Amazon Sellers, the Verdict is In: When Do You Really Need a Lawyer?

To lawyer up or not to lawyer up, THAT is the question. Account suspension? IP dispute? Multiple accounts? When do you need a lawyer as an Amazon seller?

I’ve had numerous sellers tell me in the past that they had hired a lawyer to help them deal with Amazon, on a wide range of issues.  Unfortunately, when I ask them to describe specifically how a lawyer will help them in this or that case, I hear vague commentary about how Amazon takes sellers more seriously when attorneys are involved.

Some may think that Amazon Legal will magically get involved in infringement claims submitted to Notice teams.  In other cases, they fundamentally misunderstand how lawyers function within a marketplace where sellers have agreed to the TOS. It prohibits taking legal action against Amazon outside of an arbitration case.

Amazon will not referee legal disputes between two sellers of two brands unless they’re legally mandated to do so, which is extremely rare and must meet several specific requirements.  

If Amazon’s records are under subpoena and must be revealed during litigation, for example, Amazon may (to an extent) be drawn into a lawsuit between two brands or sellers. Otherwise, Amazon forces sellers who have disputes with each other to address them against each other.

Sellers need to avoid thinking that hiring a lawyer for “anything Amazon” will mean you’ll be taken more seriously.

We’ve seen numerous cases where hiring a lawyer really hurt the seller’s chances of reinstatement, especially when it comes to account suspensions.  Many of those sellers had submitted generic templates with “fill in the blank” appeals, and then the attorney had no idea how to escalate the stuck cases.  The seller stays closed. 

Overall, an Amazon seller’s need to retain a lawyer normally falls into distinct types of situations.  I’ve noted the most common and important use cases below, along with some contributions from lawyers Casey Hewitt and Lance Johnson, two of the recommended lawyers we refer sellers to.  

When You DO Need a Lawyer

1. Setting up IP/Trademark, Copyright Images, Patent Protection

How important is it for new Amazon sellers and brands to work out their legal strategy in advance?

We’ve seen countless examples of sellers who rush into selling, but fail to understand that skipping over trademark registration means you cannot sign up for Brand Registry.  That means you lose a solid means of protecting yourself (or trying to make Amazon help you protect your brand) and are left to submit  IP infringement claims with Notice teams.  Leaving your brand in the hands of teams that often fail to take appropriate action on brand abusers is not recommended.  You need any and every tool at your disposal to fight those off.

According to Casey,  “It’s very important for sellers to consult with a knowledgeable intellectual property attorney at the beginning of their selling journey.  Part of the process when developing a new product or launching a new brand or store should always be evaluating what intellectual property protections you need to have.  Do you have a trademark? Original product packaging? Copyrighted package design? Are you sure that your brand and your products and your designs do not infringe on the rights of other parties?”

So, while we understand that many sellers join classes or “learn to sell” groups that emphasize getting started quickly over beginning prudently, calculating the cost of reliable IP protection and maintenance should be as much of your thinking as an ad or marketing spend.  Leaving gaps or loopholes in your processes around rights owner protection can encourage bad actors to attack you right away, before you get your bearings.  

“Sellers often put this off, thinking it is an unnecessary expense. But finding out after the launch of your product that your product or brand name infringes on a famous brand’s trademark can sound the death knell for a new business,” says Casey. 

Obtain professional and trustworthy legal advice when you get started with a new Amazon business.  If nothing else, understand the variety of ways you could expect to be attacked with bogus claims, then strategize accordingly.  

2. Resolving Intellectual Property disputes 

Often sellers don’t know what to do when they receive a new notification from Amazon regarding a rights owner claim.  Amazon gives you a Complaint ID, an email address for the rights owner, and ASINs cited along with the complaint itself, be it copyright, patent, trademark or counterfeit.  Your listings are removed and you receive a warning for having violated the Intellectual Property of the rights owner, per their stated claims in the Notice form.  

These days, whether you’re private labeling or reselling another brand, you could get hit with any of the four main IP complaint types:

  • Patent or design infringement
  • Copyright infringement
  • Trademark violations
  • Counterfeit complaints

So, all sellers need to know their options when handling notice claims so as to prevent missteps and long-term damage. 

It’s up to you to contact the rights owner to get IP claims retracted. If it’s a bogus claim, often the address won’t even work and your email bounces back.  But for a valid claim, ignoring it simply leaves the matter unresolved, as far as Amazon is concerned.  They will consider it a mark against your account, even if you immediately delete the listing and remove your inventory from FBA. 

I encourage each seller who receives one of these to start by reaching out to the email address given by Amazon (even if it appears bogus) to ask what the nature of the IP claim offense is, and how it can be resolved.  The information received in the response would be a useful yardstick for the strategy to come, no matter the validity of the claim. 

If there’s no reply, it could mean a couple of things. 

A) The rights owner or their legal representative is busy and will take time to get back to you.

B) They’re under no obligation to reply and they want you to drop off whatever listing they cited on their Notice claim form.  Then it’s time to call in some reinforcements.  A letter from your IP attorney on their firm’s letterhead would be more likely to grab attention, and perhaps to make the other party motivated enough to respond.  When they do, their response should state their terms to resolve the matter with you. If they refuse to reply to the attorney’s letter or refuse to make peace with you, then you know you’ll have to delete the listing and remove the inventory.  But that’s a weaker approach and doesn’t truly resolve the core problem.  

A Note on FALSE Counterfeit Claims

False accusations of counterfeit abound on Amazon, and this is nowhere more evident than in the Notice IP claim of infringement process. According to attorney Lance Johnson, rights owners should be wary of filing false claims.

“I think the recent decision in TP-Link v. Careful Shopper, No. 8:19-cv-00082 (C.D. Cal. March 23, 2020 was wrongly decided. In that decision, the court acknowledged that TP-Link had made false representations to Amazon that Careful Shopper was selling counterfeit TP-Link products. Despite this, the court granted the TP-Link motion to dismiss the counterclaims for defamation on the ground that the false representations were “protected speech” under California’s anti-SLAPP law. A motion for reconsideration is pending.”  

Submission of fake claims against a seller is serious business, especially when there’s no proof or evidence that would hold up in a court of law.  While this decision demonstrates you can’t easily sue a brand for defamatory comments against you for selling counterfeit (when you didn’t), you’ll need overall legal strategy and guidance to sort out the best ways to handle IP-based, brand level attacks no matter what kind of Amazon account you have.  

3. Receiving Cease and Desist Letters: What to do with them? 

Sending Cease and Desist letters to anyone who joins your listing (which isn’t what detail page “hijacking” is, by the way, although this term gets misused this way a lot) turned into a fad a couple of years ago.

Regardless of whether sellers started doing this on their own, with a lawyer’s help, or even by hiring general “brand protection” agencies, their intention was to scare someone off their listing without involving legal Notice claims.  It functions as a work around for product gating, since that process is currently locked up tightly and most brands cannot achieve brand gating at all.  Unfortunately, this can have repercussions.

Cease and desists shouldn’t be written to include false accusations like “We know you’re selling counterfeits of our products! Get off my listing!” Actual proof is sorely lacking in these letters. 

While it’s often presented as a “hack” to get around Amazon Notice infringement team procedures, you can’t make legal threats on the other seller’s failure to negotiate exclusive deals with you to sell your product on Amazon.  You would need to demonstrate first how and why the items they’re selling are fake versions of the branded product offered, typically using a required test buy.   

Using unscrutinized scare tactics simply to drive a certain percentage of sellers away from your detail page is the wrong way to go. 

Accusing someone of counterfeit sales and threatening to report them to Amazon without supporting documentation or evidence means taking legal risks that could backfire and create new liability for you.  You may even get their entire account suspended based on an unsubstantiated allegation.  

Get legal advice before sending accusations of a legal nature, or before reporting counterfeit products that fail to meet Amazon’s stated requirements.  

4. Coping with Amazon Errors in IP Investigations or Declarations of Truth in Appeals

Some other use cases for hiring an attorney? Using a sworn affidavit to fight off the accusation that you’re related to a previously blocked seller account, for example.  To quote Casey Hewitt of Vaughn Law Group regarding this strategy: 

“An affidavit or legal analysis from a lawyer is most helpful when Amazon is making an objective mistake of fact or law.  Your lawyer can come in and explain the situation from a legal perspective and put forth evidence to explain to the decision-makers at Amazon why their initial read on the situation was incorrect.  This comes up often when sellers dissolve a partnership or a marriage and they have a decree that outlines which partner is entitled to which assets after the dissolution.  Amazon may still link two parties as “connected” but when you present them with the dissolution decree and advocate for separation, they will often “unlink” the sellers internally at Amazon and no longer attempt to hold one seller responsible for the other seller’s account.  This can also come up when sellers own or have ownership stakes in different brands that are formed as legally separate entities (with separate boards, separate addresses, separate tax returns).” 

Amazon may not fully understand what entities are different from each other, and “an effective attorney can explain under the relevant state law how the parties are separate and Amazon will often accept the explanation.  This is important to think about as a seller’s brand grows and the seller starts thinking more about eventual sale or spin-off than day-to-day management.”  

Amazon’s tools and their investigation teams don’t always clarify to sellers what they mean by “Related” accounts, and of course, they say they cannot disclose how they determined accounts to be related due to proprietary methods.  

One other note on hiring an attorney. According to the American Bar Association, clients must keep Rule 7.1 in mind when retaining a lawyer. Lawyers cannot make guarantees that misrepresent fact or law, or omit facts that create misleading representations. Many sellers have complained to us regarding their past hiring of an attorney and the failed work that resulted, given the absence of a guarantee. Unfortunately, guarantees can’t be expected where they’re not allowed and generally speaking, Amazon makes the rules here.

When do Amazon Sellers NOT Need to Hire an Attorney for Help? 

Amazon sellers don’t need a lawyer for most kinds of account suspensions, especially non-legal ones. 

There are even some straightforward “legal suspensions” that will not require legal advice beyond contacting a rights owner you’ve offended to find out what their terms are to remedy the situation.  Deciding to accept or reject those terms in order to improve your odds of appeasing Amazon is something you can do yourself using your own calculation of how important your account is. 

In some cases, simply agreeing not to sell another brand’s items on Amazon again will boost your odds of account reinstatement with a viable Plan of Action. In others, you can identify the nature of a valid rights owner infringement and take unilateral steps to resolve it.  

Countless sellers speak with us after having contacted rights owners to obtain retractions, and got them, so they only needed help with a solid POA.  You definitely don’t need a lawyer for Plan of Action help. Otherwise, there wouldn’t be seller consultants who aren’t lawyers helping sellers every day, as we know to be the case.  When I worked in Seller Performance, none of the sellers I reinstated had their appeals written on law firm letterhead.  An acceptable Plan of Action is your goal, not legal representation for a planned action against Amazon itself.  

Below are my top 5 examples of suspensions that don’t involve nor require a legal assessment.

1. Product Reviews Abuse

Unless you plan to cite consumer protection laws that you’ve broken in misleading the public about the quality or quantity of positive reviews you received, I’d recommend appealing a product reviews abuse suspension as a policy violation

Acknowledge what you must regarding the nature of those violations that led to your account suspension, then lay our all proactive means of ensuring compliance going forward.  You don’t need a lawyer to convince Amazon of your interest in policy compliance, because Amazon didn’t suspend you for breaking the law.  

2. Suspensions for Violations of Amazon Policies (e.g. listing policies, detail page creation policies)  

Citing unrelated or irrelevant legal jargon is the last thing Seller Performance wants to see you do. Don’t appeal things like ASIN variation misuse or Product Detail Page tampering without demonstrating a very specific understanding of listing policies.  Show that you grasp how Amazon enforces listing compliance, and you appreciate why it’s important. You need to be able to explain details around EXACTLY what you did incorrectly, how you have fixed it, and how you can guarantee to them it will never happen again. If you have a good POA for this, you’ll be back up and running in no time.  There are no legal issues present on these at all. 

3. Disputing Inauthentic Claims

You don’t need an attorney and may not need ANY kind of consultant to dispute a fake counterfeit claim, usually submitted by competitors looking to trigger Amazon automation flags. 

In some cases, you simply submit verifiable supplier information that Amazon can confirm independently, then attach valid, acceptable invoices.  Unless you’ve edited or altered those documents in any way or you buy from a supplier who has no real online presence, you can credibly resolve almost all fake claims yourself. 

You may need to submit an escalation if Notice teams send you the same request for “greater details” over and over, but you will be able to reinstate the ASIN with a properly composed appeal to push your dispute up the ladder. No lawyer letters are required for this, unless you plan to accuse Amazon of defamation and take them to court. As we noted earlier, this is easier said than done. 

4. Payments Disputes… No One Has Successfully Challenged TOS on Payments Holds

Lately, numerous suspended sellers who wait 90 days after account closure fail to receive their final disbursements. Amazon will cite a breach of their “Seller code of conduct” or “Illicit, fraudulent activity” among other reasons, like a failure to prove legitimate supply chain. Unfortunately, outside of the arbitration process and a long period of waiting, you’re not going to recoup that money unless you know how to escalate within payments teams. 

Many sellers don’t know anything about Payments or how they process these cases at all. You may only get one shot at this, too.  After that one shot comes and goes, Amazon usually stops responding to you.

5. Creating Multiple Accounts 

Sellers need to follow Amazon’s policies prohibiting an unlimited number of related accounts, and understand which conditions allow you to operate more than one. 

In the past, you had to prove a legitimate business need for this and then asked Seller Performance for written permission. There’s no need to write in anymore but you must adhere to Amazon’s strict policy on this matter. Avoid interpreting it to suit your own needs. Either way, you don’t need a lawyer to interpret it or any legal knowledge aside from what would legally separate one business from another.  

To open an additional account, you must understand the different nuances of the policy and verify your interpretation by speaking with your account manager, policy team contacts, or with an Amazon policy expert who knows what counts, and what doesn’t. You must be able to defend the creation of added accounts by showing a legitimate business need for more than one account.

Make sure you grasp what constitutes a separate business by Amazon’s standards!

Imagine how many sellers have appealed without hiring an attorney and found themselves reinstated to sell again on Amazon. Whether they do it themselves or bring someone like me in to take care of, in most cases they didn’t need a lawyer for non-legal issues at all. If they ever encounter another account suspension again, they know they won’t need one then, too, unless there are core legal issues at play.  

Chris McCabe

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