Amazon Settles $30 Million Hoverboard Li-ion Fire Lawsuit

Fraudulent Li-ion powered device sales continue despite explosion, burn, and death risk.

April 20, 2020, Los Angeles, CA – A Nashville family sought $30 million in compensation for a Lithium-ion battery-powered hoverboard fire that destroyed their $1 million home and injured their two children.

The family claimed that Amazon had information about the dangers of the product and knowingly sold it in advance of the 2016 Christmas season fire. The lawsuit says the seller of the hoverboard listed online, "W-Deals," is a sham organization that is registered to an apartment in New York City.

Amazon insisted it was not at fault, blaming the Chinese manufacturer of the hoverboard and the third-party sellers that advertised the toy on its website.

Amazon didn't disclose the details of the settlement.

Amazon has long contended it is only a marketplace and not liable for product liability and injuries from items sold on its website, yet Amazon takes a transaction fee for each item sold. In this unique case, a federal appeals court didn't agree and criticized Amazon for not informing the family and 250,000 other buyers around the Christmas time fire.

SecuringIndustry.com contributed to this report and reached out to Amazon for a comment on the settlement, but the company declined to comment.

Lithium-ion ("Li-ion") 18650 cells (often called batteries) are a very common power source used in battery-packs for laptops, cameras, power tools, and hoverboards, and individually in flashlights, e-cigarette, and vape devices. Eight-thousand individual 18650 cells power a Tesla automobile.

Unscrupulous China salvagers are re-labeling recycled unprotected used cells as "new" with wild capacity claims and selling them online individually and in battery packs at low prices. Overheating and fires turn the individual 18650 cells into exploding bombs with serious or deadly consequences for consumers. Few consumers understand that the individual 18650 cells rarely have the built-in protective circuitry or the venting claimed, which would protect against overcharging, overheating, fires, explosions, or other harmful events.

Two Pennsylvania children, a 10-year-old and 3-year-old, were the first confirmed U.S. hoverboard fire deaths in 2017. Thousands of hospital emergency room visits, hundreds of aircraft fires, dismemberments, hospitalizations, and deaths have been documented from Li-ion batteries.

The Counterfeit Report, a global award-winning consumer advocate and counterfeit watchdog, purchased hundreds of fraudulent 18650 Li-ion batteries from Amazon. The 18650 batteries tested performed at only a fraction of the stated capacity, and none contained the labeled or claimed protective circuitry. Electrical shorting and a fire occurred in one test.

Individual Li-ion sales are prohibited by Amazon policy, yet Amazon continues to be a direct-seller of the dangerous items in addition to enabling and facilitating third-party marketplace sales. Legal notice describing the hazardous and fraudulent sales was sent and acknowledged by both Amazon and Walmart in March 2019. Each continues to sell the items.

LG Chem, a top producer of Lithium-ion batteries, is warning consumers that common individual 18650 Li-ion battery cells are dangerous and potentially deadly items for consumers. Full page Wall Street Journal ads from the company attempt to educate the public about the dangers.