Amazon settles lawsuit against social media influencers for promoting counterfeit products
In the only major development of the case she filed against two influencers and nearly a dozen third-party sellers in an alleged scheme to peddle counterfeits under the radar of her more anti-counterfeiting controls in addition to robust, Amazon revealed that the parties have reached a settlement. The exact terms of the agreement between Amazon and the defendants are confidential, but include a ban on influencers Kelly Fitzpatrick and Sabrina Kelly-Krejci from “marketing, advertising, linking to, promoting or selling products on Amazon” , per CNBC, and As for unspecified pecuniary damages paid by defendants, Amazon will donate the amount to various nonprofits, including an anti-counterfeiting initiative by the International Trademark Association.
The recently announced settlement in the false appellation of origin and violation of Washington’s consumer protection law that Amazon filed in November 2020 comes as Amazon seeks to crack down on the sale of counterfeits on its platform by through a series of lawsuits, including those she filed in collaboration with brands ranging from Italian fashion label Valentino and beauty company KF Beauty to cooler maker Yeti. After years of seemingly ineffective enforcement of its large third-party market, especially after its 2014 decision to increase revenue by allowing China-based entities to sell directly to its members in the West, a move that increased its sales from 20% in a single year and pushed its total revenue to surpass the $ 100 billion mark for the first time, Amazon implemented an apparent mandate to clean up its site of third-party sellers in light of the striking influx of counterfeit and otherwise counterfeit products.
One of the most striking indicators of this surge came in 2019 when the Seattle-based e-commerce giant mentioned – for the first time – in its annual 10-K file one of the elephants on its platform: counterfeits. In a single line in the “risk factors” section of the annual report it files with the United States Securities and Exchange Commission, the company owned by Jeff Bezos said, “We might not be able to prevent sellers in our stores or through other stores from selling illegal, counterfeit, pirated or stolen goods, selling goods illegally or unethically, violating the property rights of others, or violating our policies of any way either.
The admission of risks linked to counterfeiting has been accompanied by an increase (but still relatively small) number of trademark infringement lawsuits initiated by Amazon, such as the current one. While Amazon is in fact seeking legal and fair remedies in these often headline-grabbing cases, and although it aims to reduce the sale (at least some) of counterfeits on its site in the process, It’s not hard to see that the lawsuits have another purpose as well: they help Amazon publicize its efforts to rid its site of counterfeits (despite the relative ease with which consumers can still find and purchase counterfeit products on the Internet. market, such as these “Jacquemus” bags, on the Amazon marketplace).
You don’t have to look any further than the language in any of the complaints filed by Amazon to see what appears be a public relations angle in play. There is no dearth of language in publicly available complaints in these cases, for example, which involves Amazon outlining the extent of its anti-counterfeiting efforts, often with specific details, and with eye-catching statistics on the extent – and success – of its efforts. In the case it filed against Fitzpatrick and Kelly-Krejci, for example, Amazon claims that “every week [it] monitors more than 45 million comments it receives from customers, rights holders, regulators and sales partners, “noting that when it” identifies issues based on those comments, it takes action to address them. remedy, we too[ing] this intelligence to improve its proactive preventive controls.
In a subsequent section, Amazon states that “over 350,000 brands are listed in the Trademark Registry,” an initiative that provides brands with “a powerful violation reporting tool that enables brands to accurately track and report. potentially infringing products using state of the art image search technology. The result? “These brands find and report 99% fewer suspected infringements since they joined the trademark registry. ”
As TFL has claimed in the past, Amazon’s initiatives to reduce the saturation of its market with fakes – and the pressure to get good press in the process – are likely driven by the giant’s ambitions. retail in clothing and luxury space, which require a certain trust on the part of brands and consumers for these initiatives to be successful. Look no further than Alibaba and its own public relations overhaul for example. (It should be noted, as we have done here, that in addition to its resource-intensive efforts to make forays into luxury, including tackling counterfeiting issues, and its multi-year media efforts to reposition itself in the pursuit of this objective, Alibaba probably has something else to thank for its ability to attract brands to its site, which cannot be neglected or under-sold: its willingness to cede control to the brands themselves. themselves, to dictate everything from pricing to marketing their products on the Luxury Pavilion site, which differs from its main e-commerce platform.)
Given its not-so-secret attempts to infiltrate the luxury space, which aren’t all that different from Alibaba’s push into luxury, Amazon appears to be using these lawsuits and an array of internal initiatives, such as Project Zero. , as a way to narrow down to specific scrutiny of its platform’s counterfeiting both in the minds of consumers and also of potential brand partners.
As for the success of its luxury ambitions to date, the list of its Luxury Stores, launched almost exactly one year ago, is on the rise, with 45 brands currently listed. Altuzarra, Aquazzura, Christopher Kane, Missoni, Rodarte and Oscar de la Renta are some of the biggest names. It’s also worth noting that Amazon Prime hosts fashion shows for Rihanna’s lingerie brand Savage X Fenty, which likely helps the site bolster its fashion credentials. Nevertheless, its luxury store vertical remains pale compared to other retailers and also to its Chinese rival Alibaba, whose 4-year-old luxury pavilion has brand partners, such as Valentino, Burberry, Versace, Ermenegildo Zegna, Stella McCartney, Tod’s and Moschino. , Just to name a few.
The case is Amazon.com, Inc. v. Fitzpatrick et al, 2: 20-cv-01662 (WD Wash.).