How to Protect Your Amazon Store From Hijackers and Copycats
Common Intellectual Property Infringement Issues Faced By Amazon Sellers
First, let’s look at a couple scenarios that occur frequently on the platform (you might even have personal experiences with some of these):
1) Another seller is using a store/seller name deceptively similar to yours.
Let’s start with an example. Imagine you have a store that sells exclusively high-end curated sweets from around the world, and is called Marshmallow World. Now imagine that another Amazon seller pops up, also selling sweets from around the world, and the name of the store is Marshmallow Planet. Do you think it’s an innocent coincidence? (Hint: it’s probably not.) Whether intentional or not, there’s a good chance that the similarity of the name and the type of products sold will have customers confused. Why is this a problem? Let’s say Marshmallow Planet doesn’t prioritize product quality to the same extent you do. Your buyers, who’ve become accustomed to your quality products and stellar customer service, may mistakenly believe that Marshmallow Planet is your store – and when they receive substandard treatment and a disappointing product, they’ll be unhappy with you. This is just one example of why it’s so important to protect your business name, logo, and product identifiers with good trademarks. In this scenario, unless you have strong trademark protection and adequate enforcement processes in place, you can brace yourself for an influx of negative reviews, a drop in your rating, and having to watch your product slowly sink to page 12.
2) A competing seller is selling knockoff products with your branding, claiming that the products are your authentic brand.
Once a private-label product starts gaining popularity on Amazon, it’s only a matter of time until another seller finds a manufacturer willing to copy it – including your packaging, materials, and product design. The infringer will then attempt to hijack your Amazon listing by offering their lookalike product for less than the price of yours. Once they have the “buy now” button, they get all the sales. This is another scenario where having adequate IP protections in place can help you get counterfeit products and listings containing your branding removed from the platform (and pursue further legal remedies).
3) Another seller copied your pictures and/or description for a different listing.
Your pictures, creative designs, and in many cases, your written product descriptions, enjoy federal copyright protection the moment they are created. You own the exclusive right to such original, creative content, and can prevent others from using or reproducing it without your permission. Again, the level of protection and ease of enforcement of your rights depends on what steps you’ve taken to protect your brand before the infringement occurred.
4) Another seller sends you a cease and desist letter demanding that you remove one of your products or listings from the marketplace.
Many legitimate sellers have received letters from other companies demanding threatening to shut down their sellers account if their listing is not removed. Sometimes it’s an intimidation tactic. Other times the sender is someone who obtained the goods from a wholesaler and is oblivious to the fact that it’s your company’s product. In any case, receiving fake and mistaken cease and desist letters is just a part of doing business on Amazon. Due to the very real possibility of having a dispute filed against you by another seller, it’s always advantageous to have your IP registrations and other proof of ownership ready prior to any claim being filed.
What You Can Do To Protect Your Product/Store From An Attack
There is a good chance that, sooner or later, one or more of the above scenarios will apply to you. The good news is, you can implement an enforcement strategy before SHTF, so you can minimize any damages and business interruption that may occur as a result. We’re big proponents of being proactive rather than reactive when it comes to protecting your business and valuable IP. Here are some of the steps that we recommend taking immediately, in order to avoid losing your reputation, or worse, having your Amazon account shut down as a result of an infringement dispute:
Step 1: Perform an IP Audit
If you own a business, online or offline, chances are you have valuable IP in the form of trademarks and copyrights that are worth protecting. Generally speaking, your trademarks are your brand identifiers: usually a name, logo, and/ tagline (though it can also be a sound, smell color, motion, or any combination of these.) It’s some sort of symbol that indicates to customers that the product they’re looking at comes from you, and not another manufacturer. If the average consumer associates the mark with your business, there is a good chance you have a trademark. Some common trademarks owned by Amazon sellers include: store names, store logos, product names and logos, unique phrases/taglines, product packaging, and in some cases, the designs of their products. Copyright refers to the exclusive legal rights that creators have to their original works. Whether it’s your product photos, packaging and other designs, your creative product descriptions, designs on the products themselves, or any other creative works, the exclusive right to use, reproduce, copy, display and sell these original works belongs to you. The requirements to have a copyright are a) it is an original work has an element of creativity, and b) it is fixed in a tangible medium of expression, meaning it’s not simply an idea in your head. It exists outside of your thoughts, whether by virtue of being written down, saved in the cloud, or sitting on your desk in the form of a Play-Doh sculpture. For our purposes, your copyrights would be the creative parts of your Amazon listing – a professionally shot product photo that really captures the essence of your garlic press, a product package that is a masterpiece of graphic design, or a particularly poetic product description. It is important that you perform an IP audit to identify all important trademarks and copyrights that you can legally enforce against hijackers and infringers. If you don’t have a unique company name, logo, or other branding that sets you apart from the competition, this would be a good time to consider making such an investment. There is definitely an advantage to having a distinct and unique brand. It’s also advantageous to take it a step further, and have your unique logo that printed on the actual product itself, as well as on all packaging associated with that product or store. By creating a link between the product and the branding, you’re deterring infringers from attempts to hijack your listing, as they can’t fool the customer into thinking that their product is yours, without blatantly stealing your logo and packaging – something that many of them simply will not do.
Step 2: Register your Trademarks and Copyrights
Even though your unique brand identifiers (trademarks) and original content (copyrights) enjoy automatic protection under federal and state laws, registering them with the appropriate federal agencies has some distinctive advantages. For Amazon sellers, one such advantage is the ability to remove infringing products and listings posted by other sellers. Due to the sheer number of infringement complaints made by sellers every single day, it is next to impossible to get Amazon to remove an infringing product or description, unless you can clearly document that you are the true owner of the brand or content in dispute. You need to prove that the other seller is infringing on your intellectual property rights by submitting clear evidence of use and ownership of the brand and/or content. Trademark and copyright applications and registrations are among the strongest form of evidence of such use and ownership. Trademark applications are filed with the United States Patent & Trademark Office (USPTO). Once you file your application, other requests for the same name/design in the same classes will not be accepted while your application is being examined. Amazon often deems a pending application, along with proof that you’re using your trademark in commerce, sufficient proof that you are the true owner of the brand. (This means that you don’t have to wait the 8-9 months that it takes for a mark to actually register, before you can rely on your federal filing as evidence of your ownership.) Copyright applications, on the other hand, are filed with the U.S. Copyright Office by submitting either an electronic or physical copy of the work you are registering. The typical time frame for copyright registrations is 4-5 months from application, though some works may take longer. However, once the registration is complete, the effective date of protection as a registered copyrighted work is the date you completed the application.
Step 3: Monitor Your IP Rights
Just like it’s a good practice to set up Google alerts to notifiy you of possible IP infringement, it is also a good idea to routinely log in to your Seller Central dashboard every day, and check on a) how many sellers are on your private label listing, and b) whether there is any unusual decrease in sales volume, which can indicate a possible hijacking scenario.
Step 4: Take Advantage of the Amazon Brand Registry
An essential step in protecting yourself against hijackers is to register your brand with Amazon. It is a very straightforward process that starts with the Amazon Brand Registry Application, with the rest of the steps detailed on the Amazon website. While Amazon’s rules clearly state that “enrolling a brand in the Brand Registry and registering as the brand owner does not prevent other sellers from selling the branded products,” (people who purchased the product from you and are now re-selling their non-counterfeit items are perfectly within their rights to list them on Amazon), you will have more control over the listing. With a registered brand, it will be difficult for anyone to change your private label listing without your express consent. In addition, if you can prove, with photos and descriptions, that someone is selling a counterfeit product, you can have Amazon remove the hijacker’s listing.
Step 5: Send a Cease and Desist Letter
If you discover that another seller is infringing upon your IP rights, your quickest option for resolution may be to send a cease and desist letter (also known as an enforcement letter) to the infringing seller. Since sending a cease and desist letter may expose you to certain risks — such as causing the infringer to sue the IP owner or challenge the owner’s trademark registration, or starting the time limitation for the IP owner to sue — it is always recommended that you consult with an experienced IP attorney prior to transmitting any cease and desist correspondence. However, if done right, cease and desist letters can be an effective tool against Amazon hijackers and copycats. If you are inclined to send a cease and desist letter, make sure that it complies with the following requirements: It Specifically Lays Out the Rights You’re Claiming to the IP in Question Your letter must clearly articulate what IP rights you own, and specify the products and services in connection with which you claim to own said IP. Make sure that your logo is actually used as a trademark for the product, and that you actually own a valid trademark (for instance, it can’t be a mere description of what’s in the box – Chocolate Covered Strawberries is not a trademark if you’re selling chocolate covered strawberries, no matter how fancy the font you are using). The best way to do this is to have an actual federal trademark registration; however, keep in mind that an infringer can always challenge the validity of said registration. Without a federal trademark registration, you can always rely on your “common-law trademark rights,” which are trademark rights available based on using the mark in your business, but which are limited to the geographic area where the mark has actually been used. This is more difficult to prove than having a federal registration, and is not favored by Amazon due to the level of administrative scrutiny required to decide a case. It Specifically States the Claim You’re Making Against the Infringer The cease and desist should specifically state what your complaints are, and should include the following proof: 1. Screenshots of the listing 2. Screen shots of bad reviews evidencing consumer confusion and the substandard quality of the counterfeit product 3. The ASIN number 4. A link to the listing 5. Pictures of the products and packaging (both theirs and yours) 6. Proof that you’re the owner of the brand. The point is to a) document everything before the copycat can make their move, and b) let the infringer know that your claim is well-founded, and you’re prepared to take it to Amazon, and even to court, if necessary. Not skipping this step may also help correct a copycat who might not be familiar with US trademark laws, and might believe that copying products of other sellers is a permissible business practice (spend 10 minutes on Alibaba and you’ll know what I’m talking about). It Specifically States the Legal Basis for the Claim Your enforcement letter should always include a thorough (and correct) legal analysis. This is important, because if the legal analysis is wrong, the infringer could take the cease and desist letter to a court and ask for a declaratory judgment, in which the court declares that no infringement occurs. Not only does this expose you to the possibility of having to pay court fees, you might be subjecting yourself to the jurisdiction of a court of a completely different state, where you may be subject to various tort claims, including unfair competition, tortious interference with a contractual relationship, and other fun claims that you’ll then have to defend. The bottom line is, you need to analyze your situation and make sure that you actually do have a solid legal basis for your enforcement letter, and consider the defenses that may be raised by the other party. Some questions to ponder include: 1. Could this actually be your product? Could the other seller have bought it from a wholesaler or one of your past customers, and is now simply re-selling it on Amazon? If the other seller legitimately purchased some of your product and is now selling it for less than you are, you have no IP claim against that seller. (On a side note, you may have a breach of contract claim against the wholesaler or past customer that sold the item to your competitor, but only if you have a contract prohibiting such sales, and only against those parties that you contracted with. If there was no contract, you have no recourse.) 2. Do you actually own the trademark to this product? Do you have a federal trademark registration? 3. Are you just a re-seller of someone else’s branded products (in which case you don’t have any IP rights to base an infringement claim on)? 4. Does the infringer have a trademark registration or pending trademark application with the USPTO? Could you and the infringer both have legitimate common-law trademark rights? Has the other seller been selling this product before you have? Could you be the infringer? 5. Do you have a copyright claim, in other words, did they steal original creative content that was prepared by you or your staff, whether it be the literary elements of your listing copied word for word, your packaging designs, your photos or something else? 6. Is this a case of full-blown counterfeiting, where the infringing seller has copied your product, and your branding, and is independently manufacturing substandard goods identical in appearance to your private-label product? 7. Did anyone from your business sign any contract allowing anyone else to use the trademark or copyrighted material at issue? If you can’t answer any of the above questions in the affirmative and with confidence, and/or you don’t have a good understanding of US trademark and copyright laws, you should immediately contact an experienced intellectual property lawyer before sending a cease and desist letter. Remember, this type of correspondence is a legal action that can easily lead to drawn-out and expensive litigation, with significant consequences to your business and brand. It Includes a Specific Set of Demands Your cease and desist letter needs to specifically spell out what it is that you want (your demands), and how long the other party has to comply with those demands before you take further action. In most cases, the initial demand is for the infringer to remove their listing and stop selling the infringing products. If the products are truly counterfeit, i.e. contain the original seller’s branding, the demand may include destruction of the remaining inventory to ensure that they do not enter the market. (On the other hand, in a less severe case of infringement, a seller may give the copycat some time to sell their remaining stock, in order to ensure that they don’t sell the knockoff products in the future.) Whatever it is that you’re demanding the other seller do (or not do), make sure that your enforcement letter states it clearly and specifically. It is Polite As a general rule, I always write my enforcement letters in a way that it wouldn’t bother me if they were posted on social media. People do this every day, especially if they feel like I’ve just wrongfully accused them of something they didn’t do. They want to make it public, so the public can tell them they are right and I’m a POS. Which is why I try to maintain a professional tone throughout all of my communications with an opposing party. If you’re a smartass like me, who can’t seem to draft anything without a healthy dose of sarcasm, just write the letter and edit out the sarcasm later. In it’s final form, your cease and desist should be a clear statement of your IP rights being violated; what actions on their part you believe constitutes violation; evidence of your ownership of the IP; your specific demand; and an overview of the relevant law. It should also be well-formatted and spellchecked, and if not drafted by a trademark attorney, at least reviewed by a lawyer. At the end of the day, whether you’re successful or not will depend on the strength of your legal arguments. Remember, a well-written enforcement letter can be a highly effective tool against potential infringers, hijackers, and counterfeiters, but only if the law cited is on point and supports your position.
Step 6: Enforce Your IP Rights Against Infringers
Once your copyright, trademark and Amazon Registry applications are filed, you’re equipped to bring (and win) infringement disputes on Amazon. But before you do, make sure that the other seller is actually violating your IP rights. (See discussion under Paragraph 3, above.) If the other seller is not in the wrong, filing a claim would not only be a waste of your time, but could expose you to liability for the other side’s damages and attorney fees as well. If your investigation reveals that you’re the owner of the IP and the goods were not legitimately purchased by the other seller, you can start taking steps to have them removed from the site. For trademark violations, Amazon usually requires a “test purchase” of the infringing goods and an investigation as to their authenticity. There are trademark investigators who specialize in test purchases, and provide clients with comprehensive reports detailing the similarities and differences between the products. You can use the findings in the report to write a cease and desist letter to the infringer. If that fails, the report can also be submitted to Amazon, along with the enforcement notice and proof of ownership, as additional evidence supporting your infringement claim. With regard to copyright violations, Amazon generally follows the procedures of the Digital Millenium Copyright Act (DMCA). The DMCA take-down notice procedure consists of submitting proper evidence of copyright ownership, with sworn statements verifying the accuracy of the take-down notice. Upon receipt, Amazon promises to “expeditiously” remove the infringing works. (Proving ownership of copyrighted works may take a few submissions, as Amazon has a tendency to issue multiple requests for additional information. Don’t be discouraged – if you have additional information, keep supplementing your claim until Amazon removes the infringing listing.) As a last resort, if Amazon will not remove the product or listing, or the seller is present on other marketplaces and/or has its own website, you might want to consider filing a lawsuit in Federal Court. This can be a drawn-out and expensive endeavor; however, if you have proper registrations in place, in addition to injunctive relief (a court order prohibiting the other seller from selling the goods), you may also be able to recover damages from the other party, either in the form of actual damages (the money you lost as a result of the infringement), or statutory damages (which may run up to $150,000 in willful infringement cases), and may even recover the amount you spent in attorney fees to enforce your registered IP.
The bottom line is, for many small businesses, the trademarks and copyrights owned by the company can be among its most valuable assets. Being proactive about developing and protecting this valuable IP can save a lot of time, money and headaches when it comes to enforcing these rights later. Starting your Federal applications today can be an important, yet cost-effective investment in your brand. Disclaimer: Nothing in this blog constitutes legal advice, nor does reading or implementing the legal information provided herein create an attorney-client relationship with our Firm. If you would like to receive specific legal advice about a particular issue, please schedule a consultation with an attorney.