diff --git a/src/main/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumer.java b/src/main/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumer.java
index 33187ad7..d7a5545e 100644
--- a/src/main/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumer.java
+++ b/src/main/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumer.java
@@ -406,7 +406,7 @@ class ShardConsumer {
         if (taskOutcome == TaskOutcome.END_OF_SHARD) {
             markForShutdown(ShutdownReason.TERMINATE);
         }
-        if (isShutdownRequested() && taskOutcome != TaskOutcome.FAILURE) {
+        if (isShutdownRequested()) {
             currentState = currentState.shutdownTransition(shutdownReason);
         } else if (taskOutcome == TaskOutcome.SUCCESSFUL) {
             if (currentState.getTaskType() == currentTask.getTaskType()) {
diff --git a/src/test/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumerTest.java b/src/test/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumerTest.java
index 1858e07c..0bd2f31a 100644
--- a/src/test/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumerTest.java
+++ b/src/test/java/com/amazonaws/services/kinesis/clientlibrary/lib/worker/ShardConsumerTest.java
@@ -40,7 +40,6 @@ import java.util.List;
 import java.util.ListIterator;
 import java.util.Objects;
 import java.util.Optional;
-import java.util.concurrent.CountDownLatch;
 import java.util.concurrent.ExecutionException;
 import java.util.concurrent.ExecutorService;
 import java.util.concurrent.Executors;
@@ -67,14 +66,12 @@ import com.amazonaws.services.kinesis.clientlibrary.proxies.KinesisLocalFileProx
 import com.amazonaws.services.kinesis.clientlibrary.proxies.util.KinesisLocalFileDataCreator;
 import com.amazonaws.services.kinesis.clientlibrary.types.ExtendedSequenceNumber;
 import com.amazonaws.services.kinesis.clientlibrary.types.InitializationInput;
-import com.amazonaws.services.kinesis.clientlibrary.types.ShutdownInput;
 import com.amazonaws.services.kinesis.clientlibrary.types.UserRecord;
 import com.amazonaws.services.kinesis.leases.impl.KinesisClientLease;
 import com.amazonaws.services.kinesis.leases.interfaces.ILeaseManager;
 import com.amazonaws.services.kinesis.metrics.impl.NullMetricsFactory;
 import com.amazonaws.services.kinesis.metrics.interfaces.IMetricsFactory;
 import com.amazonaws.services.kinesis.model.Record;
-import com.amazonaws.services.kinesis.model.Shard;
 import com.amazonaws.services.kinesis.model.ShardIteratorType;
 
 /**
@@ -421,127 +418,6 @@ public class ShardConsumerTest {
         file.delete();
     }
 
-    private static final class TransientShutdownErrorTestStreamlet extends TestStreamlet {
-        private final CountDownLatch errorShutdownLatch = new CountDownLatch(1);
-
-        @Override
-        public void shutdown(ShutdownInput input) {
-            ShutdownReason reason = input.getShutdownReason();
-            if (reason.equals(ShutdownReason.TERMINATE) && errorShutdownLatch.getCount() > 0) {
-                errorShutdownLatch.countDown();
-                throw new RuntimeException("test");
-            } else {
-                super.shutdown(input);
-            }
-        }
-    }
-
-    /**
-     * Test method for {@link ShardConsumer#consumeShard()} that ensures a transient error thrown from the record
-     * processor's shutdown method with reason terminate will be retried.
-     */
-    @Test
-    public final void testConsumeShardWithTransientTerminateError() throws Exception {
-        int numRecs = 10;
-        BigInteger startSeqNum = BigInteger.ONE;
-        String streamShardId = "kinesis-0-0";
-        String testConcurrencyToken = "testToken";
-        List<Shard> shardList = KinesisLocalFileDataCreator.createShardList(1, "kinesis-0-", startSeqNum);
-        // Close the shard so that shutdown is called with reason terminate
-        shardList.get(0).getSequenceNumberRange().setEndingSequenceNumber(
-                KinesisLocalFileProxy.MAX_SEQUENCE_NUMBER.subtract(BigInteger.ONE).toString());
-        File file = KinesisLocalFileDataCreator.generateTempDataFile(shardList, numRecs, "unitTestSCT002");
-
-        IKinesisProxy fileBasedProxy = new KinesisLocalFileProxy(file.getAbsolutePath());
-
-        final int maxRecords = 2;
-        final int idleTimeMS = 0; // keep unit tests fast
-        ICheckpoint checkpoint = new InMemoryCheckpointImpl(startSeqNum.toString());
-        checkpoint.setCheckpoint(streamShardId, ExtendedSequenceNumber.TRIM_HORIZON, testConcurrencyToken);
-        when(leaseManager.getLease(anyString())).thenReturn(null);
-
-        TransientShutdownErrorTestStreamlet processor = new TransientShutdownErrorTestStreamlet();
-
-        StreamConfig streamConfig =
-                new StreamConfig(fileBasedProxy,
-                        maxRecords,
-                        idleTimeMS,
-                        callProcessRecordsForEmptyRecordList,
-                        skipCheckpointValidationValue, INITIAL_POSITION_LATEST);
-
-        ShardInfo shardInfo = new ShardInfo(streamShardId, testConcurrencyToken, null, null);
-        ShardConsumer consumer =
-                new ShardConsumer(shardInfo,
-                        streamConfig,
-                        checkpoint,
-                        processor,
-                        leaseManager,
-                        parentShardPollIntervalMillis,
-                        cleanupLeasesOfCompletedShards,
-                        executorService,
-                        metricsFactory,
-                        taskBackoffTimeMillis,
-                        KinesisClientLibConfiguration.DEFAULT_SKIP_SHARD_SYNC_AT_STARTUP_IF_LEASES_EXIST);
-
-        assertThat(consumer.getCurrentState(), is(equalTo(ConsumerStates.ShardConsumerState.WAITING_ON_PARENT_SHARDS)));
-        consumer.consumeShard(); // check on parent shards
-        Thread.sleep(50L);
-        consumer.consumeShard(); // start initialization
-        assertThat(consumer.getCurrentState(), is(equalTo(ConsumerStates.ShardConsumerState.INITIALIZING)));
-        consumer.consumeShard(); // initialize
-        processor.getInitializeLatch().await(5, TimeUnit.SECONDS);
-
-        // We expect to process all records in numRecs calls
-        for (int i = 0; i < numRecs;) {
-            boolean newTaskSubmitted = consumer.consumeShard();
-            if (newTaskSubmitted) {
-                LOG.debug("New processing task was submitted, call # " + i);
-                assertThat(consumer.getCurrentState(), is(equalTo(ConsumerStates.ShardConsumerState.PROCESSING)));
-                // CHECKSTYLE:IGNORE ModifiedControlVariable FOR NEXT 1 LINES
-                i += maxRecords;
-            }
-            Thread.sleep(50L);
-        }
-
-        // Consume shards until shutdown terminate is called and it has thrown an exception
-        for (int i = 0; i < 100; i++) {
-            consumer.consumeShard();
-            if (processor.errorShutdownLatch.await(50, TimeUnit.MILLISECONDS)) {
-                break;
-            }
-        }
-        assertEquals(0, processor.errorShutdownLatch.getCount());
-
-        // Wait for a retry of shutdown terminate that should succeed
-        for (int i = 0; i < 100; i++) {
-            consumer.consumeShard();
-            if (processor.getShutdownLatch().await(50, TimeUnit.MILLISECONDS)) {
-                break;
-            }
-        }
-        assertEquals(0, processor.getShutdownLatch().getCount());
-
-        // Wait for shutdown complete now that terminate shutdown is successful
-        for (int i = 0; i < 100; i++) {
-            consumer.consumeShard();
-            if (consumer.getCurrentState() == ConsumerStates.ShardConsumerState.SHUTDOWN_COMPLETE) {
-                break;
-            }
-            Thread.sleep(50L);
-        }
-        assertThat(consumer.getCurrentState(), equalTo(ConsumerStates.ShardConsumerState.SHUTDOWN_COMPLETE));
-
-        assertThat(processor.getShutdownReason(), is(equalTo(ShutdownReason.TERMINATE)));
-
-        executorService.shutdown();
-        executorService.awaitTermination(60, TimeUnit.SECONDS);
-
-        String iterator = fileBasedProxy.getIterator(streamShardId, ShardIteratorType.TRIM_HORIZON.toString());
-        List<Record> expectedRecords = toUserRecords(fileBasedProxy.get(iterator, numRecs).getRecords());
-        verifyConsumedRecords(expectedRecords, processor.getProcessedRecords());
-        file.delete();
-    }
-
     /**
      * Test method for {@link ShardConsumer#consumeShard()} that starts from initial position of type AT_TIMESTAMP.
      */