How suspended Amazon sellers can handle intellectual property complaints & get their sellers accounts reinstated after a rights owner complaint suspension
When selling on Amazon, an Amazon seller should be aware of the Intellectual Property (IP) issues that regularly arise on the platform.
For Amazon sellers, intellectual property involves copyright claims, allegations of trademark infringement, trade dress accusations, and claims of patent violations.
“Intellectual property rights are extremely important for suspended Amazon sellers to understand. There are many places where sellers can run afoul of intellectual property infringement laws. Equally, there are individuals who take advantage of Amazon sellers’ ignorance of their intellectual property rights.” ~ Kerry McDonald, Senior Managing Paralegal at Rosenbaum Famularo, P.C.
Copyright law for suspended Amazon sellers generally is focused on the use of someone else’s verbiage or images. The 3 types of copyright infringement are direct, contributory, and vicarious.
~ Direct copyright infringement requires the “plaintiff” to show that he or she owns the copyright and that the defendant personally violated one of the plaintiff’s rights enumerated in the Copyright Act. A 3rd party who does not directly infringe could be held liable for secondary infringement.”
~ Contributory copyright infringement means “an actor had knowledge of the activity and induces, causes, or materially contributes to the infringing conduct of another.”
~ Vicarious liability for copyright infringement takes place when the accused “enjoys a direct financial benefit from another’s [directly] infringing activity and has the right and ability to supervise the infringing activity,” but declines to stop or limit it. “It is predominantly secondary infringement that concerns Amazon sellers because they are often accused of hosting the product listings that are allegedly infringing a copyright.”
A trademark is “any word, name, symbol, or design, or any combination thereof, used in commerce to identify and distinguish the goods of one manufacturer or seller from those of another and to indicate the source of the goods.”
Examples of trademarks are the Olympic Rings, the ‘Just Do It’ logo and Swoosh from Nike, and the Apple logo.
A consumer expects a certain level of quality from a product with a specific logo; it is their identifying factor. Pictures of items that occur and exist in nature, such as the drawing of an orange on a package of supplements and generic words cannot be trademarked.
Trademarks are governed by the Lanham Act. This act outlines the procedures for federally registering trademarks and states when owners of said trademarks may be entitled to federal judicial protection against trade infringement, as well a sets other guidelines and remedies for trademark owners. The Lanham Act is a federal statute which “governs trademarks, service marks, and unfair competition.”
Intellectual property issues arise on Amazon primarily when a brand makes a baseless complaint against an Amazon seller that is selling genuine products.
The vast majority of Amazon sellers do not sell counterfeit products. Those who do are usually unaware that their merchandise is actually counterfeit. For the most part, Amazon sellers try to sell genuine products so as to avoid having their accounts suspended.
“The most basic mistake that sellers can make occurs when creating their initial listings or even a single detail page. When an Amazon seller creates a listing, all of the images and descriptions should be of their own creation and not from any other source. This is one of the most common forms of intellectual property infringement that we see.” ~ CJ Rosenbaum, Founding Partner, Rosenbaum Famularo, P.C.
By definition, trade dress is “the overall appearance and image of a product or a commercial enterprise in the marketplace. For a product, trade dress typically covers packaging and labeling. For an enterprise, it typically involves design and decor. If a trade dress is distinctive and nonfunctional, it may be protected under trademark law.”
“The ‘trade dress’ of a product is essentially its total image and overall appearance. It ‘involves the total image of a product and may include features such as size, shape, color or color combinations, texture, graphics, or even particular sales techniques.’”
Amazon does not allow trade dress infringement on their platform. The Amazon webpage reads, “TRADEMARKS: In addition, graphics, logos, page headers, button icons, scripts, and service names included in or made available through any Amazon Service are trademarks or trade dress of Amazon in the U.S. and other countries. Amazon’s trademarks and trade dress may not be used in connection with any product or service that does not belong to Amazon, in any manner that is likely to cause confusion among customers, or in any manner that disparages or discredits Amazon. All other trademarks not owned by Amazon that appear in any Amazon Service are the property of their respective owners, who may or may not be affiliated with, connected to, or sponsored by Amazon.”
On their customer-service page, Amazon provides sellers with a comprehensive list of all their trademarks. Any form of intellectual property infringement against Amazon is a bad idea for sellers.
So that all other parties may be aware of the protections, trademarks and trade dress rights are published. When creating a label or logo, it is the responsibility of each and every Amazon seller to first check to see if the design they would like to use is already protected. The next step is for that Amazon seller to protect their logo or label so that no one else can use it. Many sellers find it difficult to navigate the USPTO, and as a result, they hire an attorney specializing in intellectual property to first check for existing marks and then to file for protections.
It is important for an Amazon seller to protect their brand because the Amazon website has a global audience. Companies do not want their competitors stealing their designs. Additionally, if an Amazon seller does not receive protections, someone can steal their design, and then file for protections of the design. Unlike patent protections (where you receive protection for 20 years) or copyright protections (where you receive protection for 70 years after the death of the author), trade dress protections do not have time limits, and trademark protections typically last as long as the mark is used in commerce.
Trade dress often comes into play on Amazon when sellers create their own private label products and copy a brand’s color schemes, packaging, shapes, etc.
When an Amazon seller is developing their private label, they should avoid mimicking the overall look or “dress” of another company’s products too closely. If a seller copies the same language, colors, or uses similar pictures of a label, but a different brand name, they still might be infringing upon another brand’s trade dress. It is a common mistake that sellers make because they believe that since the name is different, their product is OK.
“The phrase ‘inspired by’ does not protect you from intellectual property infringement.” ~ Jason Powell, Paralegal at Rosenbaum Famularo, P.C.
Unfortunately, baseless trade dress accusations have resulted in the suspension of many Amazon sellers. Competing sellers have accused others of trade dress violations due to similarities that are not strong enough to constitute trade dress infringement.
For example, selling the same product, both of which have “orange” bottles, is not a violation of trade dress. We have seen vitamin companies, hair companies, and companies who sell Moroccan oils file complaints against their competition, despite the competition not actually infringing on any trade dress.
Some businesses seem to believe that if they receive trade dress protections they have a monopoly over every individual portion of their protection. This is simply not true; they only have protection of the overall appearance. We have seen companies attempt to knock sellers off the Amazon platform for using the same fruit or color as their protected trade dress. That is not enough to constitute infringement. It has to be the overall appearance, not one similarity.
To receive protection, both of the following must be true:
- The trade dress must be inherently distinctive, unless it has acquired secondary meaning.
- The junior use must cause a likelihood of consumer confusion.
Trade dress has been viewed by the courts in the traditional view and the modern view.
The traditional view is “only referred to the manner in which a product was ‘dressed up’ to go to market with a label, package display card and similar package elements.”
The modern view has expanded from the traditional view. In John H. Harland Co. v. Clarke Checks, the court took a modern approach stating that trade dress should be defined as, “‘total image’ or ‘overall appearance’ and ‘may include features such as size, shape, color or color combinations, texture, graphics or even certain sales techniques.’”
If an Amazon seller has been accused of trade dress infringement, it is important to speak to an attorney. Legal issues should not be addressed by nonlegal “consultants.”
Only an attorney can assess:
- If the accusation against you has any merit
- Draft a legal opinion letter pointing out the complaint is baseless
- Point out the legal liabilities should the brand refuse to withdraw its complaint
- Stand up to another lawyer with any strength
Amazon sellers should always keep in mind that while Amazon doesn’t require the complainant to prove much, ultimately it is the complaining party’s burden to prove all elements of any alleged infringement. They must first demonstrate that they have an item that is inherently distinctive and then they must show that the infringing Amazon seller’s item causes a likelihood of consumer confusion. There is no infringement if they cannot prove these legal elements. If an Amazon seller is accused of infringement, it is extremely important to have a legal professional handle their legal issues to assess if what transpired on the Amazon website was actually intellectual property infringement.
Trade Secrets are “a formula, process, device, or other business information that is kept confidential to maintain an advantage over competitors; information—including a formula, pattern, compilation, program, device, method, technique, or process that:
(1) derives independent economic value, actual or potential, from not being generally known or readily ascertainable by others who can obtain economic value from its disclosure or use, and (2) is the subject of reasonable efforts, under the circumstances, to maintain its secrecy.”
Patents protect ideas such as inventions or technological processes.
Amazon.com has been involved in lawsuits relating to patent infringement based on their own behavior, not just their sellers’ behavior. Amazon has also been listed as a defendant in cases “when a third-party Amazon seller is selling a patented product without the proper license.”
In patent-infringement cases, Amazon has used the defense that the alleged patent is patent ineligible; this means that the patent should never have been issued by the US government. Patent infringement cases are serious and have the potential to cause greater harm to the livelihood of an Amazon seller than just a suspension. To ensure a resolution, it is in an Amazon seller’s best interest to hire an attorney to handle these issues. When a party wins a patent infringement claim, they can recover 100% of the profits made by the sale of a product that infringed on the patent holder’s rights.
Operating on Amazon
If an Amazon seller is a brand owner or using a private label, it is likely that they have their own logo. Private labeling is designing a manufactured product for sale under the name of the retailer rather than that of the manufacturer. This process is not specific to Amazon, and is becoming a common practice for sellers to secure their practice.
When a seller places his or her logo on packaging, they are creating a design specific to their brand. Once a business owner has turned to private labeling, the next step for many is to trademark their brand.
It is equally, if not more important, to first make sure you do not infringe on any other seller’s trademark. If you are caught selling a trademarked item without permission, it could cost you not just your Amazon account but also could result in a lawsuit filed against you.
“Often, a manufacturer will sue both the Amazon seller and Amazon.com for trademark infringement; usually in cases where a seller is accused of selling items that are inauthentic, counterfeit, or are sold by an unauthorized reseller.”
However, Amazon is typically not found to be liable for infringement. The Amazon seller may not be as lucky.
If an IP complaint is made against an Amazon seller account:
Intellectual property allegations are an entirely different type of complaint. An Amazon seller will face far more than suspensions if the complaint is legitimate; they face a potential lawsuit. For this reason, it is extremely important for a suspended Amazon seller to receive advice from an attorney.
Any allegation of intellectual property infringement will likely result in the suspension of a seller’s listing or their entire account. This is Amazon’s way of avoiding liability for the infringement. This is Amazon’s way of avoiding being sued; they will kick sellers off the platform at the first sight of an allegation, then leave the seller to prove they did not infringe on any rights.
When a listing or account is suspended, they will receive an e-mail from Amazon stating that it is requiring the seller to work out the issue with the person or company that filed the complaint. The suspended Amazon seller must contact the company who made the allegation. Many companies have taken the necessary precautions and have properly registered their IP. These companies will have systems in place to monitor for infringement, and sometimes people who are legally selling authentic products get caught in the net. In many cases, the IP rights are valid, but the allegations are totally baseless.
Many complaints arise where an Amazon seller is selling a product that may appear similar to others, but those specific similarities are not sufficient enough to constitute infringement. An Amazon seller will likely need an attorney to demonstrate to the company that their product is unique, original, and not infringing on anyone’s IP rights. If the rights owner does not willingly retract its complaint, it is unlikely that Amazon will reinstate the suspended seller’s selling privileges for that item.
There are many times where complaints are baseless. Companies and manufacturers will also file IP complaints on an Amazon seller’s account if they are selling the same product, but at a lower price. These types of complaints are an abuse of the Amazon platform’s implemented policy because they are frivolous and have no merit.
Many companies mistakenly allege infringement on seller accounts. If this happens, the suspended seller will need to notify the complaining party that it is their burden to prove there was actual infringement. For patent infringement, there is an “All Elements Rule” that requires each claim limitation to be proven by the plaintiff who is alleging the infringement. If the company alleging the infringement cannot prove that the seller has met all the requirements to prove infringement, then there is no infringement. Once it has been established that there was no basis for an infringement claim, the complaining party will usually agree to remove the comment.
The suspended Amazon seller will need to have the complaining party state to Amazon, in writing, that the issue is resolved and they are willing to withdraw their complaint. A copy of this document, along with invoices, should be attached to the suspended seller’s Plan of Action, proving that their item has not infringed on anyone’s IP rights.
When an intellectual property complaint is withdrawn:
When a suspended Amazon seller is able to obtain the withdrawal of an IP complaint, the suspension is usually ended. Occasionally, a suspended seller may need to take one or several steps to get back to selling on Amazon:
- Ensure that Amazon recognizes withdrawal of the complaint and links it to the suspended Amazon account. In order for the withdrawal to be linked to the suspended Amazon seller’s account, the withdrawal must come from the same e-mail from which the original complaint was asserted. Also, the suspended seller may want to provide the person withdrawing the complaint with the following language to use in his or her e-mail to Amazon:
“Dear Amazon, we (name of brand that made the complaint) hereby withdraw the intellectual property right complaint previously asserted against __________ (the name of the suspended account or storefront), Seller ID _____________ (suspended Seller ID).”
- Make sure that the suspended Amazon seller is CC’d on the withdrawal e-mail.
- Draft a very concise POA explaining the issues in a positive manner.
- Prepare to e-mail [email protected] to show that the complaint was withdrawn and that the suspended Amazon account should be reinstated (include the withdrawal e-mail, and if the suspended seller is not successful, submit a second submission including the letter from the attorney explaining why there was never an IP infringement).
Intellectual Property POA
Once the complaining party has removed their complaint against the suspended Amazon seller, they will be able to move forward with their Plan of Action. If the complaint is not removed within the given time frame required to write their POA, the suspended seller must include in their letter that you have reached out to the seller.
STEP ONE:
Dear Product Compliance Team,
I am a principal of (Suspended Amazon Seller’s Store), and we are writing this to appeal our suspension due to Intellectual Property–related complaints.
The Cause of This Issue:
- We sell only 100% authentic quality items through our Amazon account; however, a rights owner mistakenly filed a complaint on our account, believing our product was a knock off.
- We have reached out to the seller, and they have since acknowledged their mistake and removed their complaint.
Once the suspended seller has shown why this happened, they will then need to show all the steps that they have taken to correct the issue. This includes a letter from the seller acknowledging the error, proof that the complaint has been removed, and most importantly, proof that the item is being sold legally.
The suspended Amazon seller will have to show Amazon that they have and will continue to follow Amazon’s policies. The suspended Amazon seller must demonstrate that they have someone reviewing their inventory to show that all items are legitimate and not violating any other rights.
STEP TWO:
We understand the responsibility for policy compliance lies with us. As such, we have taken the following actions to correct this issue and ensure it never reoccurs:
Corrective Actions:
- Contacted the complaining party immediately to resolve the issue. Please see attached correspondence demonstrating that the complaining party mistakenly alleged an IP violation.
- Contacted our supplier / manufacturer to ensure all our items are 100% authentic and not in violation of an IP rights. Please see attached invoices and letter from the manufacturer.
STEP THREE:
Preventative Measures:
- We dedicated a team member to specialize in policy and compliance specifically for the Amazon platform.
- All inventory is reviewed upon arrival to ensure they match their listings 100%.
- We only conduct businesses with manufacturers who can supply documentation to demonstrate that all items are 100% authentic and not in violation of any other person’s intellectual property rights.
The suspended Amazon seller’s conclusion should acknowledge that they respect Amazon’s customers and their trust. The suspended seller should state that they have made key inputs into their business practice to ensure that they also follow Amazon’s “customer obsession” motto.
When the complainant refuses to withdraw his / her complaint:
When the complainant refuses to withdraw his or her complaint, a suspended Amazon seller should immediately hire an attorney if they have not already done so.
If a brand or “rights owner” refuses to withdraw a baseless complaint, an attorney should do two things:
- Draft a POA for the seller to submit to [email protected] that states that the complaint is baseless and should be ignored.
- Attach a copy of their Legal Opinion Letter—the same ones sent to the brand, as support for the suspended Amazon seller’s POA.
This is the best way for the suspended seller to show the Amazon staff that the complaint is baseless and then back the position up with the opinion of a lawyer.