Amazon destroys $1.5m of sellers inventory – now homeless

<p><pre><code> The merchants must navigate a largely automated, guilty-until-proven-innocent process in which Amazon serves as judge and jury. Their emails and calls can go unanswered, or Amazon&#x27;s replies are incomprehensible, making sellers suspect they&#x27;re at the mercy of algorithms with little human oversight. </code></pre> This is something our modern society was and is not ready for. Bureaucracy and the bureaucrats that administered it is a nightmare that society has known about and dealt with for a long time. But this is fully automated bureaucracy. Except instead of having well known rules or human bureaucrats we can confront.. we&#x27;re now effectively at the mercy of a dice roll in the worst case. And no one can even confirm if the dice are even fair dice. In the best case you get to deal with a robot that can&#x27;t even understand what you&#x27;re saying.

Yeah, you know, when people keep saying &quot;You aren&#x27;t as far from being homeless as you imagine you are&quot; this is what they mean. Just because <i>your</i> life has not come unraveled overnight doesn&#x27;t mean it can&#x27;t for reasons beyond your control having nothing to do with personal virtues or lack thereof.<p>We really need to get universal health care in the US, among other things, to limit how far people can fall when something crazy happens. We are making it far too easy to fall and far too hard to come back from it and this is why we also see headlines about how society is coming unraveled and the like.<p>Please don&#x27;t see this as some bizarre statistical outlier. Many homeless people were solidly middle class at one time and then things came apart and we are terrible about actively making it unnecessarily harder than it should be to get back on their feet.

This is a case for the courts. The article is completely one sided, and there’s no way to know whether or not some or much or most of the merchandise was counterfeit.<p>He does admit to ignoring up to 11 notices that his inventory would be destroyed if left unclaimed. He mentions conflicting dates for the notices but we’ve no way of knowing to make of that.<p>I don’t know what to say other that I read the piece with some interest and for all know it’s a work of fiction, but heh I clicked.

Some quotes from the recent antitrust report from Congress. These were presumably verified and run by Amazon with opportunity to respond.<p>&gt;In another example, a third-party bookseller told Subcommittee staff that Amazon delisted 99% of his business’s inventory in September 2019.1674 The bookseller requested that Amazon return its products, which were stored in Amazon’s warehouses.1675 As of July 2020, Amazon had only returned a small fraction of the bookseller’s inventory and continued to charge him storage fees.1676 Amazon blocked the bookseller both from selling its products on its marketplace and retrieving its inventory, precluding the seller from trying to recover some of his losses by making sales through another, albeit lesser, channel.<p>&gt;During the Subcommittee’s sixth hearing, Mr. Bezos testified that Amazon “invest[s] hundreds of millions of dollars in systems” that police counterfeits.1823 However, Amazon’s approach appears to be ineffective, resulting in suspensions of many innocent, third-party sellers, with devastating effects on some sellers’ businesses.1824<p>&gt;One third-party seller told the Subcommittee that Amazon blocked some of her listings, citing a number of her products as “inauthentic.” 1827 The seller provided evidence to Amazon that, not only were her vendor’s products authentic, but Amazon actively sold the same products, sourced from the same vendor, through its first-party sales.1828 Despite elevating the issue to Amazon executives in July 2020, this issue has still not been resolved as of September 2020.<p>I&#x27;ve had very similar experiences, as I&#x27;ve discussed [0] here numerous times. I currently have an antitrust lawsuit against TP-Link [1] for making false counterfeit complaints against my Amazon account.<p>[0] <a href="https:&#x2F;&#x2F;hn.algolia.com&#x2F;?dateRange=all&amp;page=0&amp;prefix=false&amp;query=author%3Aikeboy%20tp-link&amp;sort=byPopularity&amp;type=all" rel="nofollow">https:&#x2F;&#x2F;hn.algolia.com&#x2F;?dateRange=all&amp;page=0&amp;prefix=false&amp;qu...</a><p>[1] <a href="https:&#x2F;&#x2F;www.courtlistener.com&#x2F;docket&#x2F;16562550&#x2F;thimes-solutions-inc-v-tp-link-usa-corporation&#x2F;" rel="nofollow">https:&#x2F;&#x2F;www.courtlistener.com&#x2F;docket&#x2F;16562550&#x2F;thimes-solutio...</a>

In a much smaller example, I&#x27;ve been running Instagram ads for the last week. I&#x27;ve been trying to stop this ad for the last 5 days, but there&#x27;s a bug in Instagram&#x27;s UI that won&#x27;t let me. I also can&#x27;t get hold of an Instagram support person, or FB support. So I&#x27;ve kept spending money I don&#x27;t want to spend.<p>FB and Instagram are core parts of society now as one of the major places to advertise. Lack of support of this kind seems like a really bad sign of a future where all you talk to are robots.<p>Also, average cost per conversion thru Instagram is $16 - $33. That is just a straight up toll that is paid to Facebook by every product that wants to advertise on their platform. I&#x27;m not saying it should be free, but surely they can afford better customer service.

I think the most interesting thing here is that Amazon can effectively claim a seller&#x27;s property is fake based on reviews that everyone knows are regularly gamed. Then they can refuse access to the inventory and make the claim, without having to provide any evidence, that the questionable inventory has in fact been destroyed and not just passed on to another seller behind the scenes.<p>Accountability is entirely absent here. On the seller side and on Amazon&#x27;s side.<p>The fact that Amazon had physical control of the questionable merchandise and had no obligation to retain a small sample that would be useful for the owner to defend himself on the challenge of it&#x27;s authenticity or for Amazon to demonstrate that it was counterfeit is troubling.<p>I don&#x27;t have a problem with counterfeit merchandise being identified as fake. I think it is extreme to destroy it all. The existence of eBay, Harbor Freight, Walmart, and Amazon are proof that people will pay for inferior products that look like the originals but are not as durable or beautiful. Once a counterfeit is identified it should be relabeled for sale at a discount since it is a fake. Just like art.

&gt; Hoping to have his account reinstated and continue selling on the site, Govani put off the decision. He received a total of 11 emails from Amazon each giving him different dates at which time his inventory would be destroyed if he hadn&#x27;t removed it.<p>&gt; &quot;After being unable to resolve the matter following several appeals as part of our dispute resolution process, we informed this seller six separate times that they needed to remove their inventory from our store by specific dates or it would be destroyed,&quot; she said. &quot;The seller failed to request to remove their inventory by the dates provided.&quot;<p>I understand the core point here -- Amazon does have the upper hand when making deals with 3rd party sellers. But this is on the seller: he stored his inventory at Amazon, who decided they want to break their deal -- then he failed to move his inventory after what seems like a very lengthy communication, so they ended up doing what they said they would.

I fully believe this, and feel terrible for this seller, having had a similar experience.<p>For nearly a decade I ran a successful side hustle on Amazon from something that was just making beer money to making more than my day job (grew to $6.5 million&#x2F;yr in sales at it&#x27;s peak) and ran into the same thing earlier this summer.<p>Competitors attacking listings with false claims to try and shut your account, or listing down was a regular occurance(search for false &#x27;used sold as new&#x27; -- the old version of this), and a headache that could be addressed although it often would take at least a weeks worth of effort and fights with the automated systems. This last series of attacks -- also counterfeit claims in my case -- no such luck -- the process has changed, the invoices from the same suppliers and letters of authorization from the manufacturer not accepted.<p>As it stands I am waiting on them to destroy roughly $120,000k in inventory that they refuse to release. Maybe more because their inventory tracking is garbage and it&#x27;s not uncommon for items to be lost for months in their warehouse only to magically reappear... The tracking and inconsistent handling of returns is such a mess I can&#x27;t exactly tell as anyone using FBA at volume just has to accept there will be variance between their known inventory and what Amazon says you have...<p>Fortunately, the market I targeted was heavily impacted by COVID so outside of a modest push associated with the back to school season I dodged a bullet as I essentially shut down on the &#x27;buy side&#x27; when that all flared up and focused on getting back to cash.<p>I&#x27;m also lucky that I started scaling things back and looking to build out other channels about this time last year when they and WalMart started just automatically price matching one another, including prices from their respective 3rd party sellers, driving prices into the ground -- even below wholesale in some cases.<p>Amusingly, they have noticed I stopped sending new inventory in and some of their listings are now going unfilled and call at least once a week trying to get me back. (Amazon benefits tremendously from not tying up their cash on inventory and using 3rd party sellers to keep their stock.) When I tell them I&#x27;m willing to come back once they help me resolve this issues w&#x2F; a real person or even go and physically inspect the inventory they have impounded they go silent.<p>I thank them for helping to accelerate my long term financial goals, but to be honest, having been free of them for a few months now, the weight of not living in constant fear of jumping through their hoops has drastically improved my quality of life.

There are a lot of complaints about allegedly fake merchandise on Amazon and people asking for a crackdown. This is what the other side of that story looks like. The old solution of Amazon mostly ignoring the fakes and just compensating people who complain avoids this scenario.

I read the article with a more skeptical eye. It could be that he didn&#x27;t request the items back in time because they were fake and not worth the price of the return shipping. Amazon&#x27;s response was interesting:<p>&quot;The spokeswoman said Amazon repeatedly asked Govani to provide evidence that the products sold were authentic but that the invoices he sent were either illegible or didn&#x27;t match the records of the brand owners.&quot;<p>So he&#x27;s got (by his own admission old), and by Amazon&#x27;s telling, illegible, or the brand disclaims them. It made me think of that scene in Fargo where the car dealer is faxing forms with illegible VINs repeatedly to General Motors to keep his scam going.

After reading the article I&#x27;m still a bit doubtful about the claims of the seller. I&#x27;m not saying that Amazon is in the right here or that he&#x27;s lying about the merchandise being genuine, but some aspects of the story seem rather sketchy. He seems to have been in contact with Amazon for several months, and still he says he was unable to ask them to send his merchandise back to him? If he really ordered his merchandise from the brands directly, how was he not able to simply ask them for a confirmation or proper invoice copy and provide that to Amazon?<p>Fake merchandise seems to be rampant on Amazon, and clothes&#x2F;apparel is a great target because the products are &quot;low-tech&quot; and it&#x27;s hard for a regular customer to tell a genuine article apart from a fake one, so I can see why Amazon is very picky about these things here. Personally I try to never buy such brand items from third-party sellers on Amazon, as my trust in the items being original is quite low.

“ The spokeswoman said Amazon repeatedly asked Govani to provide evidence that the products sold were authentic but that the invoices he sent were either illegible or didn&#x27;t match the records of the brand owners.”

Two things here:<p>1) Binding arbitration. The arbiters know which side of the bread is buttered, you have to have a pretty extreme case to win in binding arbitration. It should be nuked from orbit.<p>2) Comingled inventory--there&#x27;s no mention of whether he used it or not. If it&#x27;s used and someone else sends Amazon counterfeits that get sent to your customer you get blamed for the counterfeit. The only reason they can be sloppy like this is because of #1.

Amazon in Australia is not very good (yet). It&#x27;s nothing like America or Japan, which have huge inventories and same or next day delivery.<p>This is a really really bad look for Amazon, which is in the process of expanding in Australia. Retailers are already nervous about their expansion plans here and this does further bad for their brand.

Seems odd the reporter doesn’t verify the authenticity&#x2F;quality of the submitted invoices.<p>Surely he could produce copies for the reporter?

&gt;&quot;In order to ensure that customers can shop with confidence on Amazon, we take &#x27;inauthentic&#x27; complaints seriously,&quot;<p>&gt;That inventory was everything I had. Amazon ruined my life, and I did nothing wrong<p>This is what a perfect win for IP maximalists looks like - an automated ruination of lives, whenever IP seems to be disrespected.

I keep wondering why Amazon deals with guys like this instead of going to Calvin Klein’s wholesaler. He wouldn’t have better prices for legit merchandise, right?

I don&#x27;t understand why the journalist didn&#x27;t contact the manufacturers to confirm that the products were authentic.

Another Marketplace seller blamed for commingled fakes case?

&gt;After being unable to resolve the matter following several appeals as part of our dispute resolution process, we informed this seller six separate times that they needed to remove their inventory from our store by specific dates or it would be destroyed,&quot; she said. &quot;The seller failed to request to remove their inventory by the dates provided.&quot;<p>This seems more than fair. I&#x27;m not sure why he would put all his eggs in the Amazon basket though.<p>This very much reads like he wanted to keep selling on Amazon despite them trying to get him off the platform

The crux of the problem seems to be &quot;when merchants set up shop on Amazon, they waive their right to a day in court by agreeing to binding arbitration to resolve any disputes&quot;.<p>Is this even legal?

I generally use Walmart and Target for shopping online, but recently I decided to go with Amazon for something (pet supplies) that Walmart, Target, and Chewy didn&#x27;t carry.<p>I created my account, and before I could put the order through, the account was locked for &quot;suspicious activity,&quot; which resulted in a black hole of me repeatedly sending them the information they asked for (a recent credit card statement) and them responding with the same form letter email about being unable to verify ownership of the card. I even called, spoke to a human who said they would do something, but no, same form letter response.<p>Why do people use Amazon over walmart.com or target.com?

Selling on Amazon is really hard. Just one fake product claim from a customer can make your seller account blocked. And because customer is always right, seller has to prove product validity.

File a complaint with the Iowa AG Consumer Protection <a href="https:&#x2F;&#x2F;www.iowaattorneygeneral.gov&#x2F;about-us&#x2F;divisions&#x2F;consumer-protection" rel="nofollow">https:&#x2F;&#x2F;www.iowaattorneygeneral.gov&#x2F;about-us&#x2F;divisions&#x2F;consu...</a> Possible lien on that new massive Bondurant warehouse will get their attention.

This sounds like an awful position to put your business in even if the alternatives weren&#x27;t better.<p>You&#x27;re the middleman between manufacturers who view you as small &amp; Amazon who would view you as small.<p>To me it seems like you&#x27;re just asking to be squeezed out here &amp; taking on a lot of risk. Am I missing something?

Even if they are fake, destroying it is extreme. They should just levy fines or charges on the storage and hold on to it. Atleast not until the seller’s case is open with them. I don’t get how they could be so bad at this.

you know that whole, &quot;never put all your eggs in one basket&quot; saying... that&#x27;s exactly what this dude did and he got burned.<p>while the situation sucks and amazon is a jerk for allowing this to happen... i don&#x27;t feel bad for him. any business man knows not to do this, it&#x27;s rule one in everything you do. it places you in the position where you aren&#x27;t in charge meaning you don&#x27;t have the upper hand. hard lesson for this dude to learn, but hopefully it prevents others from making the same mistake.

I hope the seller sues Amazon, and the judge awards attorney&#x27;s fees and a damages multiplier due to the hardship imposed and the egregiousness of the violation.

Regarding forced arbitration: isn‘t the party that forces arbitration by law required to pay for it and if they refuse, then it can be brought in court?

I don&#x27;t understand the story. He was given several warnings that his stuff would be destroyed. Why is it Amazon&#x27;s fault now?

&#x27;now homeless&#x27; should be removed from HN title. TFA doesn&#x27;t state that and it&#x27;s not in the title either.

we had a similar experience moving item off smaller platform. it&#x27;s a constant barrage of counterfeit claims, even if we sold 1 (one) item, we racked up 10 complaints in a month.<p>it&#x27;s a very profitable model to keep small competitors operations out of the system, so of course it&#x27;s abused to hell and back.

Does Amazon still commingle inventories between sellers? How could they keep track of who provided a fake item?

Imagine if they treat AWS customers this way this doesn&#x27;t seem like the most customer obsessed company

Is it just me or does it seem like he could&#x27;ve avoided it by answering their emails?<p>You gotta keep up with your emails.

So he had $1.5m in merchandise that was totally authentic, sent it all to Amazon and yet couldn&#x27;t reclaim it? And he has no insurance on literally a million and a half of clothing?<p>How did he go from holding $1.5M of merch for <i>over a year</i> to being homeless and having to couch surf?<p>So, I had this $2M bridge up in Wisconsin, but Elon Musk took it out with a cybertruck one night after a few too many mimosas and...

This is what monopoly abuse looks like.

Something something one basket.

&gt; <i>binding arbitration, which the House panel said gives Amazon the upper hand in disputes</i><p>What is the basis for this? I have gone to arbitration against a big company, and won. The arbitrators were all judges, and the only difference from my experience with court proceedings was the speed and cost.

How do sellers track down and get GTINs for this volume of apparel?

TL;DR: Forced arbitration is the worst.<p>Arbitration has its place, but I rather think there should be a &quot;small claims&quot; pecuniary limit on what can be considered eligible for this sort of clause. Anything over a few grand and you&#x27;re talking about sums of money that can literally break people.<p>Seems somewhat inhumane to stifle recourse.

Unpopular opinion: He was told multiple times to remove the inventory or it would be destroyed, in accordance with the contract he signed. He didn&#x27;t remove the inventory.

What I don&#x27;t understand is how someone can keep such poor proof of authenticity when hocking questionable products on Amazon? To pretend that illegible evidence of authenticity is okay is disingenuous. <i>Everyone</i> knows that Amazon is full of fakes. You would think scammers would try to have reasonable proof of authenticity so that when the banhammer comes swinging down, they&#x27;d have a saving grace.<p>Plus, the article is clickbait. I don&#x27;t see how the man is homeless. He&#x27;s not a rough sleeper. He&#x27;s staying with family. To call him homeless is absurd, it cheapens the word and erodes our communal empathy.

US-based meta-comment: I see lots of talk in this thread about the problem of customers just wanting to shout at customer support. Maybe I&#x27;ve got election brain, but does anyone else think this is a symptom of the frustration people feel under a political system that no longer responds to the legitimate grievances of people on the bottom of the social and economic order.