How One Lawyer is Fighting Brand Hijackers on Amazon’s Marketplace

Amazon’s marketplace is suffering from counterfeit sellers and brand hijackers, and it is the job of Yael Cabilly, of Israel-based law firm Cabilly & Co., to advocate for legitimate sellers who have been burned by Amazon's hard-to-monitor marketplace.

For daily updates, subscribe to our newsletter by clicking here.

One of her clients was an Israeli fashion retailer with a $300,000 monthly turnover from his Amazon store, Ms. Cabilly recently told Calcalist in an interview. One day, he found his seller privileges revoked by the company. He learned that a Chinese seller was trying to take over his niche. The hijacker had bought 500 similar items off a seller on Alibaba and registered a trademark for them in the U.S. He then filed a complaint with Amazon, accusing the original seller of trademark infringement. Amazon immediately responded by suspending the accused seller’s account.  

Amazon's anti-counterfeiting policy states that it is each seller’s responsibility to source and sell only authentic products, and in case of violation, Amazon may—and often does—suspend or terminate the seller's privileges, even going as far as destroying inventory held in Amazon's centers. Those decisions are usually made by a sophisticated algorithm based on low feedback scores or customer complaints, without human intervention.

In the case of the Israeli seller, Ms. Cabilly submitted an appeal to the U.S. Patent and Trademark Office, filing documents that proved her customer had been selling the product long before the Chinese seller registered the trademark. After the patent office revoked the trademark, Amazon reinstated her client's account and banned the brand hijacker, but the process took three months, during which her client earned zero income.

As Amazon’s user base grew, an industry has cropped up, offering sellers ways to sabotage rivals with negative reviews or to artificially inflate their own product ratings.

"By now, I can recognize the manipulations of sellers on Amazon, and I know when it's a genuine complaint and when it's a competitor's ploy," Ms. Cabilly said. "Common complaints are that the product isn't authentic, that a trademark has been violated, or that the product carries a risk, for example a car gadget that exploded. But sometimes those are fraudulent complaints made by sellers looking to take out a rival."

Once a product has been removed or an account has been automatically terminated by Amazon based on its algorithm, sellers must convince the company that the termination had no basis or that the problem has been fixed in order to be reinstated.  

"These sellers require legal counsel in front of several entities—customers, competitors and Amazon itself, which acts as judge, jury and executioner," Ms. Cabilly explained.

Ms. Cabilly represents around 900 Amazon sellers, in both Israel and the U.S. Her youngest client is 14, her oldest 86.