Amazon faces a lawsuit for shutting down 400 seller accounts

Brace yourself because AI-driven attacks are expected to peak this holiday season! In fact, online retailers are facing 569,884 AI attacks each day, on average!

Now, more than ever, you’ll need thorough preparations to keep your brand secure. But don’t worry, we’re always here to help you do that.

And to also supply you with the freshest ecommerce and Amazon news every day. 😉

• Zero-warning seller shutdown 💥
• Get ready-to-use UGC ads in 14 days 🤳
• What’s new with Amazon? 🔉
• The best way to beat your Amazon competition 🥊
• The legal way to buy a seller account 👌

BLACK MARKET

Yesterday, we shared the unfortunate news of wholesale vendor accounts being terminated by Amazon. Now, the retailer is also shutting down seller accounts!

Yahoo! Finance reported that the retailer is facing a lawsuit from Ecom Authority LLC, a Miami-based ecommerce company that manages numerous Amazon stores. This comes after Amazon shut down 400 seller accounts with no explanation and no chance to appeal! 🤯

What happened?

Ecom Authority LLC filed the lawsuit on October 22, stating that   595 of its sellers were affected by account deactivations over the summer.

• Out of the 595 affected sellers, 400 were deactivated and 195 remain active but had their inventory seized or lost control of money stored in their seller accounts.
• The lawsuit alleges that Amazon selectively deactivated accounts without consistent reasoning and failed to explain why inventory was flagged as suspicious. 🚩
• Ecom Authority LLC submitted utility bills, credit card statements, bank statements, and other business documents on its clients’ behalf. But that did not resolve the issue.
• Amazon is reportedly holding $7.2 million in inventory, $524,759 in funds, and has charged $1.7 million in fees for storage and disposal. The total loss is projected to reach $28.6 million.
• One of the affected brands, JNT Capital LLC, filed a separate lawsuit against Amazon for deactivating its account and disposing of 129 Google Pixel phones. However, its efforts to resolve the issue were met with no resolution from Amazon.

💥 Is there hope in this situation?

This isn’t the first time Amazon accounts have been deactivated with vague explanations, funds seized, and inventory disposed of. And ICYDK, Amazon’s Business Solutions Agreement prohibits sellers from suing the company and instead requires them to go to arbitration.

But…

U.S. Rep. Chris Smith reached out to Amazon via a letter in August. Michael Finan, Smith’s communications director, said Amazon agreed to meet with Smith to discuss potential solutions.

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AMAZON ANNOUNCEMENTS

• Deferred transactions status: Starting November 1, 2024, reserved payments of sellers subject to Amazon’s delivery date policy will be displayed as “Deferred transactions” on the Payments dashboard.
• Updated inventory shipment windows: To help brands deal with the peak season, Amazon made the following adjustments:
  • Extended automatic closure window to 90 days for shipments created after August 7 to October 31.
  • Extended abandoned shipments window from 30 days to 45 days for shipments created between August 7 and October 31.
• New Image Manager feature: Amazon launched “Issue Alert” to help manage issues related to product images. Now, you can receive timely issue notifications, view all issues in one place, and conveniently replace images.
• Fast badges: You can now display Multi-Channel Fulfillment (MCF) fast badges on your ecommerce site to show the estimated delivery date on your product detail pages and ultimately boost sales.

BITES OF THE WEEK

• Revamping Shopping: Google rebuilt its shopping platform through AI technology.
• Expanding Services: Amazon's same-day delivery now covers over 80 towns and cities across the UK!
• Building Connections: Join Seller Alliance to be part of an Amazon community you can count on.

SELLER COMMUNITY

The best way to get ahead of your Amazon competition

Selling on Amazon isn’t easy—whether you’re just starting out or have years of experience, the challenges are real, and it’s easy to feel stuck.

But you don’t have to go it alone. You’ve got the drive—now it’s time to join a community that will fuel your success.

This is where Seller Alliance steps in. This community, powered by industry experts who've built 8-figure brands, is designed to help you grow and succeed.

👫 What’s in it for you?

• Access free, valuable resources, tools, and templates from Seller Interactive—without the cost of an agency
• Receive expert advice and personalized coaching from seasoned professionals
• Take advantage of courses and modules to learn skills that boost sales
• Get announcements, information, and insights to stay ahead of market trends

🫂 Selling on Amazon is challenging, but you don’t have to go it alone. Surround yourself with a community of sellers who’ve been where you are—and who are ready to help you thrive.

Join the waitlist

SELLER REFRESHER

Can you legally buy an Amazon seller account?

For new sellers, setting up an Amazon seller account can be overwhelming. That’s why some opt to buy an established account to skip the initial setup phase.

But is this allowed?

According to eCommerce Fastlane, buying a seller account is legal as long as it’s handled carefully and follows Amazon’s guidelines.

❓ So, how can you legally buy an Amazon seller account?

• Find a reputable seller. Use a trusted service with positive reviews.
• Decide on your budget. Know what you’re willing to spend.
• Review terms and conditions. Check the seller’s policies and the account’s history. ⚠️
• Select the right account—and make sure it aligns with your business goals and budget. And don’t forget to ensure compliance with Amazon’s policies by checking out some crucial things:
  • Accounting records. Verify the account's past transactions to avoid issues.
  • Advertising metrics. Understand its ad performance to assess potential profitability.
  • FBA costs. Confirm all fulfillment-related costs to avoid surprises.
  • Competitive analysis. Research similar sellers to gauge your chances of success.
• Use a secure payment method to dodge any legal consequences.

📝 What to do after purchase

• Add your bank and credit card details for expenses.
• Change the username and password for security.
• Update the tax information with your SSN or tax ID.
• Double-check your account name and email to make sure they match and have a smooth transition.

💰 Buying an Amazon seller account can be a great way to jumpstart your business without starting from scratch. Just remember to stay compliant, and you’ll be on the fast track to building a profitable Amazon business!