely with this cost-benefit 

analysis. This is true for decisions that impose tort duties, as 

well as for decisions that refuse to impose tort duties. We see this 

consistency in both categories of decisions. We begin with 

decisions that impose duties.

A

Courts impose tort duties on entities situated to take costeffective measures to reduce the costs of accidents. Six 

precedents illustrate this point.
9

1

Justice Traynor’s Escola opinion proposed making Coca 

Cola strictly liable for an exploding cola bottle. The company was 

positioned to fix the problem through efficient accident avoidance 

measures. Coca Cola could have pressurized bottles more 

carefully, bought stronger bottles, tested more thoroughly, 

switched to cans, or used any combination of tactics. (See Escola,

supra, 24 Cal.2d at p. 459 [“The bottle was admittedly charged 

with gas under pressure, and the charging of the bottle was 

within the exclusive control of [Coca Cola]”]; id. at p. 461 [Coca 

Cola “had exclusive control over both the charging and inspection 

of the bottles”]; id. at p. 462 (conc. opn. of Traynor, J.) [the bottler 

“is best situated to afford such protection” from the problem of 

exploding soda bottles].) Coca Cola made the key decisions and 

so was positioned to make soda containers safer—or, if costeffective fixes were impossible, to stop marketing the product 

altogether. Justice Traynor thus urged strict liability to force the 

company to internalize the accident costs it had been imposing on 

its customers. The Supreme Court unanimously affirmed the 

judgment against Coca Cola. (Id. at p. 461.)

2

In the same way, the Greenman decision imposed strict 

liability on a lathe maker that could have used better set screws 

to hold spinning wood more securely. Improved screws could 

have made the wood less likely to fly off the lathe and hurt the 

operator. (See Greenman, supra, 59 Cal.2d at p. 60.) Again, tort 

law forced the manufacturer to internalize the costs of accidents 

from its product.
10

3

The Vandermark opinion extended strict liability to a car 

retailer that sold a new Ford to one Chester Vandermark. 

(Vandermark v. Ford Motor Co. (1964) 61 Cal.2d 256.) 

Vandermark claimed the car’s braking defect caused it to crash. 

For the unanimous court, Justice Traynor applied strict liability 

to the retailer as well as to the manufacturer, because the 

retailer was positioned to take actions to reduce the costs of 

accidents from defective products. The retailer was part of the 

manufacturer’s overall marketing enterprise and in some cases 

would be the only member of that enterprise reasonably available 

to injured plaintiffs. The retailer’s continuing business 

relationship with the manufacturer would allow dealers to exert 

pressure on the possibly remote manufacturer as an added safety 

incentive. (See id. at pp. 261–263.) The dealer never suggested 

its ability to exert pressure on Ford was so costly and ineffective 

as to be impractical.

4

Rowland v. Christian (1968) 69 Cal.2d 108 is another 

important case imposing tort liability on a decision maker 

positioned to undertake efficient accident precautions. The 

opinion put a duty on Nancy Christian, who knew the bathroom 

faucet handle in her apartment was cracked and needed 

replacing. Christian invited James Rowland to the apartment. 

Rowland said he was going to the bathroom. The handle broke 

and cut Rowland when he tried to use it. The court held 

Christian owed a duty to warn Rowland of the faucet crack. (Id. 

at pp. 110–112.)

This ruling made perfect cost-benefit sense. It would have 

cost Christian little to share her knowledge of the latent danger 
11

with Rowland. The information would have allowed Rowland to 

take suitable care. Imposing this accident avoidance duty on the 

knowledgeable property possessor was efficient and thus socially 

rational. The fact this was a negligence case shows cost-benefit 

analysis in tort law is not confined to the context of strict 

liability.

5

The previously mentioned Kesner case illustrated the logic 

of tort law’s cost-benefit analysis, and again outside the strict 

liability setting. Employees unwittingly carried workplace 

asbestos dust home to family members, who breathed it in and 

developed mesothelioma from the take-home exposure. The 

unanimous Supreme Court ruled the employers had a duty to the 

family members. (Kesner, supra, 1 Cal.5th at pp. 1141, 1156, 

1165.)

The tort goal was “incentivizing reasonable preventative 

measures.” (Kesner, supra, 1 Cal.5th at p. 1151.) The employers 

did “not claim that precautions to prevent transmission via 

employees to off-site individuals—such as changing rooms, 

showers, separate lockers, and on-site laundry—would 

unreasonably interfere with business operations.” (Id. at p. 

1153.) Employers “are generally better positioned than their 

employees or members of their employees’ households to know of 

the dangers of asbestos and its transmission pathways, and to 

take reasonable precautions to avoid injuries that may result 

from on-site and take-home exposure.” (Ibid.; see also id. at p. 

1156 [“Businesses making use of asbestos were well positioned, 

relative to their workers, to undertake preventive measures, and 

[the employers] cite no evidence to suggest such measures would 

have been unreasonably costly.”].) 
12

The cost-benefit analysis thus was simple: the employers 

had cost-effective accident avoidance measures available to them, 

so they owed a duty in tort to family members facing take-home 

asbestos exposure. (See Kesner, supra, 1 Cal.5th at pp. 1154–

1156.)

6

Amazon repeatedly cites a Court of Appeal decision: Bay 

Summit Community Assn. v. Shell Oil Co. (1996) 51 Cal.App.4th 

762 (Bay Summit), which concerned Shell Oil’s liability for leaky 

polybutylene plumbing systems. This decision is instructive, as 

is the whole polybutylene saga. Both cut against Amazon.

Polybutylene was a plastic used for water piping. 

“Beginning in the late 1970s, polybutylene plastic plumbing 

systems—touted as being cheaper and more durable than copper 

pipe systems—were installed in new homes nationwide . . . . 

Over the years, several million homes, many of them mobile 

homes, were built with polybutylene plumbing systems. Before 

long, the plumbing systems began to experience failures of the 

fittings and of the pipe itself.” (Hensler et al., Class Action 

Dilemmas: Pursuing Public Goals for Private Gain (2000) p. 375, 

fn. omitted (RAND).)

Polybutylene piping was the classic defective product. It 

seemed like a good thing when introduced, but over time it 

literally failed to hold water. Chlorine in drinking water 

apparently caused it eventually to crack and leak, leading to 

nationwide litigation and massive settlements involving some 

220,000 replumbing jobs and many millions of dollars. (RAND, 

supra, at p. 390.) 

In 1977, Shell Oil Company had begun manufacturing 

polybutylene resin—the raw material for the pipes—and it was 
13

the sole manufacturer of polybutylene resin. But Shell entirely 

withdrew the product from the U.S. market in 1996. (RAND, 

supra, at p. 375.)

The Bay Summit decision was one chapter in the 

nationwide litigation that drove Shell out of the polybutylene 

market. In Bay Summit, the case’s record was very limited and 

in conflict as to (1) whether Shell did in fact control the 

manufacturing or distribution process and (2) whether it was an 

integral factor in bringing a polybutylene plumbing system to 

market. (Bay Summit, supra, 51 Cal.App.4th at p. 778.) The 

court remanded the case for a factual determination of whether 

Shell “had control over, or a substantial ability to influence, the 

manufacturing or distribution process.” (Ibid.) Absent this

ability to control or influence the manufacturing or distribution 

system, Shell could not be strictly liable for leaking polybutylene 

plumbing systems.

Bay Summit is a disastrous precedent for Amazon because, 

unlike in Bay Summit, there is no doubt about Amazon’s ability 

to control the distribution system Amazon invented. Amazon is

the distribution system. It thus should be strictly liable for 

defective products people buy from its site.

Beyond the particular Bay Summit decision, the entire 

polybutylene saga is an example of how tort law can lead to 

socially rational decisionmaking by forcing commercial actors to 

internalize the costs of their actions. According to the RAND 

analysis, the final outcome was that polybutylene piping 

disappeared from the U.S. marketplace because it was faulty. 

Apparently it was cheaper to switch to different kinds of plastic 

than to bear the tort liability for polybutylene. If the product is 
14

defective, the sooner it is fixed or disappears, the better. This 

saga favors Loomis, not Amazon.

These six cases show courts have used cost-benefit analysis 

to decide whether to impose tort duties. Six cases on the other 

side of the coin show the same method.

B

Courts refrain from imposing tort duties where measures to 

avoid accidents are burdensome and unlikely to be cost-effective. 

This notion initially may seem off-putting: do we not seek to 

avoid accidents at all costs? No, we do not. As Calabresi 

explained, “[w]e take planes and cars rather than safer, slower 

means of travel.” (Calabresi, supra, at p. 18.) At some point, a 

quest for perfect safety becomes irrationally expensive. Six cases 

show how judicial cost-benefit analysis can locate this point.

1

The previously cited Berkovitz decision illustrates this 

judicial instinct. It used the cost-benefit method long before that 

terminology appeared in tort decisions. 

The Berkovitz accident was in 1919. Two couples in a 

“Dodge touring car” were breaking the speed limit at 2:00 a.m. in 

a city and rear-ended a gravel truck going about 10 miles per 

hour. (Berkovitz, supra, 191 Cal. at pp. 197–198.) People in the 

Dodge sued the truck company, claiming the truck’s coal-oil tail 

lamp was out. If true, that would have violated the law requiring 

a night light and thus would have been negligence per se. The 

evidence conflicted about the coal-oil lamp. The truck driver said 

he saw the reflection of the tail light three or four blocks before 

the accident scene and it was working then, so by his account the 

light must have failed in those three or four blocks—just 

moments before the crash. (Id. at p. 198.) The Supreme Court 
15

ruled that, under these circumstances, the truck company was 

entitled to an excuse instruction. (Id. at pp. 199–200.) The 

Berkovitz court permitted the excuse defense because it, in 

essence, decided the conduct the trucker described was efficient. 

The trucker claimed he made sure his light was working just 

before the accident. There was no other better and yet practical 

way for the trucker to check his tail light: in 1919, dashboard 

alerts about failed tail lights were things of the future. In that 

year, the only way the trucker could have been more cautious 

would have been to post a person “over the rear light to observe 

whether it is constantly burning.” (Id. at p. 199.) This lookout 

notion was obviously preposterous in the court’s view. This 

extreme measure would have been socially uneconomical—like 

forcing all interstate traffic today to drive at 10 miles per hour to 

minimize accidents. That much safety would be socially 

irrational.

Because the precaution cost would have been high while 

the accident risk from a very-briefly-unlit tail light was low, the 

Berkovitz decision refused to impose an absolute per se duty on 

the trucker. The cost of the additional precaution was socially 

irrational: posting lookouts on the back of every motor vehicle 

would have been more costly than the safety benefit would 

justify.

2

A second example is O’Neil v. Crane Co. (2012) 53 Cal.4th 

335 (O’Neil). Amazon relies on O’Neil, but that decision 

contradicts Amazon’s argument. 

The key feature about the O’Neil case was that defendant 

Crane made valves but was being sued for replacement asbestos 

gaskets Crane did not make. When workers refurbish an old 
16

leaky valve, they predictably put new replacement gaskets in the 

valve. But the O’Neil decision held valve maker Crane owed no 

tort duty, either in negligence or strict liability, to people 

repairing its valves who breathed dust from the replacement 

asbestos gaskets Crane did not make. (O’Neil, supra, 53 Cal.4th 

at p. 342.) 

Crane could foresee workers repairing its valves would use 

asbestos gaskets made by other companies. (O’Neil, supra, 53 

Cal.4th at p. 342.) So why did Crane have no tort duty? Because 

the Supreme Court said the cost of imposing this duty on one 

firm to warn of dangers from products from other manufacturers 

would outweigh the benefit of resulting injury reductions. This 

duty would be tremendously and ineffectively overbroad: like 

requiring “match manufacturers to warn about the dangers of 

igniting dynamite.” (Id. at p. 361.) But when every firm must 

warn everybody about everything, the costly exercise does no 

good. “ ‘To warn of all potential dangers would warn of nothing.’ ” 

(Id. at p. 363, quoting Andre v. Union Tank Car Co., Inc. (1985) 

213 N.J. Super. 51, 67 [516 A.2d 277, 286].) 

O’Neil’s cost-benefit analysis meant the court refused to 

impose a tort duty where it would be socially irrational to do so. 

Crane did not control the marketing of gaskets made by other 

firms. Amazon, by contrast, completely controls its river. There 

is nothing socially irrational or ineffectively redundant about 

making Amazon strictly liable for accidents from products bought 

from its website.

3

The same principle governed Peterson v. Superior Court

(1995) 10 Cal.4th 1185, 1188–1189 (Peterson), which ruled land 

and hotel owners are not strictly liable for injuries to their 
17

tenants and guests caused by an unknown defect in the premises. 

The owners remained liable in negligence; injured guests 

retained a strict liability action against the manufacturer, 

distributors, and retailers of the allegedly defective products. 

But to extend the strict liability duty to land owners for unknown 

defects owners did not create and could not discover through a 

reasonable inspection would mean imposing costly duties without 

a compensating benefit in accident reduction. “A landlord or 

hotel owner, unlike a retailer, often cannot exert pressure upon 

the manufacturer to make the product safe and cannot share 

with the manufacturer the costs of insuring the safety of the 

tenant, because a landlord or hotel owner generally has no 

‘continuing business relationship’ with the manufacturer of the 

defective product. . . . ‘The cost of insuring risk will not be 

distributed along the chain of commerce but will probably be 

absorbed by tenants who will pay increased rents.’ ” (Id. at p. 

1199.) “Because of the practical impossibility of obtaining expert 

knowledge of all the components of an apartment, landlords must 

rely on others for their safe manufacture, installation and repair. 

In this respect, landlords are in no better position to know of 

defects than are tenants.” (Id. at p. 1209.) 

By contrast, Amazon is in a better position than its 

customers to learn of and to combat defects in products on its 

website.

4

Parsons v. Crown Disposal Co. (1997) 15 Cal.4th 456 

(Parsons) is conceptually similar to O’Neil and Peterson. Darrell 

Parsons was riding his horse on an urban bridle path when a 

truck noisily lifted a nearby trash bin. The crashing sound made 

the horse bolt, throwing Parsons to the ground. (Id. at p. 462.) 
18

Parsons sued the trash company. The Supreme Court ruled the 

company owed Parsons no tort duty. The Supreme Court used a 

“social utility analysis” to evaluate accident avoidance measures 

the trash company could have taken: “changing the hours of 

collection, temporarily ‘blocking off’ the area with warning cones 

or tape, posting warning signs, providing riders with a schedule 

of collection times, or a combination of these methods.” (Id. at p. 

474.) The court rejected Parsons’s proposals because they would 

increase “the burden on machine operators over what was 

considered reasonable.” (Ibid.) These precautions “unreasonably 

would impair the utility” of the trash company, which ran a 

business “of high social utility.” (Ibid.) And imposing these 

duties on the trash company would imply similar restrictions on 

a wide “range of socially useful activities that may produce such 

noises and provoke such fright.” (Id. at pp. 474–475.) 

The Supreme Court illustrated its cost-benefit analysis 

with commonsense examples: 

“Should a homeowner whose property abuts this extensive 

bridle path (or who has horse-owning neighbors) be obligated to 

peek over his or her six-foot fence to make sure that no horse is 

near before starting a power lawn mower? Should he or she be 

required somehow to keep a constant lookout while mowing the 

lawn, lest he or she frighten a horse that approaches shortly after 

lawn mowing begins? Should a homeowner or building contractor 

be obligated to undertake similar procedures before and during 

use of chain saws, leaf blowers, or other loud power tools? What 

about noise from passing cars and trucks on the adjacent 

highways, or from a picnicker’s radio, or from an emergency siren 

or alarm, or from a jetliner’s sonic boom? We conclude that 

imposing a duty in the present case to guard against fright to a 
19

horse might well subject all manner of actors to the same duty 

and potential liability, with obvious and detrimental 

consequences stifling to the community.” (Parsons, supra, 15 

Cal.4th at p. 475, emphasis in original.)

In short, this seat-of-the-pants cost-benefit analysis showed 

the accident avoidance Parsons had proposed for the trash 

company was not worth its cost. These proposed safety measures 

were just as obviously inefficient as lookouts on 1919 trucks to 

see if the coal-oil lamp was still lit. (Cf. Grady, The American 

Negligence Rule (2019) 53 Val.U. L.Rev. 545, 576 [Parsons

basically held the untaken precautions “flunked the Learned 

Hand formula”].) 

When accident avoidance will be costly and ineffective, the 

Supreme Court refuses to burden defendants with tort duties. 

Amazon loses under this rule, for it can take cost-effective actions 

to minimize the cost of accidents. Indeed, it claims it already 

does.

The same rule explains the lower court California cases on 

which Amazon relies. These Court of Appeal decisions concern 

two situations: secondhand dealers and finance lessors. We treat 

each in turn.

5

The secondhand dealer cases declined to impose a duty in 

strict liability because the dealers were unable to take costeffective measures to minimize accidents from the secondhand 

machines they sold. 

Wilkinson v. Hicks (1981) 126 Cal.App.3d 515 (Wilkinson) 

is representative. Robert Wilkinson injured his hand operating a 

50-year-old Niagara punch press at the Mac Smith Company. 

Benmatt Industries owned the press for many years. Then 
20

defendant Roy Hicks, a dealer in secondhand industrial 

machinery, bought it from Benmatt and sold it “as is” to Mac 

Smith Company. Wilkinson sued Hicks, but the trial court 

disallowed the strict liability claim. Only the negligence action 

went to the jury, which ruled against plaintiff Wilkinson. (Id. at 

pp. 516–519.)

On appeal, the court affirmed secondhand dealer Hicks 

owed no strict liability duty to Wilkinson. Imposing strict 

liability on secondhand dealers would require them “routinely to 

dismantle, inspect for latent defects, and repair or recondition 

their products.” (Wilkinson, supra, 126 Cal.App.3d at p. 521.) 

That rule “would effect a radical change in the nature of the used 

product market, which would deprive that market of [its] 

desirable flexibility.” (Ibid.) The proposed rule would make used 

goods dealers the insurers of the goods they sold. (Ibid.) This 

would increase the prices of secondhand goods. (Id. at p. 520.)

In a nutshell, plaintiff Wilkinson proposed requiring 

secondhand dealers to take expensive safety measures: 

dismantling, inspecting, repairing, and granting a mandatory 

warranty. The court, quite reasonably, was not convinced these 

steps were cost-effective in light of the existing strict liability 

duties on the original manufacturer and its original distribution 

network. Wilkinson’s proposed safety measures were too 

expensive and ineffective to be socially desirable. So Hicks owed 

no strict liability duty to Wilkinson. (Accord, Brejcha v. Wilson 

Machinery, Inc. (1984) 160 Cal.App.3d 630; Tauber–Arons 

Auctioneers Co. v. Superior Court (1980) 101 Cal.App.3d 268.) 

In contrast, the measures Amazon can take to minimize the 

cost of accidents are cost-effective and socially efficient. 
21

6

The same principle guided the finance lessor decision in 

Arriaga v. CitiCapital Commercial Corp. (2008) 167 Cal.App.4th 

1527. Guillermo Arriaga suffered a work injury while operating 

a glue spreader machine. Black Bros. manufactured the glue 

spreader and sold it to Klors, which resold it to CitiCapital 

(actually, its predecessor, which we ignore), which leased it to 

AVP, which sold it to Orepak, which employed Arriaga. (Id. at 

pp. 1532–1533.) The injured Arriaga sued many parties, 

including CitiCapital. The court analogized CitiCapital’s role to 

that of a bank that loaned purchase money to AVP. (Id. at p. 

1536.) The court refused to put a duty of strict liability on 

CitiCapital in part because the court could not see what 

CitiCapital might do to “enhance product safety.” (Id. at p. 1537.) 

“[T]he finance lessor is not in any position to either directly or 

indirectly exert pressure on the manufacturer to enhance the 

safety of the product.” (Id. at p. 1538; see also ibid. [“the finance 

lessor does not have control over, or a substantial ability to 

influence, the manufacturing or distribution process”]; id. at 1539 

[“the finance lessor’s relationship with a particular manufacturer 

does not, in the normal course, possess the continuity of 

transactions that would provide a basis for indirect influence over 

the condition and safety of the product”].) 

In short, there was no action, let alone any cost-effective 

action, the finance lessor could take to reduce the likelihood of 

glue spreader accidents. The Arriaga court thus refused to 

impose tort duties on the finance lessor. The contrast with 

Amazon’s situation is obvious.

* * * * * * *
22

Amazon’s citations thus offer it no support. All involve 

defendants who, unlike Amazon, had no cost-effective way to 

reduce the costs of accidents.

This case is easy. Amazon is well situated to take costeffective measures to minimize the social costs of accidents. 

Strict liability will prompt this beneficial conduct. Loomis wins 

this appeal. The case will return to the trial court for resolution 

of issues the appeal has not addressed.

WILEY, J.