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Berkley loses ruling in fire damage from battery sold through Amazon

Posted On: Jan. 26, 2023 2:32 PM CST

Berkley Inc. is not liable under Minnesota law for the more than $3 million in fire damage allegedly caused by a cellphone battery it sold on behalf of a Chinese company, a federal district court said, in ruling against a W.R. Berkley Corp. unit.

Berkley unit Berkley Regional Insurance Co. provided property and casualty insurance to Minneapolis-based Schoeneckers Inc., a financial services company that conducts business as BI Worldwide, according to Tuesday’s ruling by the U.S. District Court in St. Paul, Minnesota, in Berkley Regional Insurance Co. v. John Doe Battery Manufacturer; Shenzhenshi Yishengda Dianzi Youxia Gogsi; Inc.; and Shenzhen Maxpower Technology Co., Ltd.

In November 2018, a BI Worldwide employee purchased a replacement cell phone battery on Amazon’s online marketplace from Shenzhenshi Yishengda. The cellphone caught fire and damaged BI Worldwide’s office. Berkley paid the company more than $3 million under its coverage for the damage.

The insurer then filed a products liability lawsuit against defendants including Amazon. 

“In summary, under Minnesota law, strict product liability applies only to manufacturers and sellers of defective products,” the ruling said. “Amazon undisputedly did not manufacture the alleged defective battery in this case.

“The uncontroverted evidence does not demonstrate that Amazon either sold the battery through a transfer of ownership or otherwise distributed the battery based on how those terms have been defined and described” in the law and Minnesota court decisions.

“Rather, the evidence reflects that Amazon acted as a distribution facilitator,” which under Minnesota law is expressly exempted from strict liability, the court said, in granting Amazon’s motion for summary judgment and refusing to certify the case to the Minnesota Supreme Court.

Attorneys in the case did not respond to requests for comment.