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Businesses The Almighty Buck

Amazon Was Tricked By a Fake Law Firm Into Removing a Popular Product, Costing the Seller $200,000 (cnbc.com) 98

Eugene Kim, reporting for CNBC: Shortly before Amazon Prime Day in July, the owner of the Brushes4Less store on Amazon's marketplace received a suspension notice for his best-selling product, a toothbrush head replacement. The email that landed in his inbox said the product was being delisted from the site because of an intellectual property violation. In order to resolve the matter and get the product reinstated, the owner would have to contact the law firm that filed the complaint. But there was one problem: the firm didn't exist. Brushes4Less was given the contact information for an entity named Wesley & McCain in Pittsburgh. The website wesleymccain.com has profiles for five lawyers. A Google image search shows that all five actually work for the law firm Brydon, Swearengen & England in Jefferson City, Missouri. The phone number for Wesley & McCain doesn't work while the address belongs to a firm in Pittsburgh called Robb Leonard Mulvihill. The person who supposedly filed the complaint is not registered to practice law in Pennsylvania. One section on Wesley & McCain's site stole language from the website of the Colby Law Office. The owner of Brushes4Less agreed to tell his story to CNBC but asked that we not use his name out of concern for his privacy. As far as he can tell, and based on what CNBC could confirm, Amazon was duped into shutting down the seller's key product days before the site's busiest shopping event ever.
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Amazon Was Tricked By a Fake Law Firm Into Removing a Popular Product, Costing the Seller $200,000

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  • by Anonymous Coward on Thursday September 07, 2017 @01:48PM (#55154661)

    Five bucks says Amazon won't compensate the seller for the loss of revenue. But you better believe that if one of Amazon's suppliers did this to Amazon, there'd be lawsuits galore.

  • by Joe_Dragon ( 2206452 ) on Thursday September 07, 2017 @01:50PM (#55154677)

    There needs to be an ip / DMCA / trade marks / etc review with fines payed out for BS link this or just can only be taken down by court order.

    • by Anonymous Coward

      Who's going to pay the fine? No one knows who filed this claim - all the identities cited are faked or stolen.
      As long as email exists, frauds like this will happen. In fact, faking court orders to get Google to take down search results and delist sites is another notable use of fake identities and communications sent through email.

      I guess what we really need is a non-anonymous internet with verifiable identities at all stages, so legal business can be safely conducted.

      • by Anonymous Coward

        Who's going to pay the fine? No one knows who filed this claim - all the identities cited are faked or stolen.
        As long as email exists, frauds like this will happen. In fact, faking court orders to get Google to take down search results and delist sites is another notable use of fake identities and communications sent through email.

        I guess what we really need is a non-anonymous internet with verifiable identities at all stages, so legal business can be safely conducted.

        So lawyer (or other professional credentials) verification could be a use for blockchain.

      • by LocalH ( 28506 ) on Thursday September 07, 2017 @02:41PM (#55155003) Homepage

        >Anonymous Coward
        >I guess what we really need is a non-anonymous internet

        gud1

      • by sandbagger ( 654585 ) on Thursday September 07, 2017 @03:15PM (#55155217)

        >No one knows who filed this claim - all the identities cited are faked or stolen.

        No-one knows yet. The identities are fraudulent but the motives are not. Someone did this to hurt them, not just play rough and tumble capitalism. I'd start by asking the owners a few questions:

        1) Do you have any particularly disgruntled ex-employees?
        2) Is there a competitor who has been particularly aggressive?
        3) Did anyone on the executive get divorced recently?

        This probably was not done by someone on the other side of the Earth who never heard of the product. It was done by someone who knew them and wanted them hit when they were vulnerable. That's going to be a very short list.

        I'd imagine that Amazon's fraud department has a bunch of interns data mining to see if they can't help narrow that list even further because right now they need to demonstrate good will. You can also bet that the defamed law firm will not be letting this slide.

        Of course, proving this in court may be another matter but it may never need to get to that. The suspect may go bankrupt in pretrial.

      • Yeah because this could never ever have been commited by snail mail or telephone...
    • by Anubis IV ( 1279820 ) on Thursday September 07, 2017 @03:20PM (#55155243)

      Instead of a fine, which is difficult to collect in the case of a fictitious entity, what about requiring a bond?

      We already see bonds being used in legal disputes over intellectual property. For instance, if Apple sues Samsung and asks the court for an injunction against the sale of Samsung products, Apple will be forced to put up a bond. If it later turns out that Samsung was in the right all along, that bond will be used to compensate Samsung for the sales lost during the injunction.

      Given that a DMCA takedown acts as an injunction, why not require that anyone filing a DMCA takedown request provide proof that they are bonded? If it later turns out that they perjured themselves, filed a false claim, or otherwise abused the system, the victim of the takedown notice won't have to hunt down the abuser to receive compensation. Instead, they can simply go to the surety company to collect their compensation, just like you would with a bonded contractor.

      This also has the benefit of slowing down or at least discouraging any given company's ability to abuse the system. After all, if they maintain the minimum bond allowed and it was just paid out to a victim, they won't be able to use it to secure a future takedown notice until they pay it back, effectively preventing them from filing any more takedown notices. And if they keep a bond for more than the minimum, they'll potentially be out quite a bit of money if they start abusing the system.

      Unfortunately, I have no idea how to get around the biggest problem with this idea: if the minimum bond is too large, say, $100K, normal people wouldn't be able to protect their work since they couldn't afford the minimum bond, while if the minimum bond was too small, say, $10, it wouldn't be useful in the least in compensating victims for their loss. Maybe there's a way around it, but I haven't figured out a way to make it both fair to big companies and Joe Schmoes while still discouraging abusers in the few minutes it took to type this comment.

      • This hurts the little guys who can't put up enough money to take on people who stole their work though...
        • ...which I specifically mentioned as a problem that I didn't know how to get around.

          • by Anonymous Coward
            It's an easy problem to get around. Accept both submissions - with and without bond. If a bond is put up, act on the request immediately. If no bond is put up, verify the request before acting on it. Large companies can easily put up the bond and get immediate action. Small companies may not be able to put up a bond, but at least still have a way to submit a takedown request, it just may take longer for the takedown to occur.
            • That could work. Right now, service providers like YouTube have to "expeditiously" remove infringing content if they want to maintain their safe harbor status that keeps them from being held liable for that content. But if we removed that requirement for takedowns that aren't bonded, it'd give hosts a means to vet the claims that are more likely to be abusive, while also incentivizing the big players to play nice.

      • by Vektuz ( 886618 )
        This would work in a world where the laws were being made to actually protect folks instead of better the interest of those paying for the laws.

        But we don't live there.
  • by Joe_Dragon ( 2206452 ) on Thursday September 07, 2017 @01:54PM (#55154709)

    sue for fraud 800K + legal fees seems about right.

    • by PPH ( 736903 ) on Thursday September 07, 2017 @02:12PM (#55154805)

      Turn the case over to the (state) licensing authority with jurisdiction. Practicing law without a license [wikipedia.org]. Possible criminal penalties.

      • by Anonymous Coward

        Not only that, this is probably one of the only cases where the DMCA's perjury clause actually applies: the party who sent the notice claimed to legally represent someone they don't actually represent, which is the only part of the DMCA takedown notice that must be made under penalty of perjury.

        Since there are definitely criminal penalties for perjury under the DMCA, the seller may be able to convince the FBI to open an investigation and subpoena Amazon for any logs containing possible identifying info of t

        • amazon may face accessory criminal penalties as well.

        • by HornWumpus ( 783565 ) on Thursday September 07, 2017 @03:34PM (#55155325)

          You've obviously never tried to get any cop to help you with any property crime.

          They will give you a police report, for your insurance. That's all. You can have 'them' on video, the cops won't care. With the narrow exceptions of perps that have already pissed the cops off or perps who are cops (the second is 'danger Will Robinson' for you). If the video is good enough perhaps the local news will use it to get some ratings. You're on your own.

    • Sue who? (Score:5, Interesting)

      by Solandri ( 704621 ) on Thursday September 07, 2017 @02:34PM (#55154949)
      It looks like the person(s) who filed the complaint created a fake law firm site using info stolen from a real law firm's site. It wasn't good enough to pass a 5 minute sniff test, but apparently was good enough to pass Amazon's 1-click non-test. Likely the person(s) filed the fake complaint (and set up the fake website) using an anonymous email account.

      The onus in these cases has to be on Amazon to expend the resources to properly vet these claims before acting on them. If there were viable competition between marketplaces, this wouldn't be a problem. Sellers would abandon the flaky/lazy marketplace and move to ones which treated them better. But Amazon dominates online sales, much like eBay dominates online auctions.

      This is the whole reason we revolted against walled garden online services (AOL, Prodigy, GEnie, MSN) in the 1990s in favor of the open Internet. Having a handful of companies acting as gatekeepers just presents too much opportunity for abuse. When Amazon first started, I was hoping multiple online retailers like it would blossom and we'd rely on price search engines (like Pricegrabber) to invite competition between all online retailers. Unfortunately that hasn't really happened, and if anything the public seems to be gravitating back towards the walled gardens (iOS iTunes, Google Play on Android).
      • Sue John Doe and the firm that hired him. Also make police reports to various agencies.

        They used a Godaddy account and Microsoft hosting. You think there isn't a money trail or a log of connections to the host? Some two-bit fraudster thought this was a good idea. You've got a pretty good chance that they made mistakes.

      • Re:Sue who? (Score:4, Informative)

        by Anubis IV ( 1279820 ) on Thursday September 07, 2017 @03:43PM (#55155373)

        The onus in these cases should be on Amazon to expend the resources to properly vet these claims before acting on them.

        FTFY, but the problem is that the DMCA doesn't work that way (though I wish it did).

        In fact, it's been structured to incentivize Amazon to NOT expend any resources at all, since doing so may open them up to legal liability. Under the terms of the DMCA, service providers like Amazon enjoy a limited immunity against being held liable for copyright infringement on their service that took place at the direction of their users. In order to maintain their safe harbor status, service providers are required to act "expeditiously" to remove allegedly infringing content in response to a takedown notice. I.e. The DMCA presumes the recipient of a takedown notice is guilty and is structured such that it places the burden of proof nearly entirely on them.

        Vetting the claim has the potential to open Amazon up to liability for their users' misdeeds, since either taking too long to vet or outright denying the claim would mean that they failed to act expeditiously. Google has given up their safe harbor status on a few occasions to defend users who were CLEARLY in the right, but that sort of thing is the exception, not the rule, and no service provider can currently be reasonably expected to do otherwise in all cases.

        • by nasch ( 598556 )

          What does this case have to do with copyright or the DMCA?

          • Admittedly, it wasn't specified which form of IP they were dealing with, so it could have been trademark or patent, I suppose. Other comments revolved around the DMCA and copyright on account of their prominent role in these sorts of situations, and I apparently allowed myself to be sucked into framing the entire discussion in those terms. Thanks for calling me on that.

            • I insist you cease being so reasonable and gracious. This is the internet!

              • by Anubis IV ( 1279820 ) on Friday September 08, 2017 @12:39AM (#55157377)

                My apologies. What I had intended to baselessly assert was that you're a no-good Commie intent on the destruction of our wholesome, American values. After all, every decent American hates the DMCA, so it's clearly responsible for the evils being perpetuated here. The fact that you would dare imply otherwise suggests you're the sort of treasonous person who enjoys clubbing baby seals between attending Nazi rallies and crafting your next astroturf post against net neutrality.

                A pox on you and your kind, good sir!

  • by Anonymous Coward on Thursday September 07, 2017 @01:56PM (#55154719)

    I want to know why Amazon just passed this along without vetting the law firm out? Doesn't anyone do something as simple as making a phone call, checking if the law firm is even licensed? All this is easy enough to obtain. Especially when your being ask to revoke a customers product.

    • by green1 ( 322787 )

      This was an IP infringement claim.
      In those cases you are always presumed guilty unless proven innocent in a court of law.

      Best laws money can buy.

      • To be fair to Amazon(I can't believe I am saying this) they have been taking a lot of heat recently for selling counterfeit goods. So it sounds like they are trying, just not hard enough!
    • It should be simple.

      ----

      To issue a complain to remove any item offered by Amazon or any of its resellers, you must first register with Amazon and have your registration verified prior to issuing any takedown request. If you fail to register, your complaint will be ignored. This process is required to protect our partners from malicious / anonymous take down notices.

      • To issue a complain to remove any item offered by Amazon or any of its resellers, you must first register with Amazon

        Amazon doesn't get to make its own laws. Not yet, anyway.

    • by Higaran ( 835598 )
      I'm sure they get dozens if not hundreds of these a year, i could image that its just their own office systems that stalled the process for the seller. I don't fault Amazon, they are just covering their own asses, it really is the sellers responsibility to prove to them that everything is legit.
      • Re: (Score:2, Insightful)

        by Anonymous Coward

        Only hundreds? I work for an online retail company with about 160 employees, and we received around fourteen thousand legal notices last year. Most were fake DMCA violations claiming they owned the pictures we took of our products. Some were fake patent claims. A few were patent trolls like Intellectual Ventures. They targeted us since we're in the same building in Eastgate Bellevue, WA, and we called the police on them a couple of times when their drunk employees were vomiting on the sidewalk multiple

    • I want to know why Amazon just passed this along without vetting the law firm out? Doesn't anyone do something as simple as making a phone call, checking if the law firm is even licensed? All this is easy enough to obtain.

      Sounds like Amazon needs to brush up on their processes and procedures.
      I know a vendor than may be able to help them ... oh, wait.

    • Why didn't Amazon vette the source?

      Because when you do something wrong, the wronged parties certainly don't owe you an expensive sports car.

  • inventory was in Amazon's fulfillment center what if they got an court order to get it back (with amazon still not letting it out or saying that you must buy it and it is not in store at this time) and they just showed up at the fulfillment center with the county sheriff how would of that played out??

  • by gurps_npc ( 621217 ) on Thursday September 07, 2017 @02:14PM (#55154819) Homepage

    Amazon did not do reasonable due diligence and was the party tricked by the fraud, they should be the one to pay a penalty.

    This on top of fraud complaints made against whoever did the fraud in the first part.

  • Swearengen (Score:5, Funny)

    by Dancindan84 ( 1056246 ) on Thursday September 07, 2017 @02:32PM (#55154913)

    all five actually work for the law firm Brydon, Swearengen & England in Jefferson City, Missouri.

    Cocksuckers!

  • The original brush heads for sonicare is outrageously expensive. As bad as the ink jet printer replacement price gouging.
    • ink jet printer replacement price gouging

      The only way to win is not to play. Go laser unless you need photo printing.

  • by DivineKnight ( 3763507 ) on Thursday September 07, 2017 @05:02PM (#55155913)

    And thus the end of the human race came not with a roar, nor applause, nor whining, nor crying, nor even silence, but with the air heavy with apathy.

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