I just learned about this the hard way - by ordering a defective product from them, going through the hassle of finding out it was defective, reporting this to Amazon, who had me report this to the manufacturer, and when they did not reply, refunded my money to me.
What happened, behind the scenes, must have been this: Amazon asked for their money back from the manufacturer, which gave them the money, because they wanted to continue to do business with Amazon. Amazon then sells more defective products from them. It knows they are defective, but it also knows most buyers will not bother to get a refund.
You gotta be tough when dealing with Amazon.
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