They don't have to assume the whole liability - they can have a supplier contract that passes through all the liability costs (or part of it) to the supplier. In fact, as I understand, Amazon already does that. It's just that Amazon would become the first station to sue if the consumer is wronged. Nothing prevents the Amazon from passing the responsibility by either suing the supplier in turn or forcing them to join the lawsuit. What Amazon wanted is to be completely out of the picture, but the court denied them this. I don't think this invalidates the whole model - they still can act as a middleman, maybe just be a bit more careful with especially shady suppliers.