It sounds like there are a million deceived customers and cheated small businesses, but no individual customer or small business can take on Amazon. How about a kickstarter or other crowdfunding plan to raise money from everyone who's suffered due to Amazon's apparent tolerance of counterfeits? I.e., if you received a counterfeit product, or if your product or book was counterfeited and sold on Amazon (like the Antimicrobial Therapy handbook)?
The kickstarter plan would be to either sue Amazon as class, or sue based on the best individual cases in all available jurisdictions, or failing all of that, to lobby the government to bring Amazon under control. Assuming it got enough funding, is there any chance that the lawsuits or lobbying would work?
It is clear that Amazon and its management knows that they have a counterfeit problem. How about we all band together and file a class action lawsuit? I am sure there are many millions of people, consumers and businesses, affected by Amazon's active negligence of policing the authenticity of items in their marketplace. I would even say there are probably tons of smoking gun emails between Bezos and staff regarding these issues.
Sometimes the only way to get companies like Amazon to play fair is with the threat of a billion dollar settlement hanging over them. The free market doesn't always work.
This can be solved by requiring higher-risk merchants to put money in escrow for a while (maybe an initial amount plus some fraction of revenue). If they turn out to be selling counterfeits, amazon could use the money to set things right. Otherwise the merchant gets the money.
If Amazon had direct liability for selling counterfeit products, for example, if the Ove Glove company (first in the original article) could sue Amazon and recover all the revenue that went to the counterfeiters plus a penalty - I believe in this case Amazon would find a solution to ensure supplier verification.
The problem is that currently it's profitable for Amazon to host goods from fraudsters; if (when) any get discovered, they kick them off but keep the proceeds. Society and law should ensure that Amazon loses money when hosting goods from fraudsters, so that the motivation is properly aligned.
I think you solve it by making amazon directly liable for fraud on their platform. They’d clean up the problem pretty quickly after losing a few billion dollars in lawsuits.
This is the same bullshit companies like Airbnb and Uber try to pull.
No, the people sit in the Amazon offices. If you sell stolen goods you're lucky if you aren't charged with fencing but you can bet you won't be reimbursed if those goods get claimed. If you sell fake products, you should be held accountable just the same.
Sure, pass the buck up the chain but this should never allow the consumer to be knowingly harmed by an intermediary knowingly enabling the sale of counterfeit items with no accountability.´
Amazon is knowingly allowing fraud to happen. It's a risk they're willing to take and they can get away with it because there's no legal accountability. They could try to curb it but that would impact the bottom line. The only way to fix this is regulation (i.e. laws) and more consistent application of it.
The market can't fix it because there's no market incentive to fix it.
The problem here is Amazon making it ridiculously easy for people outside of our legislatures reach to commit crimes. So, the logical option is to punish Amazon (and similar companies) for distribution of counterfeits.
Is it legal what Amazon is doing (or rather, not doing)? Well, make it illegal.
At what point is Amazon complicit in the sale of counterfeit goods from a legal standpoint? It is an obvious problem and Amazon doesn't appear to be doing much to counter it.
Seems like only a matter of time until they get sued by a brand name manufacturer just as YouTube got sued by content producers almost a decade ago. Not that I look forward to the day when Amazon sellers can be taken offline by a copyright notice like YouTube users today, but that is where we are heading.
If Amazon chooses to let counterfeiters etc sell on their website, why should they not be held accountable for that? Maybe they will finally show interest in what the heck they are showcasing on their own platform.
So... I'm sure it's not as easy as I think it should be, but isn't this just a DMCA takedown notice away from getting fixed? As much as the DMCA is generally horrible and abused, this seems like an actually good use for it.
Of course, the counterfeit seller can just create a new account, and then it becomes a game of whack-a-mole, but perhaps that could be grounds for a lawsuit against Amazon directly, for failing to rein in all the copyright infringement occurring on their platform. (Maybe even a class action, since this problem seems widespread.)
Again, I'm sure this isn't easy or fun (or cheap) to do, but tweeting at people to not buy your book from Amazon seems to be... not all that useful a response?
Considering the amount of counterfeit goods sold on Amazon I suspect at least some of it was simply stolen. In such a case I would expect the items to be clawed back if possible. Though with the possibility of Amazon making the buyer whole.
That also seems like the correct approach here where anyone running a feeder fund should be on the hook.
I would think a little bit of piracy is okay with Amazon as vetting the authenticity of every seller would be too expensive and time consuming, and making it harder for a seller to get onto Amazon will only encourage the growth of competing platforms. I wonder if Amazon has a policy by which it makes payments to sellers cheated by counterfeit goods so long provided they sign an NDA about it?
I don't get why they don't fix it. It's a huge problem and it's eroding confidence in Amazon.
It's not even hard: just require anyone selling on Amazon to wire a large enough deposit before they are allowed to sell (magnitude depending on the price, volume of their items and possibly their assumed trustworthiness); then, if they are found selling counterfeits or otherwise misrepresenting their products or their company, Amazon pockets a third of it, rewards another third to the person reporting it to Amazon and distributes the remaining third to affected shoppers.
It seems to me that the gains would far outweigh any possible reduction in the number of legitimate sellers and products.
I think they should be liable, but I think even just enforcing the existing laws without making them liable would put a stop to it.
Just have the police start tracking down what warehouses counterfeit items came from, and getting search warrants to search them.
Apart from the fact that this would directly reduce the number of counterfeit's... repeatedly shutting down warehouses for searches would kill Amazon's bottom line. Cleaning up after the police would kill Amazon's bottom line. Etc.
It's not exactly justice, but it is damn effective. You can beat the rap but you can't beat the ride and all that.
>I've been wanting to take them to court over it; but most lawyers have quoted me at the process costing ~$8-9k; which, I'm terrified to be on the hook for if I lose.
You could try to crowdfund a lawsuit (promise to donate the crowdfunding to a charity if you win and get costs). I suspect more than a few Sellers would like to get back at Amazon.
Eventually something terrible is going to happen, some kind of mass-casualty incident that can be directly traced to a counterfeit or illicit product sold on Amazon. At that point, Congress will fall upon them like a band of starving wolves and make them fix their broken system.
If Congress doesn't act, plaintiffs' attorneys will. It'll be the McDonald's coffee case all over again. They're not just asking for it, they're begging.
Until that happens, they simply DGAF. As you say, they're #1, and in Amazon-world, that means you stop trying.
Unfortunately, I only see a way to solve this for fungible goods where you would still need to get every actor involved in the supply chain to upgrade to the same secure tracking solution. It could be done in theory with crypto and tamper-proof packaging, but overcoming the network effect of today's archaic supply chains would be a huge undertaking.
The article points out how sellers are creating unique, non-fungible goods. So how does a customer even initially know that they're discovering 'the original' and not something that has been re-branded? With a Lamborghini, re-naming the car to another brand isn't a problem since the customer won't find it (and a supply chain integrity solution might work.) But how would you solve the Amazon problem?
I suppose you could have a time-locked escrow account where sale funds had to be locked there for N days. That way there would be time to challenge counterfeit sales and re-distribute the funds to the original authors (and / or make customers whole) when fraud was detected. But I am pretty sure people would hate that. Everyone would have to agree to use it for it to work and it wouldn't stop the potential for brand damage from low-quality counterfeits.
If it were a short enough time-lock though, it might work? High enough that it removes the incentive for fraud, low enough that it doesn't frustrate vendors.
There is already legislation that should give the FTC teeth to fine or shutdown Amazon based on counterfeit goods, especially if the branding is illegitimate.
An important and related fact, addressed in the article, is that Amazon currently escapes consumer product liability laws because they are neither seller nor manufacturer. But they also cannot tell you with any degree of precision who the seller or manufacturer is.
There is a public interest in making /someone/ liable for defective products, as it provides a incentive for sellers to do due diligence on what they sell.
The party most able to root out sellers of defective or counterfeit goods is probably Amazon, but they currently have no incentive to do so as the liability is offloaded to judgement-proof Marketplace sellers.
Amazon's business innovation here is figuring out how to run a multi billion dollar retail business without product liability, and that's negative for society.
The kickstarter plan would be to either sue Amazon as class, or sue based on the best individual cases in all available jurisdictions, or failing all of that, to lobby the government to bring Amazon under control. Assuming it got enough funding, is there any chance that the lawsuits or lobbying would work?
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