Suspended Amazon seller gets a record breaking award after spending $200000 on legal fees
An Amazon seller in the United States spent 18 months and $200,000 in legal fees fighting for his withheld funds and seized inventory following Seller Account deactivation over authenticity issues. In the end, he received about half the $1.4 million in restitution requested. But the biggest victory was the acknowledgment that the world’s largest online retailer treated him unfairly.
Amazon suspended the seller’s account after suspecting him of selling counterfeit electronics, according to arbitration documents reviewed. Then the company seized $80,000 in his account and 50,000 products stored in its FBA warehouses.
The merchant, who did not wish to disclose his identity, asked for his money and products back, but Amazon ignored him. He couldn’t file a lawsuit because, like all other Amazon sellers, he agreed to arbitration as a condition of selling on the platform.
After reviewing contracts, interviewing witnesses and reading legal arguments, arbitrator awarded the merchant $775,000 in November. He ruled that Amazon had reason to suspect the merchant and was within its rights to suspend his account. But he said the company went too far by ignoring the seller and withholding his products, including many that weren’t suspected of being counterfeit at all.
“Given the vast resources of Amazon,” he wrote, “I would hope that in the future it will devote the resources necessary to treat all of its sellers with respect and some semblance of due process.”
The case provides a rare look inside an arbitration process that lawmakers and regulators say favors Amazon by discouraging sellers who lack the money, time and energy to take on the company.
A report issued last year by the House Judiciary Committee investigating the power of big technology companies revealed that between 2014 and 2019 only 163 merchants—out of the millions who sell on Amazon—had initiated arbitration proceedings against the company. A bill that would end forced arbitration has been discussed in the Senate since 2019, and its advocates hope testimony from Amazon merchants will give it fresh momentum.
The original intent of the 1926 Federal Arbitration Act was to provide a cheaper, faster alternative to settling business disputes than clogging up public courts. In the decades since, U.S. Supreme Court rulings have allowed arbitration to spread further into day-to-day transactions.
Before consumers rent a car or get cellular service, they’re often asked to sign contracts in which they surrender the right to sue and agree to resolve any dispute through arbitration. Some businesses require new workers to agree not to sue as a condition of employment, practices that can let serial sexual harassers remain on the payroll while their victims take confidential settlements and leave.
It looks like lawmakers are finally waking up to the antitrust implications of big companies using arbitration to gain an unfair advantage over smaller ones. “Arbitration functions as a way for Amazon to keep disputes within its control, with the scales tipped heavily in its favor,” the House Judiciary Committee said in its report. “As such, Amazon can withhold payments from sellers, suspend their accounts without cause, and engage in other abusive behavior without facing any legal consequences.”
Amazon has no incentive to change its practices even though they often don’t pass muster with lawyers and retired judges who sideline as arbiters mediating disputes. When merchants prevail, the arbiter’s decision sets no legal precedent, so Amazon can do the same thing over and over, knowing most merchants won’t bother mounting a challenge.
“It’s very expensive and time-consuming, and most small businesses don’t have the money or the time,” says Mario Simonyan, a Burbank, California, attorney. He says most clients decide against launching arbitration cases against Amazon because they typically cost $80,000 in legal fees.
One potential solution is to pass the Forced Arbitration Injustice Repeal Act, which would create a way for Amazon sellers to pursue class-action lawsuits against the company. Jacob Weiss, a home-goods merchant who supports the legislation, testified before the House committee in February. He told lawmakers that, despite spending $50,000 on an arbitration case against Amazon, he failed to recover his losses. Weiss said a second case has dragged on for nine months without resolution.
The anonymous merchant who won his case isn’t waiting for a new law. He paid off debts with the arbitration award and hopes to start a new business “as far away from Amazon as I can get.” His suggestion: “Make the final rulings public so other arbiters can consider them and Amazon won’t lose the argument today and make the same argument with a different arbiter tomorrow and win.”
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Amazon is now giving sellers the exact reason for Restricted Products Removal
If you are a third party seller doing business on Amazon’s platform, you might be already aware that they are rarely providing any clear reason at all for their enforcements. Amazon can remove your listings anytime and if you wish to have them reactivated, you will have to invest a significant amount of time and resources into appealing.
Recently, Amazon started briefly clarifying reasons for listing blocks in relevant notices, which includes those subject to Restricted Products Removal. If you carefully review the wording of e-mail received from Amazon, you will be able to detect, why they were removed.
By the way of example, a recent Restricted Products Removal notice states:
“Jewellery products cannot be described as “8 carat gold”, “10 carat gold” or similar as these are not recognised finesses of gold in the UK. For more info, please see the following; https://sellercentral.amazon.co.uk/gp/help/external/help.html?itemID=201744030&language=en_GB&ref=efph_201744030_relt_201744010”
The text of your notice should address your listing’s specific reasons.
Here you can view an example full e-mail from Amazon regarding Restricted Products Removal:
| Notification of Restricted Products Removal Hello from Amazon, We are writing to let you know that the following detail pages have been removed from our catalog: ASIN: XXX, SKU: XXX, Title: XXX Jewellery products cannot be described as “8 carat gold”, “10 carat gold” or similar as these are not recognised finesses of gold in the UK. For more info, please see the following; https://sellercentral.amazon.co.uk/gp/help/external/help.html?itemID=201744030&language=en_GB&ref=efph_201744030_relt_201744010 Why is this happening? We took this action because this product is not permitted for sale on Amazon.co.uk. It is your obligation to make sure the products you offer comply with all applicable laws, regulations, and Amazon’s policies. What actions do I need to take? – If any of the above ASINs are Fulfillment by Amazon (FBA) offers, please initiate a removal request for the ASIN(s) referenced above to have your inventory sent to a location of your choosing. If you fail to initiate a removal request within 30 days of this notification, we may dispose of it in accordance with the Amazon Services Europe Business Solutions Agreement and FBA policies. For more information on our FBA policies, please review https://sellercentral.amazon.co.uk/gp/help/201030350 and https://sellercentral.amazon.co.uk/gp/help/200140860. – Within 48 hours of this warning, please review your listings and close, delete, or archive any listings that do not comply with all applicable laws, regulations, and Amazon’s policies, including the product(s) listed above. Please note that moving a restricted product listing to Inactive (Out of Stock) does not make the listing compliant. If you think your product was incorrectly identified as a restricted product on Amazon, close the listing immediately to ensure compliance while you appeal the restriction with Seller Support. What happens if I fail to follow the above instructions? Failure to properly close or delete all restricted product listings from your inventory may result in the deactivation of your selling account, and funds may be permanently held. We’re here to help: If you have questions about our restricted products policy, please review: https://sellercentral.amazon.co.uk/gp/help/201743940 Have you received this notification in error? – If you believe the product(s) listed above are permitted for sale on Amazon, please include evidence or documentation demonstrating that your account has not violated our restricted products policy and contact Seller Support: https://sellercentral-europe.amazon.com/cu/contact-us. We will investigate your concern. – If you are unsure, please review: https://sellercentral.amazon.co.uk/gp/help/201743940 before appealing the restriction with Seller Support. You can view your account performance at https://sellercentral-europe.amazon.com/performance/dashboard?reftag=ah_em_rp or select Account Health on the home screen of the Amazon Seller app on your iOS or Android device. The Account Health dashboard shows how well your account is performing in light of the metrics and policy compliance standards required to sell on Amazon. – Download iOS App at https://itunes.apple.com/gb/app/amazon-seller/id794141485?mt=8 – Download Android App at https://play.google.com/store/apps/details?id=com.amazon.sellermobile.android&hl=en_GB We appreciate your cooperation and thank you for selling on Amazon.co.uk. Amazon Services Europe Please note: This e-mail was sent from a notification-only address that cannot accept incoming e-mail. Please do not reply to this message. |
Once you receive a warning like this, and you believe it to be justified, definitely review your listings within 48 hours of the warning and close, delete, or archive any listings that do not comply with all applicable laws, regulations, and Amazon’s policies, including the product(s) listed above.
I hope you found this article helpful. If you are experiencing issues with your Amazon Seller Account and your Seller Account already received a warning or is under a review, I can assist you and help you resolve the matter.
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As you know, Amazon now requires all third party sellers to implement two step verification in order to access their Seller Accounts. Many sellers are reaching out to me and seeking help with regaining access to their accounts when they are unable to perform two step verification.
This may happen when a seller loses their phone, for example. In such case, they will be unable to receive the OTP text code. If Two-Step Verification fails and you can’t access your account, you can try to recover it using alternative means.
To regain access to your account, you’ll need to verify your identity by providing a scan or photo of a government-issued identity document to Amazon. To protect your account, Amazon won’t be able to make changes to your Two-Step Verification settings until your identity is successfully verified. If you are able to sign in to your account, you’ll have access to make changes to your account.
Before you begin account recovery, try to sign in with a registered backup method or from a trusted device.
If you still can’t sign in, to recover your account:
- Go here.
- Follow the on-screen instructions to upload your identity document. Make sure that your name and address, and the issuing authority (e.g., state or country) are visible. Cover, conceal, or remove sensitive information such as account numbers or identification numbers.
The verification process can take 1-2 days to complete. Amazon will e-mail you to confirm once Two-Step Verification has been disabled. You’ll then be able to access your account with only your password.
I hope you found this article helpful. If you are experiencing issues with your Amazon Seller Account and your Seller Account already received a warning or is under a review, I can assist you and help you resolve the matter.
In order to receive a professional advice and get help with your Amazon issue, feel free to subscribe and reach out through my dedicated assistance help page at www.onlyfans.com/kikaangelic, where I provide help with Amazon related matters in exchange for a small $24.99 fee.
If you have an Amazon-related issue, feel free to join and post into my large Amazon Seller Performance – Friendly Advice – Worldwide Facebook group, where you will be very welcome.
Many Amazon sellers recently started trading stocks and crypto currencies, hoping to diversify their income, which is a very good idea with all the uncertainty which comes with the platform. For this reason, we launched a new Facebook group, Crypto Arbitrage Income (Bitcoin, Crypto, Altcoins, Blockchain, Trading) – feel free to join us and forget about the troubles of selling on Amazon for a moment!
In case you are an Amazon Seller who needs help with Seller Identity Verification on Amazon, please feel free to watch my most detailed video on the subject, addressing all common questions:
If you are an Amazon Seller doing business on their US platform, you must have received Amazon’s warning e-mail entitled New requirement for list prices starts June 30 in your inbox. Starting that date, Amazon will require any newly created listings to contain the List Price.
If you are wondering why is setting a List Price so important for Amazon, in this article I will be addressing your concerns. Whilst it will only take you a few seconds to update any listing with a List Price, you may not be aware of its pros and cons.
Once you upload the List Price, Amazon will save this figure as the product’s RRP. When you try to decrease or increase the product price later, your listing will get automatically deactivated over a Potential high / low pricing error or you will lose the BuyBox.
This is why you should carefully rethink whether you will provide this attribute on your existing listings and what figure will be entered as the List Price.
On the other hand, List Price can be a good idea when you have an otherwise expensive product, which you intend to sell at a significant discount. It is then shown as a strike-through Recommended Retail Price making the savings visible on the product detail page. Displaying the RRP when you are offering a price that is below it, will help customers understand the value of your offer, which may help to increase conversion.
If you do not have a ready-to-provide list price, Amazon suggests that a possible value could be the first price at which you have offered or will be offering the product. You can also provide a value of 0 to indicate that you do not have a list price.
Here you can view a copy of the wording of Amazon’s e-mail regarding the matter:
| New requirement for list prices starts June 30 Hello, You are receiving this email because you have previously added offers for certain product types that commonly include list prices. Beginning June 30, 2023, we will require the “List price” (also referred to as a Manufacturer’s Suggested Retail Price) attribute to be completed for these product types. Your existing offers will not be affected by this change. Rather, when you create a new item listing, or when you edit an existing listing, you will see a prompt to fill out the “List price” attribute. If you do not have a ready-to-provide list price, a possible value could be the first price at which you have offered or will be offering the product. You can also provide a value of 0 to indicate that you do not have a list price. For more information, go to “Product type and attributes”: https://sellercentral.amazon.com/gp/help/GYV2F6WS9N9FDYD9 You can download the full list of impacted product types from the following link: https://m.media-amazon.com/images/G/01/Product_Types_Requiring_List_Price/Product_Types_Required_List_Price.xlsx For more information on how Amazon uses list prices, go to “Show a reference price on your products by providing a List Price”: https://sellercentral.amazon.com/gp/help/G27XM55CQM3SBMD2 The Amazon Services team |
I hope you found this article helpful. If you are experiencing issues with your Amazon Seller Account and your Seller Account already received a warning or is under a review, I can assist you and help you resolve the matter.
In order to receive a professional advice and get help with your Amazon issue, feel free to subscribe and reach out through my dedicated assistance help page at www.onlyfans.com/kikaangelic, where I provide help with Amazon related matters in exchange for a small $24.99 fee.
If you have an Amazon-related issue, feel free to join and post into my large Amazon Seller Performance – Friendly Advice – Worldwide Facebook group, where you will be very welcome.
Many Amazon sellers recently started trading stocks and crypto currencies, hoping to diversify their income, which is a very good idea with all the uncertainty which comes with the platform. For this reason, we launched a new Facebook group, Crypto Arbitrage Income (Bitcoin, Crypto, Altcoins, Blockchain, Trading) – feel free to join us and forget about the troubles of selling on Amazon for a moment!
In case you are an Amazon Seller who needs help with Seller Identity Verification on Amazon, please feel free to watch my most detailed video on the subject, addressing all common questions:
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