By Eleni Poulos

 

Websites such as eBay and Amazon have allowed online shopping to flourish in the last ten years. With COVID-19 and quarantines across the United States and the world, e-commerce has only continued to increase tenfold.[1] But with an increase in e-commerce, what protections are afforded to consumers and what can producers be held liable for?

 

Protections for consumers were first introduced in the 1980s, as members of Congress became increasingly concerned with the lack of governance on the issue.[2] As a response for their growing concerns, the Computer Fraud and Abuse Act was enacted, which “prohibits anyone from accessing a computer or computer network without the owner’s consent.”[3]As internet presence increased, the legislation was extended to protect against e-commerce fraud, as well.[4]

 

Additionally, the Restore Online Shoppers’ Confidence Act (ROSCA) was passed in 2010.[5] A main feature of the legislation protects the consumer from third-party payment processors from selling online shoppers’ information.[6] The legislation also protects consumers from unknowingly signing up for a subscription or reoccurring charge by requiring a company to disclose all material terms of the transaction” before consumers are required to submit billing information.[7]Furthermore, other federal laws include the Fair Credit Billing Act, which allows consumers to dispute any charges that were never made, charges that were incorrect, or goods that were not delivered.[8] Federal law further requires that all items ordered online be shipped within 30 days.[9] The Electronic Signatures in Global and National Commerce Act was passed with the goal of ensuring consumers have provided “adequate consent to an electronic transaction.”[10]

 

In addition to legislation from Congress, the Federal Trade Commission and the Federal Communications Commission have worked together to provide protections for online consumers.[11] The “Restoring Internet Freedom” Order, signed during Trump’s presidency, essentially eliminates net neutrality policy passed during Obama’s presidency.[12] However, in general, regulation has seen a decrease during Trump’s presidency.[13]

 

In addition to general consumer laws, states have passed legislation more specifically directed towards online purchases by consumers.[14] In 2007, Governor Eliot Spitzer of New York signed a law that gives consumers who purchase items online the same protections had they made those purchases over the phone or through the mail.[15] Some of these protections include the consumers’ ability to cancel orders if the products are not shipped within the required time frame and the producers’ requirement to keep all complaints from consumers.[16]

 

Courts have also furthered protections for the consumers should there be a product defect in a consumer’s purchase. More recently, in California, the court held that an online retailer could be held strictly liable “for the defects in third-party product sold on its website.”[17] Previously, online retailers were shielded from liability claims brought by consumers of third-party products.[18] This issue has expanded to several other states including Pennsylvania, Arizona, and Tennessee.[19]

 

As the world continues to evolve into a more technologically connected world, it is more important than ever for consumers to have under the protections they received from both Congress and the courts, as well as for producers to understand where they may be susceptible to liability.

 

[1] Problems With Online Shopping, Find Law (Mar. 31, 2020), https://www.digitalcommerce360.com/article/coronavirus-impact-online-retail/.

[2] Online Consumer Protection In E-Commerce Transactions – Module 3 of 5, Law Shelf https://lawshelf.com/videocoursesmoduleview/online-consumer-protection-in-e-commerce-transactions-module-3-of-5/.

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id.

[8] Fair Credit Billing Act: What Is It And What Do You Need To Know?, Lexington Law (Nov. 21, 2019),

https://www.lexingtonlaw.com/credit/fair-credit-billing-act#:~:text=The%20Fair%20Credit%20Billing%20Act,and%20undelivered%20goods%20or%20services.

[9] 16 C.F.R. § 435.2 (2014).

[10] Laws Pertaining To Commerce On The Internet, Stimmel Law https://www.stimmel-law.com/en/articles/laws-pertaining-commerce-internet (last visited Oct. 29, 2020).

[11] Online Consumer Protection in E-Commerce Transactions – Module 3 of 5, Law Shelf https://lawshelf.com/videocoursesmoduleview/online-consumer-protection-in-e-commerce-transactions-module-3-of-5/.

[12] Id.

[13] Id.

[14] Laws Pertaining To Commerce On The Internet, Stimmel Law https://www.stimmel-law.com/en/articles/laws-pertaining-commerce-internet (last visited Oct. 29, 2020).

[15] Linda Rosencrance, U.S. State Law Protects Consumers Buying Online, PC World (Jun. 8, 2007), https://www.pcworld.com/article/132733/article.html

[16] See id.

[17] Ryan S. Landis, Crack in the Dam that Shields Online Retail Platforms from Liability for Defective Products from Third-Parties, 10 Nat’l. L. Rev. (Aug. 28, 2020),

https://www.natlawreview.com/article/crack-dam-shields-online-retail-platforms-liability-defective-products-third-parties.

[18] Id.

[19] Id.

Image Source: https://search.creativecommons.org/photos/388e1407-5c17-48ed-98f9-f95b3f7d1f3a

css.php