Alibaba Group Holding, Inc. (NYSE:BABA) is reportedly facing a legal challenge in the U.S. over a defective product that was sold on its website.
Parents of a San Francisco man, who died in 2020 when the 3D printer caught fire, have sued Alibaba over allegedly selling a defective device through its U.S. website, called AliExpress, Bloomberg reported.
The printer was reportedly manufactured by Chinese electronics company Tronxy Technology.
Investigators concluded that the fire was caused due to overheating of the printer, which set the couch on fire, the report said, citing the parents. The deceased person reportedly used the printer as intended at his house.
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Recently, there has been a spate of incidents, where customers held marketplaces responsible for the goods purchased on their sites, even if meant that the seller was a third-party, Bloomberg said.
Pressured by the development, Amazon, Inc. (NASDAQ:AMZN) announced a new policy in September last that would require it to pay for injury or property claims, valued at less than $1,000. For amounts exceeding the limit, the company said it is not liable.
Alibaba closed Wednesday's session up 14.67% at $119.62, according to Benzinga Pro data.
