After winning the lawsuit against Amazon, the funds of many sellers were unblocked!

In 2021, Amazon took drastic measures to rectify a large number of Chinese sellers, thousands of accounts were blocked, and hundreds of billions of funds were withheld. As of now, many sellers' funds are still frozen.

However, there is also good news. Many sellers successfully fought back and won the lawsuit against Amazon, and tens of millions of funds were unblocked.

Winning the lawsuit against Amazon, many sellers’ funds were unblocked

Faced with Amazon’s penalty of freezing funds, some sellers may choose to sit back and wait for death, but some sellers will choose to fight back, hire a team of lawyers, and go directly to court with Amazon, and ultimately win.

In 2021, after a big seller in Shenzhen failed to appeal, he hired a team of lawyers to apply for arbitration. In the end, the court ruled that Amazon’s second clause to freeze the seller’s funds was invalid. Amazon needed to unfreeze all the seller’s funds and compensate it with 12% interest. Perhaps the big seller’s victory gave Chinese sellers a shot in the arm, and since then, cases of sellers winning have been reported one after another in the circle.

Recently, a group of overseas lawyers announced three cases in which Amazon sellers won.

In this game with Amazon, judges in three states all believed that the second clause of the Amazon agreement that freezes sellers' funds is invalid, and Amazon needs to unblock the sellers' frozen funds and compensate the corresponding interest. This agreement allows Amazon to retain funds indefinitely if it suspects that a third-party seller is selling counterfeit products.

In the three successful cases, the judges had different views on the Amazon BSA terms. Some judges believed that sellers’ manipulation of reviews violated Amazon’s BSA policy, some judges believed that the penalty clause for Amazon’s second BSA review operation was unreasonable, and some judges believed that Amazon violated its obligation to distribute sellers’ profits according to the BSA terms.

However, they all agreed on whether sellers have the right to obtain sales funds: sellers have the right to obtain income from the platform. At the same time, the judge ruled that Amazon should compensate the three companies with US$499,900, US$342,700 and US$790,200 respectively, totaling more than 10 million RMB.

If the case is won, the seller’s funds will be unfrozen and the interest will be repaid, which may increase the confidence of other sellers to fight back against Amazon and will also encourage more sellers to try to use legal means to protect their own rights and interests.

But for some sellers, the huge time cost and high arbitration fees make them discouraged.

No progress in the lawsuit against the big seller, and the arbitration fee is sky-high

Half a year has passed since Zebao's subsidiary filed a lawsuit against Amazon, and the tens of millions of funds frozen by Amazon have not yet been unfrozen.

Youkeshu has set up a special working group to unfreeze the funds through arbitration and litigation, but the frozen funds of over 100 million yuan have not shown any signs of being unfrozen.

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At present, most of the sellers who have won the lawsuit or made progress in unfreezing their funds have gone through a year or even nearly two years. Obviously, it takes a huge amount of time for sellers to play against Amazon.

Moreover, the high arbitration fees have also deterred many sellers. According to feedback from some sellers, they all signed relevant clauses before entering Amazon, which stipulated that sellers had no right to collectively appeal and could only apply for arbitration.

If the seller wants arbitration, he needs to file a request with the corresponding country for each site of each account. The number of sites blocked by the seller is the number of arbitrations for the seller.

As the US site is where sellers gather, the arbitration fees are sky-high, ranging from 150,000 to 300,000 US dollars. For those big sellers who own dozens of sites, this is undoubtedly a sky-high price. This is also an important reason why many sellers give up arbitration and let their funds go to waste.

However, from a neutral perspective, the sellers who violate the rules and have their accounts blocked are not innocent. According to data from a foreign media interview, at least 50% of Chinese sellers are using some form of review strategy to violate Amazon's terms of service. It is a correct conclusion that the platform punishes sellers for violating platform policies.

But in the eyes of some sellers, Amazon's one-size-fits-all approach of freezing sellers' store funds is too inhumane, and it even punishes some behaviors that have not been concluded.

Amazon’s methods of rectifying its platform go far beyond this, and sellers need to be careful about more than just the issue of accounts being blocked due to positive reviews.

Amazon is still scanning accounts on a large scale, sellers need to be cautious

Recently, Amazon has launched another round of audit storms, and the number of sellers who have received Amazon verification emails has continued to soar. As the peak season is about to begin, many sellers who have been affected are eager to seek "secrets to pass the test", while sellers who have not been affected are still in a state of anxiety.

Only 2 of my friend's 5 accounts passed;

Several of my friend’s accounts were wiped out;

Eight accounts received email notifications, but many business licenses were cancelled;

"The Chinese sellers are being punished to death. All the accounts that have been operating for 5-8 years have been audited at once," said one seller. However, according to feedback, most sellers have passed the audit, and the ones with more problems are some individual sellers.

Bank card verification, identity information verification, it is not difficult to find that Amazon's many audit difficulties have been increasing since this year. This series of actions by the platform have made it more difficult for sellers to operate, but it has also cleaned up the platform environment to a certain extent.

Earlier this year, Amazon banned a large number of seller accounts for "manipulating reviews." These sellers were suspected of compensating consumers through gift cards and other forms of compensation in exchange for positive reviews of their products.

Unlike the previous practice of sending postcards together with the goods, many sellers have come up with a new trick, entrusting postcard companies to send out positive review cards separately a few days after the buyer receives the goods. It seems to be to obtain feedback from buyers, but in fact it is still to brush positive reviews. However, the beauty of this operation is that Amazon cannot find evidence that the seller is brushing positive reviews.

But over time, the truth was revealed. A large number of postcards piled up in some sellers’ mailboxes, and this incident became a hot topic in the market. Reports from consumers and peers, plus data from Amazon’s inspection of sellers’ backend orders, caught the sellers red-handed.

It can be seen that in the new year, Amazon has not reduced its crackdown on violations. Violations are very likely to result in account suspension, so sellers must not take chances. Amazon will take action against sellers' false reviews, fake orders and other violations, "although it will take time, it will come."

The peak season is coming, and I hope that all sellers can adhere to the path of compliance and actively prepare for Amazon Prime Day!

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