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Comment by crazygringo | Hacker News Reader

Doesn't seem like a big deal, because:

> In Wednesday’s opinion, Circuit Judge Jane Richards Roth, writing for a 2-1 majority of a three-judge panel, said Amazon may be liable in part because its business model “enables third-party vendors to conceal themselves from the customer, leaving customers injured by defective products with no direct recourse to the third-party vendor.”

Seems like Amazon can just force third-party vendors to reveal their full legal identity to the customer then?

I don't care who's liable as long as someone's liable and it's fully enforceable within the US court system.

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It is still a big deal, because customers are going to be a LOT more hesitant to buy stuff if they realize it's sold by a random Chinese dude and not Amazon.

And they should be.

Not really. Amazon’s entire supply chain is filled with counterfeits.

Why do you think that refutes sin7's point?

And, if Amazon's entire supply chain is filled with counterfeits, all the more reason why Amazon should 1) reveal who the seller really is, or 2) be liable for the counterfeits.

You misread the comment you're replying to, I think. empath75's claim "Amazon’s entire supply chain is filled with counterfeits" is intended to mean that parties other than the seller—such as warehouse employees, delivery companies, importers, etc.—are also inserting counterfeits into Amazon's supply chain, such that even products "sold by Amazon" in the strictest legal sense, can potentially still be counterfeits.

Given this, customers should already have been wary of purchasing from Amazon, enough that finding out that they're often purchasing from third-parties shouldn't further affect their opinion (i.e. they should already have as low an opinion of Amazon as if they had already known that, because of the other supply-chain problems.)

How much of that is supply chain issues and how much is commingling inventory with third party sellers?

Most people don't have that opinion though - things brought through Amazon are viewed as being vetted and high quality when compared to items through eBay or Wish - Amazon has made no effort to disabuse people of this conception and I personally think they've worked actively to downplay the role the third party plays in product delivery.

I've also always been a bit curious if amazon might be liable for defective products shipped through their warehouse by virtue of the transfer of custody alone. This sort of business model is quite new (it's worlds different from a flea market) and there are several interesting commercial responsibility questions around it.

I think that this article means the opposite... and that Amazon could be liable for stuff that you buy from random Chinese dudes. So it should become less risky.

The GP means (I think) that this decision effectively forces Amazon to make a decision: either stop permitting third-party sellers or else require third-party sellers to identify themselves (and, implicitly, provide bona fide contact information). The result of the second option is that many third-party sellers on Amazon will be exposed as Chinese sellers who in practice cannot be held accountable.

In both cases, Amazon loses business.

Amazon will just play games where you have to dig through a bunch of menus to figure it out.

They already do this today, and clearly the judge isn't letting it slide.

GP here: And not just contact information, but a legitimate US legal and financial presence.

If you're selling in the US, I need to be able to effectively sue you and win in the US if you sell harmful or illegal products, full stop. So you should have to put up some kind of financial bond and a law firm to represent you. Because mom and pop businesses can't do this themselves, this should be provided as a kind of insurance policy that's just part of the cost of doing business. Heck, Amazon can be that insurance policy if they want.

But right -- if I can't sue you, you should under no circumstances be allowed to sell within the US on a US platform.

My wife runs a small side-business and has a Seller account on Amazon. I'm a little nervous for what this might mean (assuming they don't appeal and actually do something about it) in the short term in terms of compliance costs, etc., but in the long run I think it's for the best. There is a real problem with inferior quality products and intellectual property/copyright theft from non-American sellers and aside from that the points you note are valid too: people who buy from sellers using Amazon's platform ought to have recourse--and either Amazon or the seller has to provide it when required.

You ought to talk to a lawyer about your best options. It may be something like an LLC.

Any US legal entity (corporation, LLC, etc.) formed in one of the 50 states is required to have a registered agent in its state of formation. The primary purpose of said registered agent is to receive legal process on behalf of the US legal entity.

So any US corporation or LLC should meet the "US legal and financial presence" requirement that you describe.

And it allows manufacturers to see which sellers are skirting their reseller agreements and tighten up their distribution if they so choose.

Why would it be a random Chinese dude instead of a random American company?

So uh, what is supposed to keep the Chinese dude from paying $100 to start a LLC in the US to sell through?

What exactly am I missing here?

> Seems like Amazon can just force third-party vendors to reveal their full legal identity to the customer then?

Minimizing the prominence of seller identity and maximizing that of the Amazon brand has been a key Amazon business strategy; they very much want sellers not to matter.

I suspect, though, that even were that problem cured, their commingling practice would leave them liable unless they also allowed buyers access to the identity of and the ability to reject transactions based on the original product source (which may not be the seller, due to commingling) with FBA products.

" Seems like Amazon can just force third-party vendors to reveal their full legal identity to the customer then?"

I bought a defective sever power supply from a 3rd party seller at Amazon in Europe. Amazon claims they don't know the identity/address/email of this seller. Wrote it off as a loss.

Edit: I mean, Amazon must have given this guy my money. They must have something from him. Bank account, Email etc.

That would require Amazon to stop co-mingling real and counterfeit products which would in turn dramatically help the problem. It probably wouldn't fix everything but being able to make an informed decision would help.

Agreed. If that's the case, then this is completely fair.

If Amazon wants to conceal information about the seller, then they have to deal with the things that the seller would usually deal with.

Amazon could end up being required to declare the seller’s information to the buyer (at time of purchase!), and required to validate that information using expensive non-trivial practices such as business license lookups and tax form SSN/EIN checks. This court decision implies that liability defaults to Amazon under their current practices, and shifting that liability would need to involve disclosure prior to sale. These are all absolutely market-destroying things - and when you apply them to eBay, which does not provide seller contact information or perform tax validation before the sale occurs, it only worsens in potential impact for businesses profiting off of their enforcement-free approach today.

Sounds like a good thing to protect consumers. Would this be problematic for most people?

I was researching creating a 2 sided marketplace for selling certain electronics this week. This is a bad omen maybe

"I'm going to compete with eBay in a market visibly riddled with fraud and malicious actors" is probably a bad omen regardless of the third-party problem.

But. If you arrange the transaction between the two sellers and hold payment+device in escrow, then that's clearly "arranged between two sellers" and wouldn't be the target of this ruling.

(Escrow insurance isn't cheap, though. And without escrow, you have nothing but risk.)

The use of an approach based on Letters of Credit entail clasuses that compel arbitration. That means there must be "Principled Documents" available that will support a court case in the event the arbitration process fails. Further, it is now seen that there are weaknesses in arbitration jurisprudence that allow either party to reneg on payments to the arbitrator; in which case the judge must dismiss the case. (Harvard Negotiation Law Review). It is not clear if the arbitration process will be modified (read: repaired). In effect, Amazon is asking to ignore precedent jurisprudence.

It seems to me that the difference with Ebay is that I am buying from a specific person (even if that person is effectively a stranger to me). On the other hand with Amazon I'm presented with a product that happens to be sold by many different people.

Indeed, I think that’s a critical difference that has likely protected eBay from this concern - and is an area where Amazon thought it could differentiate itself without risk of liability. The risk to eBay is that Amazon’s push on that front of deniability creates a backlash that imposes new constraints of disclosure and/or verification on eBay.

eBay is a flea market. It's what that sell themselves as. You are knowingly purchasing used items and there's almost always a picture of the exact item you're getting and where it's being shipped from. Amazon by comparison is a black box of magic, only the magic smoke is toxic and you have no idea who to go to for redress. Amazon has gotten a free ride for years, screwingb both their sellers and buyers, making knock off products when it sees profit motive, it's time to pay the Piper.

I've bought and sold a moderate amount on eBay - as a buyer I am protected for the most part. Every dispute I've filed as a buyer I've won, and every dispute I've had filed against me as a seller (2, in 10 years) I've lost. One was my fault (I made a mistake with the description) and the other was someone claiming I shipped the wrong item, (which I didn't, they just got a free game out of it). The weighting is heavily in favour of the buyer on eBay, and even after being scammed once I still think it's the right thing to do.

On the flip side for Amazon,it feels unfair that the seller has my contact details and can use it to send me emails asking for reviews and to market their other products even when I've opted out of marketing emails. I've had a few counterfeit products where the seller just hasn't responded and I've been refunded but left with the counterfeit item, which doesn't sit well with me. The comingling is an awful problem, and if there were another site that offered next day delivery on a variety of goods with guaranteed wualotythat was more expensive, id swap in a heartbeat.

Inventory commingling could also be a problem here— the vendor you’re ostensibly buying from isn’t actually providing the product you receive, and there’s no way to find out who did provide it.

I think the issue is more than just exposing full legal identity. The shopping experience on Amazon is an abstraction. When looking at Product X, on different days, different sellers may be in the "buy box". From the customer's perspective, they are buying from Amazon, not the vendor.

And this is deliberately misleading

IANAL, but what happens when the third party vendor is in China, effectively out of reach from a US consumer? Would Amazon be the defacto responsible party.

They can be banned from amazon at least

> Seems like Amazon can just force third-party vendors to reveal their full legal identity to the customer then

They already do. You have their data on invoice.

Bullocks.

For example, try to track down this seller (Amazon Germany)

https://www.amazon.de/sp?asin=&isAmazonFulfilled=&isCBA=&sel...

OK, I am not that familiar with Amazon DE's operation, I only ran companies that acted as 3rd party sellers on Amazon US, including writing MWS software, and they had certain requirements.

On invoice? What invoice?

When I order from a third-party seller, there's no guarantee there's any invoice?

If they ship directly, sometimes it comes with a kind of paper receipt, sometimes it doesn't.

If they fulfill via Amazon, it definitely doesn't. I don't think I've gotten a receipt/invoice with any Amazon package in years... (I remember it used to come with them.)

And I click through my online order and click on the name of the seller, it just has tabs with things like generic shipping and return policies. I can't find any legal or contact info whatsoever beyond the name.

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