CJ Rosenbaum has over 20 years’ experience as a lawyer in New York. His Global Sources Summit presentation topics included trademark and copyright violations, trade dress, unauthorized sales and MAP pricing as tactics.
Presentation title: How To Stop Hijackers on Amazon
Speaker: CJ Rosenbaum, Esq., Amazon Sellers Lawyer
For more useful info about selling online, check out Global Sources Summit, a conference for online & Amazon sellers held every April and October in Hong Kong. Learn more: www.globalsources.com/summit
How to Stop Hijackers on Amazon
Okay now. Yes with this particular lawyer, you get your second divorce half off, okay? And we do get a bad reputation especially in the States because we kind of did that to ourselves and, I’m actually am a reformed ambulance chaser.
I’ve tried probably close to a thousand cases over the years, ah, but now the focus is, is solely entrepreneurs and almost exclusively on Amazon. But we are down to earth business people; we are entrepreneurs just like you. Okay so in order to; to keep hijackers, to get hijackers off your listing, you have to know a little bit US law, okay? So this is Global Sources law school 101, okay? You’re going to learn what a trademark is and what a trademark violation is. What is copyright and what’s a copyright violation. This thing called trade dress; we’re going to talk about a bit. Unauthorized sales and MAP pricing and then we’re going to talk about something it’s a term that I’ve actually adopted into our Amazon practice from New York divorce law, okay? Called transmutation and it is a 100% made-up term okay?
Okay, what is a trademark, okay? What is a trademark; all of these things when you see any of these marks okay, and we’re going to start with some of the basics which a lot of you already know and they’re going to get to some little more advanced issues that some of you may not be aware of; but if you’re buying an Apple product or Starbucks coffee, you know it’s going to be a bit bitter and you’re going to overpay or if you get McDonald’s right? You know exactly what that hamburger is going to taste like around the entire globe but you know the quality is not so hot. But you know exactly what you’re going to get. Now what is a trademark violation? If you should take this master card logo and you stick it on your shirt or your hat or you take that Starbucks logo and you have it put on your own mug at any factory on the planet whether it’s in China or India or Thailand doesn’t matter where, that is a violation. You cannot take somebody’s logo. You cannot steal my logo and put it on your law firm; that is a trademark violation. Okay now, what’s not a trademark violation? If you’re selling the real deal, okay? If you get ah the same factory that’s making Starbucks mugs and it’s the same glass and the same people and the same factory and you’re buying it from the back door like Mike talked about, you’re not violating IP rights – you didn’t steal it; you got it through a hole in the distribution. Okay? Now it may have sort of the same flavor to it but it’s not an IP violation.
What is clearly not protected, okay? Now I use this because supplements are huge in the U.S. We all want to lose weight except we don’t want to stop eating! Okay? We’ll eat any pill, any substance, buy any exercise device and hang our clothes on it, but we won’t eat healthier. So, this is a great example, things that are not protected. That’s a picture of a fruit that grows in nature okay? I don’t care what naturewise said in this particular case, it’s not something that is protectable because it occurs in nature. There’s a very fancy jewelry design by Ven or something like that, where they have like clover type jewelry and this was a big, big case because their whole business is based upon this. The shape itself was not able to be protected. What they did with the shape was the court kind of cut hairs there. The name of a substance is not something that can be protected; the how it’s packaged like GMO-free and a vegetarian shell, right? Most color schemes are not protected, okay? There are no IP rights, no matter how many complaints you might get on your account, they’re simply not rights that are protectable. The person making that are protected the person making that complaint is making a baseless complaint, okay?
Now the basics, the absolute basics if you want to protect yourself, if you want to protect your brand, if you want to protect your income, okay, from hijackers, you got to start with the Billy basics, okay? You got to file for trademark protection, you develop a really cool logo like this or a Starbucks logo or whatever your private label is, file! You can do it yourselves; you don’t have to hire me. You don’t have to hire any other lawyer; the trademark application is easy you can do it yourself, okay? Now at the same time that you’re doing your trademark application, whether you’re doing yourself or you’re paying someone else to do it for you, you can also file through WIPO or the World Intellectual Property Organization and for about $300 per country you can get some really good substantial protection for your mark okay? And that’s what you want, just like Mike’s and I agree a hundred percent with what he said – you need protection where the problem’s going to be, okay? Because this happens all the time – clients come in “our factories is copying us”, “someone else is copying us”, they’re in China, they’re in Vietnam, they’re in Thailand, they’re in India – those factory owners don’t give a hoot what the Southern District of New York has to say because it’s never going to reach back and touch them so you don’t care, so file WIPO. What you have a problem with WIPO is, WIPO does not really coincide all that great with China, at least not yet. So China specifically, since there are so many factories in China we do reco, do recommend that use a Chinese lawyer to get it exactly right. WIPO still pretty good but you should really do it correctly where all the factories are, a lot of people especially around the U.S. have a lot of bad things to say about the Chinese factories and counterfeits; and I think a lot of is, a lot is very close-minded because if you have 95% or 90% of the factories in one place not only are 90% of the genuine products going to be made there but 90% of the counterfeit is going to be made there, okay? So
Billy basics – you want to protect yourself from hijackers? File where you’re selling it; file it in the US; file it in Europe, okay? But you also got… ah…file at, where your risks are and your number one risk by far is your own factory okay? By far, so get the protection there I agree with Mike when you’re doing those contracts, you know contracts, you choose what law is going to apply and you identify where you’re going to enforce it. Enforce it where it’s being made since that’s your number one risk. Now… why… okay you got a lawyer standing in front of you we generally don’t charge by the hour but sometimes we do but that hourly rate inspires people to sue; suing is probably never good for anybody in this room okay? Contracts are not meant, if they’re written properly, are not meant for you to use to sue somebody. A well-written contract should be used for negotiating leverage if there’s a problem you can point to contact and say, here is your penalty for delivering late, here’s the court I’m going to bring you to. Okay? It’s in your province okay, now when it comes to bringing those cases in China the trend is towards enforcing the IP rights because there’s this whole battle going on around Asia as to who is going to be the IP capital of Asia right? So you have Shenzhen and Hong Kong and Singapore and Taiwan all trying to enforce rights strenuously because they’re all trying to become you know the next top dog for IP rights. There are all sorts of IP trading issues going on so you can, I believe count on the courts to enforce it if you file because as Mike said China is first to file or first to register. It’s not like the U.S., in the U.S. kind of mimics the UK where it’s first to use, specifically first to file and it’s not just business people like us who get hurt if you don’t register, if you don’t file. Michael Jordan had a significant problem because he didn’t file in China. President Trump up until recently [paused] had a significant problem for years over the name Trump in China. For some reason it’s all worked out I think over the past couple of weeks…[audience laugh] not here talk politics though but it’s a significant problem he interfere at the beginning stages; if you’re not sure your products going to be successful okay, if you’re putting your heart into it, if you’re putting just this much of your income into it, you might as well get the protection because if you’re successful someone’s going to jump on it so do your protection now okay.
Copyright protection – you can file copyright in the United States, I’m not sure how to do it in China. There is a mechanism yet for it but you certainly want to file your verbiage okay, in the United States is a specific use online you don’t need to pay anybody to do it. Let me take a step back… trademarks are the symbol; it’s the Nike’s swoosh its McDonald’s M those are trademarks. Copyright. Copyright is any creative work except scent okay it could be the verbiage on a package, it’s certainly If you’re on Amazon, images are a significant issue okay and if you’re creating your detailed pages for your brand and someone takes it, takes your image and uses it to create another listing, right – that is clearly a violation. If they’re using the words from your package in their description – that’s a copyright violation. If your product is something that’s kind of generic and you’re including a newsletter in it that written material, that newsletter, that’s copyright. Copyright can even be like a dance or any one of a George Carlin’s seven dirty words, that’s – you know; you see dirty word that’s all copyright okay? Anything you create except for scent is copyright.
Okay. Trade dress – trade dress is kind of a combination of copyright and trademark that hasn’t been filed in any office okay? It’s the package shape, the color scheme. We dealt a lot with a particular humidifier that was in the shape of like a teardrop; and they made the conscious decision not to file for protection for that teardrop shaped humidifier, why? Trade dress does not expire okay? It’s a little bit harder to prove but it doesn’t expire, but trade dresses like the whole package where you look at it and you say I know exactly what this is but you choose not to file it with different strategic reasons. Okay, another way, one of the methods, you’re going to use … you’re going to use your law degree here, your Global Sources law degree to get rid of hijackers is you’re going to act on every single hijacker, okay. It doesn’t take a lot of time you can write the cease and desist, email it yourself and use the same over and over and over again okay? But you need to act on every single one.
DIY – do it do it yourself okay? So you’re monitoring your listings you see it you have one or more or fifteen or twenty hijackers what do you do to help yourself? Okay you write a cease- desist letter right and it really is just stop selling my product, stop violating my intellectual property rights okay? You want to identify so listen we were the first to use this in the US, we have filed okay, we have registered in China or wherever you think the hijackers are using some mix they can tell by the delivery time right but you’re going to write to them, “please stop selling” and you want to put some… a little bit of a threat okay? Not “I’m going to blow your head off “, you don’t need a cannon but you want to identify Amazon’s own policies that if you are infringing and I choose to report you – you can lose the ace and you’re going to lose all aces. But you know what else unless you’re a heavy hitter, your entire account can go down okay? So you inform… you know… you know…. overly threat them say “I don’t want to make a complaint against you and put your entire livelihood at issue, please stop selling my product” and that works probably in 60%, 70% of the time; now what you also want to do is, I don’t believe in asserting baseless complaints because when I’m over here, right, representing these two gentlemen who are selling someone else’s product, no offense okay, I look at the complaint say “oh this is a baseless complaint they just bought it off the back of a truck or at the back door of the factory” and I get rid of those complaints and knock them out of the box everyday right? So you want to look at your product see well what IP rights do I actually have, right. What are they actually violated? Did they create a listing using my images, is their packaging using my verbiage, are they delivering a newsletter or an add-on to that package that is mine? So you actually have some teeth to your complaint. It’s also a violation of Amazon policy to assert baseless complaints okay? Now we use that when I represent guys like… like these two okay, where I say “you know your complaint is baseless and if you don’t withdraw it you know we don’t want to make a complaint against your account, have you suspended, you also and I’ll show you how to do is to file a complaint on Amazon. If your cease and desist is ineffective and bless you if your cease and desist is ineffective okay you can go ahead and file the complaint yourself you don’t have to hire an IP firm to do it it’s easy to form on Amazon you may want to like call and get some free advice the secondary steps because sometimes you’re in sort of a feel- like an endless cycle when it comes to Amazon making your complaints but you can certainly file that complaint yourself.
Okay, I don’t really stick too much to a script so some of the stuff I’ve covered already. You want to give the hijacker in your cease and desist the opportunity to amicably get off your listing, okay. Now sometimes you’ll have someone who’s on your listing and it could be a small seller, it could be a major seller and they’ve got a bunch of inventory you know; they’ve invested you know their nest egg in this product; they’ve got like you know five thousand units left but you want to give them the opportunity; I believe okay, we’re all in business to make money and to do business so you can work something, say “ I’ll tell you what you can keep violating my right, hope it’s okay you don’t seem like a shy guy; I don’t want you selling my product but I understand you have 5,000 units left okay; let’s make a deal, we want a license agreement, we want 25% of the profits, we know what it costs us so we know what it cost you then we’ll let you sell out and then you stay away.” We take… we never make the complaint, we take back our complaint okay and maybe you’re giving up this much your profit but everyone’s staying in business and also if you handle it in a courteous manner right, you have to worry about this seller making bogus complaints or his brother or his cousin or his mom right, giving you bad feedback right, because you put them out of work or you put his staff… they had a layoff… people you know… a lot of stuff that people doing and they don’t realize has real-world effects right? if it’s…. if Christmas is approaching and he’s taking every penny and reinvested it into his store into a product and you have the ability to knock him out he may have to lay off 20 people and you know as an attorney you know not as not as tacky as the second divorce half-off okay but if, if you have him dead to rights, right but you have a single mom with a disabled child who’s now losing her job right I’m going to use that and I’m going to write to Samsung and say hey you know what you’re right he did something wrong but I don’t think it’s a your brand’s interest for him to lay off this single mom with a disabled child so let’s work something out so I think that’s… that’s the way to go in your cease-and-desist letters I think you should certainly provide a deadline and stick with it okay because it is a small community of sellers you know it you know there’s 1.8 you know 3 P sellers on Amazon right now I mean just tremendous numbers but people still talk, you know in the US and the UK there are a tremendous number of Facebook groups where they… they chat back and forth right when it comes to China instead of being you know 30 or 40 or 50 there’s three or four thousand people on each of these WeChat groups so it certainly pays when you put a deadline and then you stick with it; and if either he doesn’t work it out with you or he doesn’t stop selling, okay then you cut his legs off okay? Now, also inform whoever you’re making the plaintiff in your cease-and-desist of their risks as well. In business I believe, everything is leverage; sometimes you have more, sometimes you have less. People in this room are advanced sellers you know… negotiating you know, generally it’s not wise long term, to go in with cannons blaring but you know your leverages and I think that when you inform someone of their risks and why it’s in their interest to get off your listing, it helps move things along in an amicable fashion. I guess as a lawyer sometimes may sense of amicably may be a bit… a bit warped.
Okay, now recognizing your IP rights, images clearly okay verbiage you know the context of your packaging, your description, your instructions on how to use a product; all that writing if you wrote it you own it okay? Now other things that… that you may not know about is like licenses okay? So people my age in the room, when we bought software and you went to the… when you went to the… you know wherever you bought your new software your latest version of WordPerfect or… or Word and you thought you were buying that disc? You weren’t, okay not even when you bought the three and a half floppy okay, you’re buying a license to use that software okay and in some of your products you may want to build a license type issue into it because licenses are treated entirely different than products you can move around okay. Warranties, some warranties are really, really great to create intellectual property rights or intellectual property-liked rights okay, money-back guarantee! Okay, this gentleman can offer with his brand, a money-back guarantee okay. Who cares right, because this in general sound the same thing so you know I’ll give you double your money back, right where’s the difference consumer gets no difference in that type of warranty but if you build other types of warranties into your products they do create a different delivery to the consumer. We’ve gone against and nobody wins a 100% at a time, okay? Nobody you guaranteed at least two people in this room that thought there was a product that they were just going to kill it on and it didn’t work out that great, okay, so we lost the case. Okay you might not believe me, I lost the case, right and it was against Gustave Cutlery and there are these pretty high-end knives and we lost on the warranty issues that like a money-back guarantee has a big deal my client will give them twice their money back right and this argument has been successful with Amazon but what they did is they actually offered to repair the knives like I never heard of someone repairing a knife okay but I guess some knives are so good that you’ll repair them but Gustave built that into their product so if you buy that knife from someone who’s not an authorized Gustave Cutlery seller they won’t fix your knives; whether I’m going to use it or not who cares right so you can build certain warranties into your products; and action nobody else can mimic and there are some other things you can do as you become more advanced okay? Really… really great client, he had bought his Amazon business – yes, you can buy and sell; you just can’t let Amazon know about it okay? He bought it from a gentleman who had a son who was autistic and he had created a charity, you know, for children with autism so when he bought the business, part of the negotiations where he’s going to keep maintaining and it was like 2 .5% of the sales would go to the charity right, which you could do too, right? You can give money away just like this guy but what you can’t do is you can match your 2.5% with his 2.5%, lump it together and deliver to the charity, right? Now, is that really an intellectual property right? Not really okay but it works okay and what’s the goal? The goal is not necessarily to pass, you know, the bar exam; your goal is to get rid of the hijackers so you find something with your product that you can deliver to the customer that nobody else can copy okay like Gustave’s factory right; like this charity; like a license; like your newsletter; if you’re selling health products like an exercise regimen or quarterly something okay, something extra that someone else cannot mimic without violating your IP rights.
Okay I told you was going to show you how you can make these complaints yourself so you don’t have to pay my firm’s very reasonable fees okay. You just run in Google Amazon intellectual property complaint, right? And here it is, I know it’s not it’s not too sharp right, here’s the top of the page about this page you know in Amazon for uh for all the flaws and the obstacles and the erratic… the erratic behavior of Amazon, there also just a remarkable company by giving such tremendous opportunity you know to millions of us okay, and they create this great, easy-way-of-making-a-complaint-against-somebody – piece of cake! You go here, you read it, you fill out this form, you list the Amazon’s rights; you check a couple of boxes I own the rights, you fill in the description and you click; and that’s it – you’ve made your complaint! Now what’s great about Amazon is that they give their… they give their employees all over the world the freedom to do their job as they deem fit; in many cases okay? And what that does is, that sparks a lot of ingenuity okay? And creativity which is one of… they come up with all these fantastic ideas, some which help us, some which don’t, okay? But it also sparks very, very erratic responses so you can go online, you can click to this page, you can fill out this form, you could put down all 15 of the hijackers that are on your listing and you hit click, and that day they could be gone. Just like that okay? So try it yourself. Before you go, when you leave, when you… I like to say that we, after I speak and a lot of times I’m speaking to sellers who are not as advanced as most of the people in this room but I like them to feel empowered; like they learn something right and that they could do more on their own just like every other entrepreneur; that’s why we’re entrepreneurs, we like to do things for ourselves we don’t mind working 60, 70 hours a week okay. We want the independence and the control; you can do this yourself and you’ll be successful a significant portion of the time. Now, if you fill this out and you’re not successful what’s probably going to happen it’s just like…like a plan of action situation where you get which seems like a robotic email asking for more information okay, and you answer the questions where’s the trade mark? Here… here’s my trade block application and by the way here’s my right of approval also right here’s the design that I sent to the factory in China or India or Thailand or Vietnam okay and you keep showing them why you own these rights and they should knock those other people off okay if you look at the lead time so amazon I often will want a testify to show that they’re not delivering to the consumer what you are that creates a problem because if it’s a four to six week lag time on that delivery right you’re losing out those sales and those profits okay for that period of time but you just go to this form you follow the directions.
Okay. I highly suggest that you don’t file baseless complaints okay, and this is sort of if you had like you know Amazon selling, you know, 101, this is like the second level course okay, so anyone know MAP pricing is? Okay, who thinks MAP pricing is enforceable? Good! MAP pricing is nonsense unless you’re the person who signed that contract back in 2007 or so; United State Supreme Court said that basically is not a life-saving device that… that our public needs… we’re not going to enforce it so don’t file a complaint with Amazon saying they’re violating MAP because it doesn’t exist for the most part of United States. Unauthorized resellers, okay, in the United States for the most part there’s something called a first sale doctrine – it means I can buy, “I keep on holding this like a microphone”, you can buy the pointer from here and as long as you sell it in the same condition you can sell it here, it’s not an IP violation okay? In the vast majority of cases so don’t argue it because it’s nonsense most of the times. If you have a hijacker complaint it’s because you have holes in your distribution chain, you have lost control. Most people who wear glasses in this room right have at some point had glasses that were owned by Luxottica right? They own like 95% or 90% of the eyeglasses that are out there; Luxottica, who I’m not a big fan of because they make a lot of baseless complaints against my clients. If they know that they can move a million units through their distribution chain, they make two million okay, because they know they have to go through back channels and back doors and they’re going to sell to a distributor who can’t make a living. Let them sell to someone whose then sell it on Amazon and they know all this but periodically, they’ll do a sweep and they’ll knock people off, okay. So if it’s a hole in your distribution chain I would rein yourselves back because your goal is not necessarily to get rid of the hijackers today. Your goal is to get the hijackers off and keep them off okay? So I wouldn’t argue this unauthorized seller also owning a listing okay? Have people this room created their own detail page? Okay, when you… when you created that page; when you clicked, you upload those images; you waive all your intellectual property rights to the images in the verbiage okay? So you don’t own anything, okay you don’t own that detail page it’s a page in somebody else’s catalog and you don’t want to open yourselves up to getting them off; to getting yourselves knocked off okay? So the things you shouldn’t argue okay?
No one likes the wizard? Thank you! Bald guys in the room don’t want to recognize that, okay? Now this is sort of things that… that we do and I’m happy to share with you so you can help yourselves and feel a bit empowered. If you’re advanced till you feel like you’ve walked out and you learn something, okay? You have the ability to take things that are not intellectual property rights and tournament electoral property rights, at least as far as the Amazon platform is concerned and just like those guys surrounding the plane right? We’re going to take out the hijackers, you can do it too okay, so your contract language okay? Now I just said… I just said five minutes ago that MAP pricing is not an IP issue – it’s not enforceable. United States Supreme Court, okay, Justice Scalia was the deciding vote in this, okay? MAP pricing’s nothing but we’ve seen success where if it’s on your documents creating the product, it’s on your contracts, with your distribution network. It’s on the receipts, it’s on the boxes, you’re sticking this thing on everything you can wherever those products are going through the food chain right; that… your MAP pricing, it is okay, I am taking my bald wizard and transmutating MAP pricing into an IP right, right and it works right so add that to your documentation right, is it going to work forever I don’t know; I know it works, now you can use that as just another tool in your arsenal to get hijackers off your listing, put it in if it’s not in today; add it tomorrow okay; you’re flying home tomorrow, add it after the weekend okay; add what you want into the contract language, why? Now, even though these two bad guys; these two hijackers right, are selling your product maybe never even saw that document right but you want to just shoot those hijackers off your plane, you submit that to Amazon and you say whoa! Whoa! this is by agreement okay; that anybody who comes into contact with my product is agreeing that MAP pricing is an intellectual property right and the people that are reading these things we’re mostly the people who are reading this stuff and evaluating whether they’re going to knock off a hijacker or not; located in India Ireland or Costa Rica, okay they look at it say smells like a duck, it walks like a duck, must be a duck – must be an IP right; knock these guys out okay, you can do that with MAP pricing you can do it with other aspects to your product that they’re guaranteeing; no such-and-such the repair facilities, license, the newsletter, that kind of stuff; they’re agreeing just by being in your distribution chain whether you want them there or not – that, that is now an intellectual property right. I talked about donating and matching portions of sales which I thought was absolutely brilliant, I don’t believe that I need to be the smartest guy you know in the room and I’m generally not but I do need to sit on the shoulders of the guys who are, okay, and Amazon is all about riding the trends okay, so if this is working now, do it! If it starts to be a little ineffective later on, then you pivot! Just like you don’t marry a product, you’re marrying your business. We don’t marry particular product so this works now, okay? Now, another thing that’s been working for a while is… is add-ons to your product, okay? Maybe you’re selling you know, this bottle of water right? But it’s not just this generic water, right? Boss comes this cool glass, right? And the two together right and I don’t know why it works like I don’t get Amazon’s rationale because it’s a generic class and it’s generic h2o, but it works ! This worked tremendously well with people who are selling Raspberry Pi computers right? Because the Raspberry Pi computer is this really cheap computer but you kind of buy it in parts and it’s used in kits; and children use it in schools to learn basic programming but a lot of cells they were doing is okay. We’re going to sell the Raspberry Pi but with this particular card and this particular switch and all these different add-ons and now if it came unique and even if other sellers were matching with the same parts and same cards Amazon was using; was recognizing this as a mechanism for getting rid of hijackers and we did it successfully on at oh, two or three dozen different cases so it’s something you can do to get rid of hijackers, by simply adding something to your product. Another thing you could do is sort of stay ahead of the hijackers, okay? The 2017 Watson’s water has it’s really cool right but it’s selling so well that you have 15 hijackers selling it with the green cap so make the cap loop right or add Watson’s to it or add a spigot on the top okay; add your logo to the top right because now their products are not the same as yours right? You’re adding something that’s your IP your trademark to it right and ultimately you know Amazon is always consumer! Consumer! Consumer! Customers always, right? Customer’s always right, okay. Well, now the customer is not getting from the hijackers what they’re getting from you because you’ve changed it a bit okay and if you created the detail page you control it okay? So it’s another way you can, you can set yourself up to get rid of hijackers.
Okay. Some of the things you can use, this thing leverage I talked to you about is the risk of suspensions, okay? You’re all at risk of suspension okay? Everyone in this room doesn’t matter what you’re doing; ten thousand a month; you doing quarter billion dollars a year, the one thing I’ve learned from speaking these events is that most Amazon sellers live in fear of that email, okay? So do the hijackers, okay? Use it, okay? Another uses of leverage, apart from your Global Sources Law School 101, is that there was a case Apple vs Samsung, okay and this is a big battle right? With two giant corporations; each one has more money than many countries on the planet, right? And Apple said “Samsung, you sold so many of the galaxy whatever number it was using our technology, was the rounded corners like the iPhone, it was the icons look something similar to it, it was the gyroscopes inside of it right ?” and Samson said “no, no, no, no, no! they didn’t buy it because of that; they bought of course because of our great battery; because it’s bigger than yours or it’s faster than yours”, and the court said you can’t, you can’t figure out why the consumer bought the Samsung versus the Apple and Mr. Samsung you now have to give back 100% of your profits from day one, okay? From day one, the first time you sold a product that may have violated your intellectual property rights; use that as leverage and you can write to him say “hey listen, I don’t know if you know this, I’m not a lawyer but if I’m right and you’re wrong, you owe me a 100% of your profits and if it was willful, lawyers call it treble damages it’s treble damages plus Attorney’s fees, right? “ Now, not all lawyers charge reasonable rates; the attorney’s fees can be very substantial but these… these other things, it uses leverage because most sellers simply want the hijackers off; you don’t need a cannon, need like… ah…like a sniper rifle okay? These are the things… hey listen, I understand you need to sell out your inventory but if you’re not gone by such and such a date okay, this is my leverage against you okay, and negotiate them off. If you choose to do so and generally it’s not really wise to get into litigation, but you can order to show cause… are there any other lawyers in the room other than me? Yeah, the guy from New York of course, right? So, in order to show cause exist in all the federal courts and in most state courts, what it says is you go to court by yourself like most times you sue somebody you have to say here’s the notice, I’m suing you for A B C and D and the court won’t do anything until you prove something in order to show cause, turns that on its head and it says dear court order this now right? To protect me and if you can convince a court to do that right, if you have to go that far or you just want to use it as leverage, the court can say you’re right okay we’re going to give Amazon an order freezing their account, freezing their money and by the way if you’re using PayPal or credit card processing companies or Amazon’s releasing your money to world first or currency direct right or Payoneer or any of these companies you order them freeze, they hold all the money don’t release it you keep it right and now that hijacker is either it’s significant threat or he’s really sucking wind all right because he’s at risk and again using his leverage he’s at risk of being suspended he’s at risk of having his money held by Amazon he’s at risk of his Payoneer currency direct a world-first account, being frozen right, his inventory is also going to be stuck right and this is really good leverage right so if you’re right you can use this in as… as gentlemanly fashion as you can to get rid of these hijackers. Also if anyone even emails me I will provide you with similar cases where you can write a good letter… “Dear hijacker, I understand that you also have a mortgage and a car payment and maybe salaries and payroll but you’re infringing upon my rights, I would like you to stop selling and get off my listing by such and such a date if you do not get that such and such a date, I’m going to seek relief as in this case they attached where they froze your account, froze your products, froze your money, froze your payroll, okay? Froze your world-first, okay? Please contact me so we can amicably resolve this issue”
Okay, I want to check my time. I’m not checking for messages or texts or notes from my wife. Try and check my timing I hope I’ve given somebody of the less experienced sellers the information that as you gear up and as you ramp up, what you should be doing either yesterday or tomorrow for the more intermediate sellers a little more information and; I hope to the advance sellers, to the big guys in the room, the big men and women in the room, I hope I’ve also given you some information and I’ve left, sometimes there, any questions I am NOT billing for the time at all;
Yes, trade dress doesn’t expire. If it’s yours, if you’ve always been green with the green, and, yellow droplets and this exact design, it exists… it’s endless. On the other, it’s a bit more difficult to prove, like, if I’m a lawyer and I’m actually involved in litigation, I prefer to have the trademark filed in the USPTO and also WIPO protection because it’s something you know, date-stamped by the government in order. I’m sorry did I hear it right the question? Alright, the question was “why would someone go with trade dress more or less?” or “why would they not file and rely upon trade dress? “ Couple of reasons one who doesn’t expire could be a strategic decision. More often than not, has they were starting out didn’t spend the extra money or didn’t have the money. They didn’t know it’s going to work. Made you think that this is going to be a great product, right? They don’t want to put the extra money into it, the extra effort. First is US, UK first to use. Let me take a step back, forgot something. Are there any seller here selling in the UK? Okay, permission to sell a product in the UK is generally… not… I hope I to be a solicitor in about a year so; permission to sell is often a part of the copyright in the UK not in the US. Yes?
But I would say what the majority of sellers ask the question was, if there’s a model and like a black t-shirt a fairly generic product and someone else starts to use it how do you prove it? Okay, how do you check to see if someone else is using the image; if someone else is using it? How do you prove that you had it first, okay? One even, almost you can file, most people don’t. They should but they don’t; you would have to, first, you would just claim it on Amazon and you click a box, that everything is saying is true under penalty of perjury, I mean even though there’s no Amazon police okay? They have you clicked this thing that’s under penalty of perjury, you know? It’s nothing enforceable in Amazon okay? When it comes to the time to prove it, you would look back on your records you know? More modern pictures you can actually just geo stamps that sort of thing involved right? Well, you may have an invoice or just your testimony or an affidavit from the model if it should go that far; that’s how you going to establish it, also you can generally show when you uploaded it to wherever you used it that becomes sort of you have certain evidence and sometimes, that he said/she said but again the goal is not like to win a battle in court your goal is get rid of the hijacker; so if it really is yours and it predates their use of it you’re using that as one bullet you know in your rifle to get those hijackers off your airplane okay? Jump well so what Amazon would ask for, Amazon doesn’t really ask for anything specific okay? What they generally do is if these vague emails a lot of the emails say we’re not going to tell you why we make our decisions and blah…blah…blah but, you’ve data what the support is for your contention or give us more information like you file the forms; like here I think it’s either that the.. the big one it might be a little bit further down the screen right and you would put a description there okay about why and when and how and then you’ll get an email back from Amazon if they don’t knock them off saying give us more information about when you created these images and you just need to put in sentence form paragraph form on you know October 1st of 2014 I went out and I hired this beautiful model and I gave her a size medium black t-shirt and we shot the pictures on the Santa Monica Pier in California and I used professional photographer and that’s how you would substantiate it but again since Amazon doesn’t necessarily give you exactly what they’re looking for you can give them what you have.
[Participant]: “Thanks! My question is this, if you have a private label and you send things into FBA and somehow they lose things and they lose the whole shipment but then someone buys that shipment and starts selling it, how do you stop that because they saying “I bought it from Amazon, go f yourself!”
Well, there’s a lot of couple of different things, everyone heard that part actually? ”go f… go f yourself” whatever. First of all I certainly believe that practically nothing gets lost to the FBA; what happens… is you deliver the units and sometimes it’s our fault we don’t have your stickers right? As in packaging is wrong, and the weight is off, right? But if they can’t find it, they keep it; they don’t throw it out, right. What they do to other stuff, they say, they’re going to destroy your products, they don’t, they can sell it to what’s it called a whoop, right? Because there is liquidation, they hate liquidation, in that case it’s not necessarily an IP issue but you’re not supposed to buy and sell in Amazon; you see that, huh? That’s great! You bought my stuff, it’s my stuff, there’s no way you got it through, right? It’s not as if because it’s mine, but you bought it from Amazon! You’re reselling it where you bought it, from a liquidator. Amazon is not into that these days, in fact I don’t know if you guys have noticed; I don’t know, most people in this formatting of private labels but the big Liquidators are changing their names right, because Amazon sellers can’t have invoices that say 888 liquidator, right? Because Amazon doesn’t take those receipts, so genius to change our name, now we’re distributor, 888 distributor, that’s how I would handle that but again it’s so Amazon; for all the greatness that it provides and all the opportunity they provide is very erratic, right? So I would think that would be a winning argument I’d probably say in 75% of cases it would be, no 25% because you had different human beings sitting in hydro bag who decided I am different.
Recouping inventory is an art, yes. Amazon, we have seen it’s not written policies, just from you know doing this, you know six or seven days a week they get a lot of products and people don’t know how they got them; they certainly have lost products also and you’re out 200 units, and they’ve got 200 units right – Mazel Tov! What do you do about it right? Sometimes it may… it may pay just to lay low like, sometimes you have to, you know, lay you get screwed a little bit. The long term but you don’t, to pick a fight; you don’t know the person on the other side is going to do. A real in-depth evaluation finds something wrong with your account, right? On the other hand you may say, you know what screw that, you haven’t using bad language now, screw that right? Screw that, okay? I make them a lot of money I want my children’s units back generally what they will do specially if you’re involved in commingled inventory or inventory that’s available, you know, from other sellers or from Amazon itself it’ll just moving from this column to that column and all of a sudden he has a 2000 units back, miraculously! Okay, this is more like a suspension conversation I’m happy to have but if any of you are not opting out of commingling, you are out of your mind, okay? Because you’re selling like you know, this really high-quality glass and you have it delivered to an FBA warehouse in California right? “And I’ll switch, I’ll switch”, and this gentleman sound like a piece of crap right? But he is in New York and you get a sale in New York; they deliver this piece of crap because you allowed commingling and a customer complaint at his glass a piece of garbage; you’re the one getting that ding on your account. I haven’t seen any suspensions from it. I wouldn’t say it doesn’t exist because they’re very sad they save a lot of money but I haven’t seen anyone get a suspension when they’ve opted out of commending for someone else’s product and there’s people on my team that know how to do; you can actually track where the product came from. We did it with an Apple product where turned out Apple Apple’s relentless. I would not be involved in Apple products at all if I was a seller, not a single thing; it’s not worth it. Apple goes… goes after with a vengeance and we had, we showed Apple’s lawyer, his name is Rob… Rob… Rob Potter that kills Patrick Townsend in New York and we did the whole research and we tracked it and said “listen the phone you’re complaining about wasn’t our clients’ phone; it actually belonged to amazon, right?” He said hey no problem CJ, you know how… how’s the wife? how’s the kids? I’ll get back in a couple of days gets back hey man sorry Apple said no won’t withdraw they complain like what do you mean the one state they said no it’s not our phone that was my marching orders. So in that case since it wasn’t retracted they reinstated without Apple’s consent.
[Participant]: “Hi you said that you can protect the copy of your listing as well like if an AR seller creates a new listing but they put the same copy of yours?”
Yes, they taking your copy right, they’re cutting and pasting or even if it’s so similar that would confuse a consumer. They violate your copyright and you can go to this form right? And you would actually put in tears our verbiage, right it’s a violation, knock them down on Amazon. Okay, there’s a Digital Millennium Copyright Act right? And what it did and it’s kind of archaic right, it protects Amazon, protects TV, protects the platform where it basically says that if, if this rights owner who’s a really good business person, he’s an upstanding citizen right? And he makes a complaint okay, against this gentleman all amazon has to do is throw up their hands and say you’re off until you work it out that’s why that email says here’s the rights owners email work it out with him we’re not going to let you sell; we don’t want a liability ourselves but work it out that’s you only the first step but that be clearly a copyright violation clearly and you would not get there. Get them knocked-off at least that product right? Again I would always try and work it out first I’m, I’m probably the only trial lawyer in America who’s telling you to stay out of court okay? Stay out of court you sound… listen first this cease-and-desist here’s ours, here’s yours. If you take it off within seven days or you contact me, we can work something out. I won’t make a complaint and put your livelihood at risk but that would be clearly a violation.
[Participant] “Back here, hey there so you mentioned about MAP pricing it’s not enforceable in a court of law at all but you kind of suggested if you give the impression to Amazon that you have MAP pricing they might enforce it . Did I get that correct?”
Yes okay, yes okay it is not unless you sign that map contract it cannot generally be enforced against you okay, now have you signed it then its contract law and it can be enforced in so if you didn’t sign it if you got it someplace else in the holes of the distribution chain it’s not enforceable but you’re not in court right you’re sitting there with your rifle trying to get rid of hijackers and this works right and I’ve never seen Amazon’s legal department or in my conversations with the lawyers with them getting involved in this type of thing it’s like that the right hand doesn’t know what the left hand is doing or even cares. The lawyers are not involved in these issues as far as I’m aware so it does by putting it on your, on your invoice does it make it IP right? Of course not! Right, its transmutation, right; it’s my little wizard here right? This guy really doesn’t exist okay, it’s BS but it works “So like what would you put it on? Like, what a just for I bet it’d take like putting it on a key to a Chinese supplier and I’ve known, has absolutely no relation to the hijacker?” Yes! Yeah. Because what are you doing with it right, we all know its transmutations – made-up word, right? But when you trying to give me your hijack and you’re attaching the attachment after attachment you would say, listen here’s an auto purchase order and violate here’s on every documented distributor; and here it’s on all these agreements and you know here’s ten pages stuff right and it’s ten pages it must be right, right? Then, what’s my job… my job is to be persuasive and to get you more profitable by getting rid of your hijackers so do I agree that intellectual property no right this guy doesn’t exist but it’s working right now, so you could be right; you could be right and make more money, you could choose between the two I don’t think that, by adding it, I don’t think you’re doing anything morally wrong you know? I do think it’s morally wrong to assert some complaints that are just entirely baseless but I guess one draws their own lines.
Awesome! Thank you! One more, yeah one more question.
[Participant]: “ You mentioned earlier when you upload all your pictures and everything to Amazon, basically you’re giving up all your IP rights so someone else is selling your ice and because they get it through some other big distribution channel, that you might sell to, is there any way around it besides this or…”
Yeah… yeah the only thing you can argue is that those are my pictures ,that’s my verbiage, that’s my detail page and… “and the Amazon even though Amazon says that you know, they own all the IP rights, it doesn’t matter or….” Yes, because when you upload them you’re waving them, you know if it’s the entire history of man okay and it going through the future right? You’re waving as far as that line so don’t argue it because if you argue that, though they’re selling on our images right, all…all someone’s going to do another side it’s a cut-and-paste Amazon they waived if they don’t know those images anymore screw them so you argue something else. I mean you…you don’t, you’re not purposely going to aim a gun at a hijacker and shoot blanks right so you argue something else, like…like a license, some newsletter, an add-on that you have a real good enforceable warranty; just something else, you cannot argue that a hijacker should come off because they’re on your listing and they’re using your image. You put your image up there, what’s also interesting the images, right, violating intellectual property law is what is usually called like a strict liability like you may not know you’re stealing someone’s image but you did and you’re responsible for it right? But it is specific to the person that did the act right? So if this gentleman here creates a detail page with your images, he violated your IP rights, right? But this guy over here starts selling on his listing right? He didn’t do anything wrong, he’s got one that uploaded the images right whether he did it on purpose or didn’t realize he’s still responsible, this gentleman is not, that’s one of the kind – of weird kind of gaps in the rules. There, so just to clarify images on the same listing not an issue but images that are taken, used on different listing isn’t. If you took someone else’s image and put it up on your listing right, that’s a copy. If it’s for their product they own that image but he’d be okay jumping on it yes to get someone else to create the listing… must be beautiful kids, count your blessings. What do they say? We would get you started, this, you always know who your mother is okay? I’m pretty sure we’re out of the scope of… back…back on
[Participant]: “I have a question regarding add-ons if a seller has a product and they have like four different add-ons and a competitor on another listing does the exact same thing is that baseless or was that violating IP?”
It works, raspberry PI’s were a great example because you’d have someone who matched it with certain cards and raspberry PI’s have all these kind of crazy add-ons to build your computer and to me it would be no violation I wouldn’t mind having either side of that fight but it worked.
[Participant]: “I’ve seen many of my images have ended up in Alibaba so is there something that can be done?”
You can but I think you would want to make a real big business decision, really counter and say okay, risk versus reward right, could you get it taken care of? Yes, the Chinese courts are enforcing IP rights I’m not so sure how it works with images in China but what’s…what’s the game you know? If the litigation is going to cost you, the efforts going to cost, you know five, ten thousand dollars knows a reasonable rates right? Is it worth it to you and why? I don’t…that I wouldn’t…you’d have to make…
“I was thinking more like teachers contact Alibaba with some documentation or maybe register the image in China and then contact Alibaba with that information. “
Like, yeah I don’t know… I don’t… I don’t deal with it and I believe when it comes to this sort of… we’re all in a fairly immature industry okay if anyone says they actually know exactly what’s going to happen, they’re full of crap but it sounds like they should take it off but I don’t know what would happen.
[Participant]: “What are your thoughts on brand gating as a way to stop hijackers?” I think brand what…what do I think of brand gating? Is a way of stopping hijackers when it came out right? Amazon had the… we’re going to be transparent, we’re going to treat all sellers the same big and small, Nike and private label right? And my experiences they have not done that at all okay? Like not zero but pretty close to zero where your smaller private labels are just not getting it right? Initially it was touted as you apply you have the trademark, you have the electoral property rights, little brand gate to protect the consumer right? But then you aren’t getting it. Then there was this…this…this transmutation that’s a no not only you have to have the intellectual property rights and a history of selling but you have to already have an existing problem with hijacker’s right? And there are many applications and my office isn’t doing it but I know a lawyer I know another in Kentucky who is doing it and they change the rules and even then they’re not granting it to the small brands so I think theoretically if they deployed it in a more efficient manner right and gave the smaller brands the same benefits as the larger ones. It would be great because it doesn’t look once you have that you can’t sell without you know without the almighty’s opinion; with that they’re okay so I think it’d be great if it ever gets online right, now not seeing it. Any more questions for CJ?
[Participant]: “What about we have a brand and someone’s probably put our brand name and the keywords on the back end so it pops up right in the mix and I looked through the violation…” okay violation. “Perfect is there nah cause and yeah in fact we…” we see that a lot, we’re successful, I don’t think it’s really an IP violation but again who cares right? It works to knock them off, I didn’t know that. Just go down to a forum right? There, yep, right there, yeah, well you know where it was.
Yeah…yeah,,, yes, well that’s a safe bet and there are people who can do it. I don’t…I don’t know how? We have a couple of different analysts but I know it can be done and you can actually, I don’t know how they do it but you can see it but if it’s coming up as you run your brand it’s in their back-end.
[Participant:] “Can you touch again on using your wizard and transmutation add-on strategy with warranties to prevent other people from hijacking your IP?”
Ok, if you’re taking your product and adding certain things to it right? So yours is unique like I use the Raspberry Pi you know the Raspberry Pi? Ok using the Raspberry Pi computer you’re adding certain cards a video card to this card; a sound card right to it Amazon has recognized it as something that only you are delivering ok and then recognize that is almost like an intellectual property right and you can use that effectively to knock off hijackers even if they’re selling you know like the same video card or similar video card with their Raspberry Pi. When it comes to a warranty, right, the warranties often say you have these benefits of buying from an authorized reseller right? And I said a few moments ago to authorized resellers are nothing right? You know and yet it is bupkis right but if your warranty says something that nobody else can mimic like woo stop in there repair facility okay? Or membership in a club or a license or a newsletter or something that only that you can deliver it is something you can use because the customer is not getting the same thing when they buy it from somebody else; because woo stop won’t fix their knives so that’s…that’s, the sort of add-ons and the good warranties versus the very weak type of warranty.
Sure the charity thing wasn’t even my idea okay had a client and you know we talk to clients okay? There’s no way that anybody can really help you, address your business without your involvement okay? If you think you go to any law firm you don’t, one of the $500 ones that Mike talked about right? Didn’t have no one, no one know your business as well as you do ever so as we’re talking they don’t by the way you know mention this charity now I have a favorite charity that you know that I that I touted certain events it’s called the Ty Lewis Campbell foundation okay? Ty Lewis Campbell Foundation, if you want to make a donation. Amazon smiles okay? It’s a great charity, I’m touting it now. I’ll answer your question. Very good friend of mine lost a child to brain cancer and they turn tragedy into this this great foundation. They raise a lot of money; they donate it to find a cure for pediatric cancer.
I forgot your question, oh they had the donation yes so this client bought the business from a guy who had a disabled son and had his had a he’d donate money said, “okay I’ll buy the business and part of the deal was he would do this and he kept donating it was like two and a half percent then he also would match It” right? But he would wait, he would lump it all together and deliver his own piles of money nobody else could deliver his piles of money and this was something that Amazon bought to not the hijackers off I thought it was genius. We argued it you know it was his idea we wrote it up and hijackers were gone okay I don’t even know if it was in the listing; be honest with you I don’t remember it was in the listing or not you can be there are also issues there are certain rules about what you can use as promotional items but yes it does change the game to game changer a bit so as long as not violating other rules that does do an add-on that only you can deliver you going be careful. I don’t know their promotion alert. I know I recognize the issues there, yes. Listen, the reason why it works is because the guy who’s getting that email right? He or she is sitting at his desk, he goes “oh yeah that’s a good reason to get rid of the hijacker” think that’s it that’s your goal right like I’m not here to argue. Morality right now I’m here to teach you how to get rid of hijackers this works anything else. No, okay that was quite a few so.
Thank you, CJ, very much