When Amazon Sellers Should Take Amazon to Arbitration.

When Amazon Sellers Should Take Amazon to Arbitration:

By: Robert Segall

Amazon Sellers

Amazon sellers are essential to the Amazon platform as the e-commerce giant continues to grow towards near monopoly status. Last year Amazon shipped over 2 billion items worldwide on behalf of sellers utilizing the Fulfillment by Amazon service alone. In addition, the company is now estimated to make up more than half of all holiday eCommerce transactions in the United States. As the platform continues to expand, issues for amazon sellers have become more frequent, and at times, more complex. Suspensions are a top concern for sellers, and getting back to selling is the number one priority in almost every case. When you have exhausted all your options, you may want to consider filing for arbitration; or, in the worlds of ASL founding attorney, CJ Rosenbaum, “take the decision out of Amazon’s hands.”


What types of Cases are “Ripe” for Arbitration?

Amazon’s Terms of Service:

Pursuant to Amazon’s terms of service, “each party consents that any dispute or claim relating in any way to this Participation Agreement or your use of the Services or Transaction Processing Services will be resolved by binding arbitration as described in this paragraph, rather than in court …”

This means that if the typical Plan of Action and appeal process did get you reinstated, arbitration may be your final option. Arbitration is similar to going to court, but it is usually less costly and gets faster results. The arbitrator, a neutral third party, may be a retired judge or practicing lawyer. The arbitrator’s decision is final just as if it were given by a judge in court. This means amazon must abide by the decision of the arbitrator according to the law.


Dead Ends in the Appeal Process:

When a seller is suspended, the appeal process begins with the seller writing to Seller Performance. The seller must draft a plan of action which details the reason(s) for their suspension and how they have corrected the issue(s) and implemented a plan to prevent them from reoccurring. Sometimes, a plan of action (or multiple plan submissions) is not enough to persuade Seller Performance to reinstate your account. Amazon sellers are often “shut out” in a sense. Amazon may stop responding altogether, or might just give the seller generic denials. The next step would be to file an appeal with the Bezos Escalation team, but many times this can be a dead end for sellers as well. If you are getting nowhere with Amazon Seller Performance and the Bezos team, you may need to take Amazon to Arbitration to force them to cooperate and provide a substantive response.


Related Account Issues:

Related account issues are difficult because Amazon often mistakenly believes that accounts are linked when in fact they are not. The difficulty is that if Amazon believes that two accounts are impermissible they will not provide any reasoning as to why. For example, one performance notification we have seen at ASL provided: “we found that your account is related to another account that may not be used to sell on the site.


Have you seen this?

Due to the nature of our business, we do not provide details on our investigation methods.”

Another merely states that the account has been suspended because the seller is operating an account that “may be related to an account that may not be used to sell on the site.”

Amazon regularly refuses to provide the substance of its allegations.  Plans of Action are often written in the dark.  Sellers often feel that it is impossible to write a Plan of Action because they are wrongly accused and are not provided any indication of the reasoning behind the accusation.


Lost Inventory:

Although Fulfillment by Amazon is an amazing service that provides amazon sellers with a unique opportunity to grow their businesses, it is far from perfect. Lost inventory is something we hear about regularly at Amazon Sellers Lawyer. Lost inventory is lost money.  Lost inventory is frustrating issues for sellers because so much is out of their control.

When working with Amazon to recoup or seek reimbursement of your lost inventory there is no estimate for how long it will take. Just like with appeals, Amazon may give generic responses or not respond at all to a seller’s attempts to locate their inventory. When inventory is lost, sellers are left with no product to sell. Thus, debts may go unpaid due to lack of sales. When Amazon refuses to cooperate, amazon sellers have no time frame as to when they can get back to selling.

By filing for arbitration in a lost inventory case, you can “take the decision out of Amazon’s hands” and legally bind them to the decision of the arbitrator.


For a suspended amazon seller, recouping your inventory is crucial. If your account issues fall into any of the above categories and your appeal process has hit a dead end, arbitration may be your best option to get you’re your inventory back or obtain reimbursement for the lost goods.


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Email: CJ@AmazonSellersLawyer.com

Phone: 1-877-9-Seller

136 E. Park Avenue Long Beach, NY 11561

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Amazon Sellers Lawyer
Long Beach, NY 11561
Phone: 1-877-9-Seller