Provides that an electronic marketplace provider shall be deemed to be a retailer for purposes of New York strict liability law and shall be strictly liable for all damages caused by defective products placed into the stream of commerce to the same extent that a retailer of that defective product would be liable.
STATE OF NEW YORK
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6437
2023-2024 Regular Sessions
IN SENATE
April 19, 2023
___________
Introduced by Sen. HOYLMAN-SIGAL -- read twice and ordered printed, and
when printed to be committed to the Committee on Judiciary
AN ACT to amend the general obligations law, in relation to the liabil-
ity of electronic marketplaces for compensation for damages for defec-
tive goods
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The general obligations law is amended by adding a new
2 section 11-108 to read as follows:
3 § 11-108. Liability of electronic marketplaces for compensation for
4 damages for defective goods. 1. As used in this section:
5 (a) "Electronic marketplace provider" means a person who, pursuant to
6 an agreement with a marketplace seller, sells or facilitates sales of
7 tangible personal property by such marketplace seller or sellers via an
8 internet website, online catalog, mobile application, or similar forum.
9 "Electronic marketplace provider" includes any subsidiaries or related
10 party companies. A person "facilitates sales of tangible personal prop-
11 erty" for purposes of this paragraph when the person meets both the
12 following conditions:
13 (i) such person provides the forum in which, or by means of which, the
14 sale takes place or the offer of sale is accepted, including an internet
15 shop, store, booth, application, website, catalog, or similar forum; and
16 (ii) such person or an affiliate of such person collects the receipts
17 paid by a customer to a marketplace seller for a sale of tangible
18 personal property, or contracts with a third party to collect such
19 receipts.
20 (b) "Handmade" means a product that conforms to all applicable state
21 and federal consumer health and safety laws and is made by the market-
22 place seller in the primary residence of the marketplace seller, so long
23 as the marketplace seller's sales of handmade products generate less
24 than fifty thousand dollars per year in revenues.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10447-01-3
S. 6437 2
1 (c) "Marketplace seller" means any person who has an agreement with an
2 electronic marketplace provider under which the electronic marketplace
3 provider will facilitate sales of tangible personal property by such
4 person within the meaning of paragraph (a) of this subdivision.
5 (d) "Product" means a tangible good that is subject to strict product
6 liability law.
7 2. An electronic marketplace provider shall be deemed to be a retailer
8 for purposes of New York strict liability law and shall be strictly
9 liable for all damages caused by defective products placed into the
10 stream of commerce to the same extent that a retailer of that defective
11 product would be liable. The liability of an electronic marketplace
12 provider shall be equal to, but not greater than, the liability of a
13 retailer, and all defenses to strict liability that are available under
14 New York law, except as modified by this section, shall be preserved for
15 electronic marketplace providers.
16 3. This section shall apply:
17 (a) without regard to fault;
18 (b) regardless of whether the electronic marketplace provider or
19 marketplace seller has a physical presence in the state; and
20 (c) regardless of whether the electronic marketplace provider ever
21 took physical possession of, or title to, the product.
22 4. An electronic marketplace provider shall not be liable as described
23 in subdivision two of this section if any of the following conditions
24 are met:
25 (a) The product that caused the damage was one of the following:
26 (i) preowned or used and prominently described or prominently adver-
27 tised in the electronic marketplace provider as preowned or used at the
28 time it was purchased by the consumer; or
29 (ii) handmade; or
30 (iii) custom-made.
31 (b) The electronic marketplace provider did not receive a direct or
32 indirect financial benefit from the sale of the defective product that
33 caused the injury. A fee that is exclusively for an advertisement is not
34 a "financial benefit from the sale of the defective product."
35 5. Notwithstanding the provisions of subdivision four of this section,
36 an electronic marketplace provider shall be strictly liable for the sale
37 of preowned, used, handmade, or custom-made defective products if the
38 application of strict liability to the electronic marketplace provider
39 is consistent with the policy considerations underlying strict product
40 liability.
41 6. This section shall not be deemed to limit or impair any cause of
42 action authorized pursuant to any other provision of law available to a
43 person injured as a result of a product. The provisions of this section
44 shall be in addition to any other right of action or recovery otherwise
45 available under the law.
46 § 2. This act shall take effect immediately.
