False Infringement Claims are Rife on Amazon

How unethical sellers abuse the system with bogus IP, trademark, copyright and patent reports

This post is by Chris McCabe, a former Amazonian and founder of ecommerceChris.com. For Amazon sellers, having their merchant account suspended means losing time and money trying to get back in business. ecommerceChris shows sellers how to keep their accounts healthy, or, if the worst should happen, how to get their account back from a suspension.

UPDATE FEB 2017: A follow-up to this post, How to Fight Amazon Rights Infringement Claims, covers Amazon’s changing attitude to false claims, how to create a Plan of Action, and how to file a DMCA counterclaim.

As demonstrated in a recent CNBC article about Samsung sales, Amazon scarcely has any process in place to vet disputes over sales rights or to filter counterfeit claims from alleged rights owners.

In order to meet a minimum liability standard, Amazon only acts upon properly submitted and completed notice claims of infringement. They notify specified marketplace sellers which party reported them on what listing, and how to reach that would-be rights owner via email. The rest is up to you.

Unfortunately, now word is out that anyone could submit a form without any true vetting or verification process on the other side. Investigators merely check the form for completed content in all the right spaces. They don’t independently verify that any of the information is actually correct, or valid. The rights owner makes a legally-binding declaration in the form, and signs it. What if you can’t locate a party who submits a false form?

If anything there does not square with reality, then it’s up to you to chase them down.

Surprised Man
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What is a Rights Owner Infringement?

There are different kinds of infringement complaints submitted to Amazon for review and action. It’s important to differentiate between counterfeit and Rights Owner infringement because Amazon treats them differently.

For a counterfeit complaint, Amazon asks the alleged counterfeiter for supply chain documentation. If you’re accused of selling inauthentic product, and especially if there’s a test buy involved from the buyer or accusing seller, you’ll need to provide as much documentation leading back to the brand or manufacturer as possible. If this means adding a letter from your distributor asserting, on their company letterhead, where they sourced the items, then so be it.

For Rights Owner complaints submitted via this form, Amazon removes the listing pending contact from the complainant. They need to hear directly from the rights owner in order to reinstate your listing. A Rights Owner complaint could be due to patent, copyright, or trademark infringement.

A patent infringement on Amazon means selling, or offering to sell, a patented invention without the permission of the patent owner.

Broad actions taking down not just groups of listings but entire accounts are common.

A copyright infringement is using other people’s images or text without authorization to use it on Amazon. Product listings, physical products, and packaging cannot include copyright content or images. Submission of a form indicating a copyright violation results in a listing removal and warning, at a minimum. Enough of these could result in a suspension.

Trademark infringement concerns symbols or words that are registered to a specific company or product. These may not be used or reproduced (i.e. counterfeit) without authorization. Some recent trademark claims, even for first time offenders, result in suspensions if the brand is sufficiently hot-button, like Apple. Whether you get a warning or an outright account suspension can depend on the brand that submits the complaint.

There’s evidence that all brands are paying a lot more attention to sales of their products on Amazon, and organizations like the NFL and MLB are stirring up concern internally at Amazon. Broad actions taking down not just groups of listings but entire accounts are common.

What’s Going On? A Quick Rundown

Amazon never gives out anything beyond an email address and does not vet the party submitting the form, but why? Internal policy directs investigators to take minimum action only to prevent dispute mediation around rights ownership.

Amazon assumes no liability for identifying true versus false rights owners

Amazon assumes no liability for identifying true versus false rights owners, they merely assess the documents in front of them as complete, look for the named seller storefronts and selected ASINs, and warn or suspend the targeted seller. They refuse to get involved beyond that line unless compelled legally.

While Amazon teams may only extend themselves as far as Amazon Legal will let them, we can’t consider the results anything less than a spectacular policy failure. Notice forms roll in hourly with no definitive proof of true rights ownership and Amazon teams continue to enforce them as legitimate. Listings are cancelled, sellers are warned, top-selling ASINs drop out of your active listings and increasingly, sellers find themselves suspended first, with questions asked later.

Amazon wants to avoid any chance that they could be missing reports of fake products or counterfeit items, and needs to take every step possible to ensure they err on the side of aggression. But the net effect on the marketplace itself is to undermine a seller’s sense of any protection or any real control of this entire process.

Why is This Happening?

Several factors have led us to this point. Long ago in a galaxy a bit too close to all of us, some devious and over-competitive sellers looking for weak systems to exploit came up with an idea: why don’t we accuse our competitors on a listing of violating our rights ownership? We’ll just give a token email address to Amazon and let them hammer our competition.

You can take shots at another seller from a free email address and watch your competition fall.

Amazon does not require rights owners to have any seller accounts at all, of course. So why not simply provide a freshly created free email address as the contact point, and name our target and the ASINs? Will Amazon find the time or interest to figure out who we are? Or will they simply take the listings down, and warn the seller?

The answer came back definitively on one side. You can take shots at another seller from an email address not associated with a seller account, and watch your competition fall. Enough rights owner violations coming in naturally lead investigators to suspend the account you’ve targeted. If anyone emails asking to resolve the claim, you can simply ignore it.

So the question becomes this: Why is Amazon handling these matters in this way? Are they simply trying to make 100% sure they prevent any potential litigation from brand owners after all the tussle around counterfeit sales on the site?

1. No real motivation to change

Amazon has little driving it to spend more time, effort, resources or energy on verifying legitimate rights owners. If their legal counsel advised them that they are not responsible for conducting research in the outside world regarding proper rights ownership information, they ultimately won’t bear the cost nor the liability. This view has been in place for several years and no external pressures rose up to challenge their methods.

2. No headcount for it, nor an ability to scale the work

Amazon is not interested in having dozens of investigators run down and check out who is truly the legal rights owner of a certain product’s sale or distribution, and who is not. That would require additional training of their Notice squad, and new hires with legal or paralegal type backgrounds.

Policy teams struggle as it is to meet service level agreements on their main email queues and usually face criticism for auto-response level quality. Adding this kind of work would water down the quality of their investigations ever further.

3. Is anyone really following this?

Amazon has not received much bad press nor public commentary on this question, outside of the usual seller forums and Facebook groups. Those readers are usually sellers who are preaching to the choir. To Amazon seller consultants like me, it’s an obvious area for public complaint. For sellers, it’s a known problem that they pray will never affect them personally.

Word is out among those most interested in abusing these processes, and pushing through forms that don’t reflect accurate or even good-faith rights ownership. Bad actors know that Amazon refuses to vet those forms beyond the above criteria, and also that Amazon won’t reject claims because they only have a free email address to send to the unsuspecting target. Once sellers know that the party in the middle with all of the authority will not intervene, it’s open season on everyone.

4. What plays out in the courts?

Not a lot that affects Amazon, apparently. If sellers sue each other claiming rights ownership violations, the only impact on Amazon is lost sales on a particular item. It’s one drop in an ocean of feverish sales and commissions for them.

If Amazon itself is sued, they can come back with a well-funded legal team. Are many sellers planning to do that? If they do marshal the financial resources, how long will it take? Will they win? But if Amazon loses a high-profile lawsuit because they failed to protect a rights owner, or they took action based on an inaccurate rights ownership claim, you’ll hear about it. Until then…

5. Is Amazon going to change this anytime soon?

Not from what I can see, until they are properly motivated or receive some incentive to do so. They’ve ignored improvement needs on both Seller Performance and Product Quality team matters for the last couple of years, and only recently have they shown any interest in commenting publicly on those shortcomings. They don’t currently fear public discussion of this subject.

I’ve detected no new evaluation of the notice queues, the teams that handle them, or any interest in making the marketplace a platform where sellers can sell without fear of account closure from false infringement forms. Sellers are on their own and left to their own devices, legal or otherwise. Unless an external party forces Amazon to confront this nightmare, they don’t need to allocate resources, financial or otherwise, to rectify this gaping hole.

OK, So What Do I Do?

What can you, as an Amazon seller and not a mini-god, do to reduce the chance that Amazon will take your entire account down after illegitimate claims of infringement? In an atmosphere where Amazon deflects any attempt to involve them in a rights-owner dispute, you may need to consider multiple avenues towards resolution.

1. Contact the rights owner

Try to contact the rights owner at the address provided, just in case they do in fact reply with any additional and helpful information. If you can resolve it with the alleged rights owner and if they are willing to contact Amazon to retract the form, that is the best of all outcomes. If you can fix the problem in the short and sweet way, do it.

In speaking with Private Label Lawyer Suzi Hixon on this subject, she indicated: “unless you can provide a valid reason as to why you were infringing the intellectual property rights of another seller, it’s unlikely the rights’ owner will have any reason to retract. If you are going to request retraction of a complaint, make sure you also provide an incentive to the rights’ owner to retract.”

2. Send a lawyer’s letter

In the absence of any reply from the supposed rights owner, have your attorney draft a letter on law firm letterhead to send to that party (or their attorney), and gauge the response, if any. If there’s no reply and there’s no evidence that the rights owner has anything to show for their ownership, move on to contacting Amazon and challenging their action.

3. Find and contact the real rights owner.

Hopefully, your supplier can give you the rights owner’s information. It’s worth asking them to supply you with a letter of authorization or even contact Amazon on your behalf. If the supplier will not give you this information, a quick search on the USPTO database may help you identify the rights owner.

Suzi Hixon advises: “You’ll also want to check the USPTO to determine the validity of the infringement claim. For example, make sure the trademark is not an abandoned or canceled trademark. You’ll also need to check the scope of the goods covered by a trademark. Some brands, especially famous brands, are notorious for being a bit overly aggressive in enforcement.”

If you aren’t sure if the alleged rights’ holder can substantiate your claims, you might need to retain an attorney to make sure you aren’t a victim of a bully or troll.

4. Send Amazon your lawyer’s letter

Email Notice teams and Amazon legal with your lawyer’s letter. Are they responsive? Do they ignore you? Has the letter stated the average daily sales you’ve lost due to this action, and due to their unwillingness to verify that an actual rights owner contacted them?

Each attorney will have a different take on this, but make sure you’re using someone who knows what they’re doing, and understands the work itself. There are a lot of quick buck artists out there currently plaguing the Amazon seller marketplace, plugging their “Amazon expertise”, but lacking the credentials to handle these matters. Investigate each attorney thoroughly.

5. Initiate litigation

Are you suspended by Amazon based on wrongly filed rights owner forms? Many of you are as I write this. Have you considered taking legal action to compel Amazon to justify the wrongful closure of your account?

You may have decided that you’ll simply appeal, promising never again to violate another party’s rights, but that represents only a short term solution. This could easily happen to you again and each time you’re suspended, it will get tougher and tougher to get your account back.

6. Take it to the press

A lot of sellers are unwilling to take this step because they fear retribution, or they don’t trust a public party to look after their interests. But is the reporter willing to talk anonymously, or do they demand that the seller identifies themselves? Often, sellers don’t even get to that point; they simply disregard the option. Some don’t understand how speaking “off the record” works while others don’t grasp the simple precautions you can take by contacting a reporter from an untraceable phone, but either way, this is sometimes the only way to get Amazon moving.

If they don’t care about resolving a major problem but the press calls them to get quotes about a story on it, they may suddenly find themselves a bit more interested. Think it over and decide for yourself what you’re willing to describe to someone who wants to hear seller experiences. Do your own research, your own thinking, and decide if you’re speaking to the right person to cover the subject, too.

Where does that leave us?

Amazon has countered seller complaints with PR-type language, contributing to the discussion by stating that it’s a complex issue, and they’re doing everything they possibly can to resolve it the right way.

In the meantime, make sure you’re looking out for yourself, taking the right steps, and not waiting for Amazon to take care of anything for you. It’s not up to them, ultimately, it will be up to you.

Chris McCabe can be contacted via ecommerceChris.com.

Surprised Man
Want to grow your Amazon business?
Automate pricing, request feedback and reviews, improve your marketing & SEO and a lot more. Amazon consultants help with difficult issues like suspension, or help grow your business. All in the Web Retailer directory.
View Amazon Selling Tools Now

22 comments on “False Infringement Claims are Rife on Amazon

  1. What about Amazon’s own policy stating that images on Amazon can be used royalty free?

    When a detail page is created, it becomes a permanent catalog page on Amazon.com that will remain even if the creator’s inventory sells out. Additionally, when you add your copyrighted image to a detail page, you grant Amazon and its affiliates a non-exclusive, worldwide, royalty-free, perpetual, irrevocable right to exercise all rights of publicity over the material.

    1. You grant Amazon the right to use and display the images, as the quoted policy indicates. That does not state anywhere that all sellers can use any image royalty-free. It means that Amazon itself can use it.

      Otherwise, copyright infringement would have no legal meaning on Amazon, which would create a chaotic platform of use and abuse. Anyone could use anyone else’s images, at any time, elsewhere on the site. The way this is phrased demonstrates that you can list against a detail page with someone else’s image — but not to have the right to use it elsewhere, at your own discretion.

      1. Using product photos and text to sell the exact product shown in the photos and described in the text is not copyright infringement. I do not believe the US Copyright Office would accept ordinary product photos or the sorts of descriptions used on product packaging, labels, and listing pages, for registration. Not everything is copyrightable.

  2. We are having this exact same problem at the moment. We did $1.8 million with Amazon in 3 months and now we are suspended indefinitely. We had to let staff go because of our revenue drop.

    We had a customer/seller actually buy hundreds of one product claiming authenticity to try and increase our metrics past the threshold because we were selling it cheaper than them. They threatened to take our business down and Amazon did nothing and would not block the buyer from us. Eventually we had to stop selling the item. After this, we received 6 infringement claims out of nowhere. One responded and removed the complaint, the other 5 have never responded to us in a 6 week period.

    We are completely stuck and did not realise this was apparently such a common theme!

    What a nightmare

    1. Hi, did you hire an attorney to send a letter to the would-be rights owner? That may be a good way to motivate them. Also, there is a new process to dispute notice complaint forms.

      Also, did you have any real proof to show Amazon about the buyer being tied to the seller account? They usually need a good amount of evidence of that.

      1. Hi Chris,

        Our Amazon account manager informed us a two Rights Holders that had validate complaints, but we never received an email from Amazon with a list of ASINS or the Complaint ID number. Without this information, we can file a counterclaim. Any ideas?

  3. This isn’t just an Amazon issue this is a U.S. nationwide issue because of failed government policies within the USPO. Many times you will see works, publications and products claiming to be trademarked, servicemark, copywrited protected, U.S. Patent Pending then you check with the USPO they have no listing or such or any application filed on such; but, that’s to our failed representatives in Washington they have this act called Rights to Privacy, and the USPO can’t investigate any wrongdoing. Isn’t it great we live in a country so scattered brained from false and misrepresenting works. I am an Amazon Associate, and my advice is do your own investigating before acting because if you think you can depend upon rules and regulations from any U.S. bodies forget it they are too stupid and lazy to act on our request. I don’t think Amazon as ones put it is the issue, I think these states government have told Jeff Benzo what he can and can’t do, or close their doors to those particular states. Alabama is a great example, the state is so broke from corrupt internal government they have forced an Amazon tax upon all delivers to Alabama at twice the normal rate of any local stores 8%; so, Amazon must charge for such fee or they can’t deliver to Alabama even thou the U.S. Supreme Court has rules such tax or fee unconstitutional some states will not comply again because we have dummies and lazy leadership in Washington. I never had an issue with Amazon’s policies, it’s these damn U.S. states that is causing the problems and failed government policy; so, next time you vote remember don’t vote to reelected anyone in presence government seats.

    1. Certainly, you can’t take anybody’s word for it. You’d need to do your due diligence to make sure anyone claiming copyright or trademark actually has taken those steps and secured those rights. Thanks for reading.

  4. Fantastic expose from someone who knows first hand what’s going on at Amazon. I am also an Amazon account manager for various companies and brands (I don’t like the title consultant for whatever reason) and I see this becoming such an exploited weakness for sellers that what is coming down the pipe next? Amazon seller account insurance! You’ll soon be seeing financial institutions collecting a monthly fee from fear motivated sellers to guarantee their bi weekly payout should they get suspended and some sort of legal team to help reinstate seller status and draw up action plans etc. crazy as it sounds it equally sounds more and more necessary……

    1. You must have struggled to manage brands for sellers if they were continually fighting off competition doing everything they can to disrupt a proper private label listing right? Well, hopefully there are new brand protection tools coming your way in ’17. Make sure there are disputes sent to Notice queues if anyone claims you’re infringing against their rights. This process needs to expand to include abuse by those who have no right to assert those rights.

      Thanks for reading and commenting.

    1. Right but the article misses one key piece of info, who handles the actual reinstatement work? What’s their background or track record? Ultimately that will be the most important element.

      Interesting to know insurance companies are backing up sellers who need to protect against funds loss. Anything to mitigate risk for those who can’t stay away from the policy teams will make sense for those analyzing the risks properly. Thanks for contributing

      1. Hi Britt. Hopefully someday soon Amazon suspensions won’t last as long because Amazon teams will respond with more clarity, and indicate what might be missing from each Plan of Action or appeal they receive from sellers. If they only did that, they’d reduce the number of emails they get, and the timelines and lost revenue would go down remarkably. I’ll keep agitating for better processes.

        When that happens, insurance won’t be as necessary as it could be now.

  5. Recently received a notice for an asin I had listed

    “We received a report from a rights owner that you are listing counterfeit products. Sellers on Amazon.com are not allowed to create listings or detail pages for counterfeit goods.”

    I had listed (quantity of 1) it but never sold any units. Purchased at legit retail store.

    Do I have any recourse if the rights holder wont remove?

    Seems odd to get a counterfeit claim on something never sold.

  6. I don’t typically see that phrasing. When it does appear, usually it means the rights owner did what’s known as a ‘test buy’ — yet you stated that you haven’t sold any of the items. Was the title incorrect or hinted at branding, but it’s a generic item? Would depend on the details of the situation, but in general, I recommend against purchasing items at retail stores and lean towards buying from authorized resellers, or failing that, from an established, long-time distributor know for selling that brand. You may not have the kinds of supplier info or even the proper invoice documents to prove authenticity, otherwise. Not based on the parameters of what they normally ask to see…

    Otherwise, given the Product Quality team landscape these days, you’re going to need to appeal to Amazon indicating you’ll never list or sell these again, and delete listings/ remove items from FBA.

    Thanks for reading. — Chris

  7. It’s not surprising that this is happening, however, the much bigger issue is the actual copyright infringement that IS taking place. Amazon has a duty to enforce the Digital Millennium Copyright Act and it makes sense that they would err on the side of caution to prevent lawsuits being brought against them. Hoards of sellers operating out of Indonesia, China and various other countries (outside the US) with loose copyright enforcement are using images taken directly from eBay (and other websites) without permission in order to re-sell the products on Amazon. They are essentially acting as a broker and profiting with huge mark-ups. While there is nothing illegal about drop-shipping, it is ethically a questionable practice as the buyer is unaware they are purchasing from a third party and paying three times (or more) what the product is actually valued at. Amazon does act on complaints, however, the process is slow (1-4 weeks) and aside from removal of the intellectual property, I have not witnessed any immediate action taken against the sellers accounts as they continue to operate Amazon stores.

    1. Agreed on most of the above, the reason it takes Amazon a long time or they sometimes fail to act is the sheer number of these infringement claims, plus as I noted, the knowledge that the Amazon internal teams aren’t doing much to vet these forms breeds more abuse. Also, they don’t have enough headcount on these teams to handle all the volume.

      What did you mean in terms of the dropshipping? Not sure I followed you there.

      Chris

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