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<!DOCTYPE html><html lang="en"><head><meta charset="utf-8"><meta name="viewport" content="width=device-width,initial-scale=1,maximum-scale=5,minimum-scale=1,user-scalable=yes"><title>Amazon Got Busted Selling Counterfeit Mercedes-Benz Parts -- Now Everything May Change</title><script type="text/javascript" src="https://sdk.sharethrough.com/gc.js" data-str-disable-tracking="true" async></script><script>window["forbes"] = window["forbes"] || {}; window["forbes"]["isEurope"] = false</script><script>window["forbes"]["isChina"] = false</script><script>window["forbes"]["isUsDpa"] = false</script><script>window["forbes"]["isUs"] = false</script><script type="text/javascript">var templateType = "standard"; window.forbes = window.forbes || {}; window.forbes.isAdvisor = templateType === 'advisor';// this file is external 3rd party code to initiate header prebidding which comes directly from Medianet // https://forbesmedia.atlassian.net/browse/ADSS-77 /* eslint-disable no-underscore-dangle, camelcase */ window._mNHandle = window._mNHandle || {}; window._mNHandle.queue = window._mNHandle.queue || []; window.medianet_versionId = '3121199'; window.medianet_chnm = ''; window.medianet_chnm2 = ''; window.forbes = window.forbes || {}; window.forbes.fastFetchMedianet = true; (() => { const loadScript = (tagSrc) => { const scriptTag = document.createElement('script'); const placeTag = document.getElementsByTagName('script')[0]; scriptTag.type = 'text/javascript'; scriptTag.async = true; scriptTag.src = tagSrc; placeTag.parentNode.insertBefore(scriptTag, placeTag); }; const loadMedianetManagePrebid = (isMobile) => { window.mnjs = window.mnjs || { customerId: isMobile ? 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24"><path d="M7.6 20H4.4V9.4h3.4V20h-.2zM6 8c-1 0-2-.8-2-2s.8-2 2-2c1 0 2 .8 2 2S7 8 6 8zm14 12h-3.2v-5.6c0-1.6-.602-2.4-1.801-2.4-1.4 0-2 .8-2 2.4V20h-3.2V9.4h3.2v1.4s1-1.8 3.2-1.8 3.8 1.4 3.8 4.2V20z"/></svg></a></li></ul></div><p></p> <div id="attachment_41640085" class="wp-caption wp-caption-wrap alignnone"> <div class="article-body-image image-embed__placeholder" style="padding-top: 66.53%; position: relative;"> <progressive-image class="dam-image bloomberg size-large wp-image-41640085" src="https://specials-images.forbesimg.com/dam/imageserve/41640085/960x0.jpg?fit=scale" data-height="639" data-width="960" alt="An illuminated Mercedes-Benz AG badge stands outside the Handelsblatt auto industry conference in... [+] Sindelfingen, Germany. Photographer: Alex Kraus/Bloomberg"></progressive-image> </div> <div class="article-image-caption"> <div class="caption-container" ng-class="caption_state"> <fbs-accordion class="expandable" current="-1"> <p class="wp-caption-text" aria-hidden="true">An illuminated Mercedes-Benz AG badge stands outside the Handelsblatt auto industry conference in<span class="plus" data-ga-track="caption expand">... [+]</span><span class="expanded-caption"> Sindelfingen, Germany. Photographer: Alex Kraus/Bloomberg</span></p> </fbs-accordion> </div> </div> </div> <p></p> <p>While it is of course illegal to sell counterfeit and otherwise trademark infringing merchandise in the U.S., Amazon has so far been able to skirt liability for this crime by claiming they are merely a venue for the sale of such products, as opposed to being the actual seller. While piles of lawsuits have been logged by numerous parties attempting to refute this position, none have yet demonstrated much promise in court. Until now.</p> <div class="article_paragraph_2"></div> <p>Daimler, the parent company of Mercedes-Benz, may have uncovered the smoking gun that could legally prove that Amazon is a <em>direct seller</em> of counterfeit products, and have taken then e-commerce giant to court over it. A successful ruling could rattle Jeff Bezos and Co. to their very core and set a new legal precedent in the process.</p> <p><strong>A history of being untouchable</strong></p> <p>While copyright and trademark laws are <a href="http://www.forbes.com/sites/wadeshepard/2017/10/28/amazon-and-ebay-opened-pandoras-box-of-chinese-counterfeits-and-now-dont-know-what-to-do/" target="_self" data-ga-track="InternalLink:http://www.forbes.com/sites/wadeshepard/2017/10/28/amazon-and-ebay-opened-pandoras-box-of-chinese-counterfeits-and-now-dont-know-what-to-do/" aria-label="clearly being broken en masse">clearly being broken en masse</a> on the Amazon platform — which has been shown ad nauseam by <a href="https://www.cnbc.com/2016/07/08/amazons-chinese-counterfeit-problem-is-getting-worse.html" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.cnbc.com/2016/07/08/amazons-chinese-counterfeit-problem-is-getting-worse.html" aria-label="media sources">media sources</a>, <a href="https://www.thecounterfeitreport.com" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.thecounterfeitreport.com" aria-label="research firms">research firms</a>, and even <a href="http://fortune.com/2016/11/14/amazon-counterfeit-items-lawsuit/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://fortune.com/2016/11/14/amazon-counterfeit-items-lawsuit/" aria-label="Amazon’s own legal litigations">Amazon’s own legal litigations</a> — the company won a landmark lawsuit in 2015 which removed them from responsibility for what third party merchants sell via their platform.</p> <div class="vestpocket" vest-pocket></div> <p>To recap: <a href="http://jolimoli.com" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://jolimoli.com" aria-label="Milo & Gabby">Milo & Gabby</a> is a local Seattle company that makes specially branded animal shaped pillows who made a concerted decision not to sell their products via Amazon. However, one day the company's founders stumbled upon an Amazon ad that featured not only their product but a photo of their daughter. How could that be? As had happened with so many other grassroots entrepreneurs and innovators in the U.S., <a href="http://www.forbes.com/sites/wadeshepard/2017/09/27/amazon-com-the-place-where-american-dreams-are-stolen-by-chinese-counterfeiters/" target="_self" data-ga-track="InternalLink:http://www.forbes.com/sites/wadeshepard/2017/09/27/amazon-com-the-place-where-american-dreams-are-stolen-by-chinese-counterfeiters/" aria-label="Chinese counterfeiters had discovered their product">Chinese counterfeiters had discovered their product</a> and <a href="http://www.forbes.com/sites/wadeshepard/2017/02/14/how-amazons-wooing-of-chinese-sellers-is-hurting-american-innovation/" target="_self" data-ga-track="InternalLink:http://www.forbes.com/sites/wadeshepard/2017/02/14/how-amazons-wooing-of-chinese-sellers-is-hurting-american-innovation/" aria-label="began selling it on Amazon">began selling it on Amazon</a> — complete with the company’s original promotional photos that were lifted right off <a href="http://jolimoli.com" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://jolimoli.com" aria-label="their website.">their website.</a></p> <fbs-ad position="inread" progressive ad-id="article-0-inread" aria-hidden="true" role="presentation"></fbs-ad> <p>The founders of Milo & Gabby initially thought that a lawsuit against Amazon would be a slam dunk: counterfeits of their trademarked products were clearly being advertised and sold on Amazon, the e-commerce giant was taking a commission from each sale, storing the illegal items in their warehouses, and distributing them via their Fulfillment by Amazon program. In a country that is packed with laws to prevent things like this from happening, how could they lose?</p> <p>However, they were very, very mistaken. After a legal battle that dragged on for two years, a nine-member jury decided in favor of Amazon on all counts, <a href="https://www.geekwire.com/2015/amazon-wins-jury-verdict-in-knockoff-pillowcase-suit-setting-precedent-for-counterfeit-goods/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.geekwire.com/2015/amazon-wins-jury-verdict-in-knockoff-pillowcase-suit-setting-precedent-for-counterfeit-goods/" aria-label="ruling that">ruling that</a> “the company was not behind the counterfeit content listed on its site, and had technically not made an 'offer to sell' — the legal requirement to hold Amazon liable for the counterfeit goods.”</p> <div class="article_paragraph_7"></div> <p>Amazon took this ruling and ran with it — instantly being removed from legal liability for <a href="https://www.statista.com/statistics/259782/third-party-seller-share-of-amazon-platform/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.statista.com/statistics/259782/third-party-seller-share-of-amazon-platform/" aria-label="over 50% of what you see on their site">over 50% of what you see on their site</a>, from bearing responsibility for hundreds of millions of products being sold. So IP-infringing, hazardous, or otherwise illegal goods can be sold on Amazon by third party merchants, stored and shipped by Amazon, with complete impunity for the company -- and <a href="http://www.forbes.com/sites/wadeshepard/2017/11/22/as-amazon-and-ebay-flood-with-illegal-goods-from-china-beijing-cracks-down-on-foreign-e-commerce/" target="_self" data-ga-track="InternalLink:http://www.forbes.com/sites/wadeshepard/2017/11/22/as-amazon-and-ebay-flood-with-illegal-goods-from-china-beijing-cracks-down-on-foreign-e-commerce/" aria-label="if these items are being sold across international borders">if these items are being sold across international borders</a>, this protection extends to the seller as well.</p> <p></p> <div id="attachment_813883120" class="wp-caption wp-caption-wrap alignnone"> <div class="article-body-image image-embed__placeholder" style="padding-top: 66.67%; position: relative;"> <progressive-image class="dam-image getty size-large wp-image-813883120" src="https://specials-images.forbesimg.com/dam/imageserve/813883120/960x0.jpg?fit=scale" data-height="640" data-width="960" alt="SUN VALLEY, ID - JULY 13: Jeff Bezos, chief executive officer of Amazon, arrives for the third day... [+] of the annual Allen & Company Sun Valley Conference, July 13, 2017 in Sun Valley, Idaho. (Photo by Drew Angerer/Getty Images)"></progressive-image> </div> <div class="article-image-caption"> <div class="caption-container" ng-class="caption_state"> <fbs-accordion class="expandable" current="-1"> <p class="wp-caption-text" aria-hidden="true">SUN VALLEY, ID - JULY 13: Jeff Bezos, chief executive officer of Amazon, arrives for the third day<span class="plus" data-ga-track="caption expand">... [+]</span><span class="expanded-caption"> of the annual Allen & Company Sun Valley Conference, July 13, 2017 in Sun Valley, Idaho. (Photo by Drew Angerer/Getty Images)</span></p> </fbs-accordion> </div> </div> </div> <p></p> <p>However, it must be emphasized here that the Milo & Gabby case was heard in Seattle: a.k.a. Amazon’s backyard, a place that locals have taken to calling "<a href="http://www.businessinsider.com/amazon-is-taking-over-seattle-2017-4/?IR=T" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://www.businessinsider.com/amazon-is-taking-over-seattle-2017-4/?IR=T" aria-label="Amageddon">Amageddon</a>," a place that t<span>he Seattle Times has dubbed "<a href="https://www.seattletimes.com/business/amazon/thanks-to-amazon-seattle-is-now-americas-biggest-company-town/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.seattletimes.com/business/amazon/thanks-to-amazon-seattle-is-now-americas-biggest-company-town/" aria-label="America’s biggest company town">America’s biggest company town</a>." </span>The e-commerce giant occupies over 40 buildings totaling 8 million square feet of office space in Seattle — more than the space of the city’s next 40 biggest employers combined — and <a href="https://www.geekwire.com/2017/how-seattles-office-market-became-a-modern-day-gold-rush-thanks-to-amazon-and-a-deep-roster-of-out-of-town-tech-companies/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.geekwire.com/2017/how-seattles-office-market-became-a-modern-day-gold-rush-thanks-to-amazon-and-a-deep-roster-of-out-of-town-tech-companies/" aria-label="is still growing fast">is still growing fast</a>, expecting to tack on an additional 4 million feet by 2022, when it will occupy more than 20% of the city’s total office supply. This is more than double the footprint of any other single company in any other American city. Filling all of these buildings are <a href="https://www.seattletimes.com/business/amazon/seattle-will-always-be-home-amazon-employees-others-react-to-news-of-tech-giants-second-hq/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.seattletimes.com/business/amazon/seattle-will-always-be-home-amazon-employees-others-react-to-news-of-tech-giants-second-hq/" aria-label="40,000 employees directly employed by Amazon">40,000 employees directly employed by Amazon</a>, and on the periphery are tens of thousands more whose livelihoods are indirectly tied to the company. In this socio-economic context, the possibility of a fair and impartial jury remains a little suspect.</p> <p>While Milo & Gabby laid the groundwork that has buried many other lawsuits against Amazon for trademark infringement, why the “venue” argument holds up for e-commerce but doesn’t hold for other industries remains a mystery. Peer-to-peer music and file sharing sites tried similar arguments as Amazon but were <a href="https://web.archive.org/web/20080409010037/http://bulk.resource.org/courts.gov/c/F3/239/239.F3d.1004.00-16403.00-16401.html" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://web.archive.org/web/20080409010037/http://bulk.resource.org/courts.gov/c/F3/239/239.F3d.1004.00-16403.00-16401.html" aria-label="toasted in court">toasted in court</a> — with <a href="https://www.theguardian.com/technology/2015/jun/02/last-remaining-pirate-bay-founder-freed-from-jail-fredrik-neij" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.theguardian.com/technology/2015/jun/02/last-remaining-pirate-bay-founder-freed-from-jail-fredrik-neij" aria-label="some of their founders">some of their founders</a> <a href="https://arstechnica.com/tech-policy/2016/06/from-file-sharing-to-prison-a-megaupload-programmer-tells-his-story/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://arstechnica.com/tech-policy/2016/06/from-file-sharing-to-prison-a-megaupload-programmer-tells-his-story/" aria-label="being thrown in prison">being thrown in prison</a>. Meanwhile, Jeff Bezos sits secure as one of the richest men on the planet, directly profiting from the counterfeit products that are arguably <a href="http://www.forbes.com/sites/wadeshepard/2017/09/27/amazon-com-the-place-where-american-dreams-are-stolen-by-chinese-counterfeiters/" target="_self" data-ga-track="InternalLink:http://www.forbes.com/sites/wadeshepard/2017/09/27/amazon-com-the-place-where-american-dreams-are-stolen-by-chinese-counterfeiters/" aria-label="destroying the American dreams of thousands of smaller entrepreneurs">destroying the American dreams of thousands of smaller entrepreneurs</a> across the U.S.</p> <p>“Imagine that it's not Amazon. Imagine that I have a website — we're going to call it Crazy Don's Cocaine Emporium. Now, I'm never going to actually have cocaine, but I'm simply going to put buyers and sellers together. You would aggressively pursue me and you know it,” rants Don Myers, a Florida resident whose once-lucrative apparel design business was <a href="http://www.firstcoastnews.com/money/local-business-owner-claims-problem-with-counterfeits-on-amazon-has-hurt-his-sales/456141181" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://www.firstcoastnews.com/money/local-business-owner-claims-problem-with-counterfeits-on-amazon-has-hurt-his-sales/456141181" aria-label="driven to ruins by counterfeiters on Amazon">driven to ruins by counterfeiters on Amazon</a>, recollected a portion of a phone call he had while filing a complaint against Amazon with the FBI, who is <a href="https://www.stopfakes.gov/article?id=Federal-Bureau-of-Investigation-FBI" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.stopfakes.gov/article?id=Federal-Bureau-of-Investigation-FBI" aria-label="technically responsible">technically responsible</a> for <a href="https://www.fbi.gov/investigate/white-collar-crime/piracy-ip-theft" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.fbi.gov/investigate/white-collar-crime/piracy-ip-theft" aria-label="enforcing U.S. IP laws">enforcing U.S. IP laws</a>.</p> <p></p> <div id="attachment_885656692" class="wp-caption wp-caption-wrap alignnone"> <div class="article-body-image image-embed__placeholder" style="padding-top: 67.23%; position: relative;"> <progressive-image class="dam-image getty size-large wp-image-885656692" src="https://specials-images.forbesimg.com/dam/imageserve/885656692/960x0.jpg?fit=scale" data-height="646" data-width="960" alt="(Photo by Quinn Rooney/Getty Images)"></progressive-image> </div> <div class="article-image-caption"> <div class="caption-container" ng-class="caption_state"> <fbs-accordion> <p class="wp-caption-text" aria-hidden="true">(Photo by Quinn Rooney/Getty Images)</p> </fbs-accordion> </div> </div> </div> <p></p> <p><strong>Day of reckoning?</strong></p> <p>However, the day may come very soon when these laws catch up with Amazon, as trademark and patent infringement lawsuits continue piling up from entities as diverse as <a href="http://www.nytimes.com/2006/10/24/technology/24amazon.html" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://www.nytimes.com/2006/10/24/technology/24amazon.html" aria-label="IBM">IBM</a>, the <a href="http://ipwire.com/stories/university-tennessee-sues-amazon-ibm-patent-infringement/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://ipwire.com/stories/university-tennessee-sues-amazon-ibm-patent-infringement/" aria-label="University of Tennessee">University of Tennessee</a>, the Kickstarted-incubated phone charger manufacturer <a href="https://www.courthousenews.com/amazon-blamed-sales-counterfeit-phone-chargers/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.courthousenews.com/amazon-blamed-sales-counterfeit-phone-chargers/" aria-label="Fuse Chicken">Fuse Chicken</a>, a headset producer called <a href="https://www.bna.com/amazon-sued-alleged-n73014450721/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.bna.com/amazon-sued-alleged-n73014450721/" aria-label="Wow Virtual Reality">Wow Virtual Reality</a>, the maker of the “<a href="https://www.fredlaw.com/internet_technology_trademark__advertising_alerts/2016/12/09/1399/is_amazon_liable_for_counterfeits" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.fredlaw.com/internet_technology_trademark__advertising_alerts/2016/12/09/1399/is_amazon_liable_for_counterfeits" aria-label="Snuggie blanket">Snuggie blanket</a>,” the people behind the $2,000 <a href="https://www.mediapost.com/publications/article/210664/multi-time-machine-argues-amazons-search-engine-c.html" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.mediapost.com/publications/article/210664/multi-time-machine-argues-amazons-search-engine-c.html" aria-label="Multi Time Machine “military ops” watches">Multi Time Machine “military ops” watches</a>, and even the 1990s-era rap group <a href="https://www.engadget.com/2017/01/01/run-dmc-sues-amazon-and-walmart/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.engadget.com/2017/01/01/run-dmc-sues-amazon-and-walmart/" aria-label="Run-DMC">Run-DMC</a>. Even Bezos’s use of the name “Amazon” itself constituted trademark infringement, as it started being used in 1970 by the <a href="https://en.wikipedia.org/wiki/Amazon_Bookstore_Cooperative" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://en.wikipedia.org/wiki/Amazon_Bookstore_Cooperative" aria-label="Amazon Bookstore Cooperative">Amazon Bookstore Cooperative</a> — the first feminist bookstore in the U.S. — who sued Amazon.com over it in 1999 and subsequently <a href="http://www.internetnews.com/ec-news/article.php/232351" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://www.internetnews.com/ec-news/article.php/232351" aria-label="accepted a settlement">accepted a settlement</a>. As wave after wave of lawsuits continue blasting away at the palisades of Bezos's e-commerce fortress, one, above all others, appears to stand a chance of breaking through:</p> <p>At the end of October, a lawsuit was filed in U.S. District Court against Amazon by Daimler AG, the parent company of Mercedes-Benz, claiming that the e-commerce giant violated sections 32, 34, and 35 of the Lanham Act by selling and distributing counterfeit Mercedes-Benz products. What makes this lawsuit different than the legions of similar ones that Amazon has successfully squirmed out of in the past is that Daimler found what may prove to be the most unglamorous smoking gun in legal history:</p> <p>Wheel caps.</p> <p>Yes, Daimler is suing Amazon over three sets of counterfeit Mercedes-Benz branded wheel caps that they discovered being listed on the site as “Ships from and sold by Amazon.com.” According to the parameters of the English language, this would seem to indicate that Amazon was in fact the direct seller and shipper of confirmed counterfeits, which could blow up the Milo & Gabby precedent entirely.</p> <p></p> <div id="attachment_3196" class="wp-caption wp-caption-wrap alignnone"> <div class="article-body-image image-embed__placeholder" style="padding-top: 51.90%; position: relative;"> <progressive-image class="size-full wp-image-3196" src="https://blogs-images.forbes.com/wadeshepard/files/2017/12/Mercedes-Benz-Wheel-cap-Amazon-lawsuit.jpg" alt="What Mercedes-Benz is suing Amazon over. Notice how the listing explicitly says "Ships from and sold... [+] by Amazon.com."" data-height="375" data-width="721"></progressive-image> </div> <div class="article-image-caption"> <div class="caption-container" ng-class="caption_state"> <fbs-accordion class="expandable" current="-1"> <p class="wp-caption-text" aria-hidden="true">What Mercedes-Benz is suing Amazon over. Notice how the listing explicitly says "Ships from and sold<span class="plus" data-ga-track="caption expand">... [+]</span><span class="expanded-caption"> by Amazon.com."</span></p> </fbs-accordion><small class="article-photo-credit">Screenshot from the litigation</small> </div> </div> </div> <p></p> <p>While the Milo & Gabby case — and subsequent appeal — gave Amazon the carte blanche to facilitate and profit from the sale of counterfeit and other illegal products, it also laid out the criteria that future plaintiffs would need to satisfy in order to successfully sue over similarly infringing items, essentially stating that in order for Amazon to be liable they would need to be the seller and then <a href="https://www.linkedin.com/pulse/amazon-scores-big-win-home-court-insulating-itself-from-mark-nielsen/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.linkedin.com/pulse/amazon-scores-big-win-home-court-insulating-itself-from-mark-nielsen/" aria-label="defined what this means">defined what this means</a>: a seller sets the price, controls inventory, advertises, handles shipment, etc. This is exactly what Mercedes-Benz and Amazon are now facing off over.</p> <p><a href="https://www.geekwire.com/2016/daimler-ag-sues-amazon-knockoff-mercedes-wheels-new-test-e-commerce-giants-liability-counterfeit-goods/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.geekwire.com/2016/daimler-ag-sues-amazon-knockoff-mercedes-wheels-new-test-e-commerce-giants-liability-counterfeit-goods/" aria-label="The litigation">The litigation</a> reads:</p> <blockquote> <p>“Although Amazon has received significant negative publicity for its facilitation of rampant infringement of intellectual property rights by third parties in the Amazon Marketplace, the sales at issue in this case are not merely third party sales that are facilitated by Amazon in the Amazon Marketplace; rather the sales at issue are infringing products that are “shipped from and sold by Amazon.com.”</p> </blockquote> <p>Daimler claims in the litigation that they have never “authorized or consented to Amazon’s use of the Mercedes-Benz Marks, or any confusingly similar marks, on vehicle parts” or “authorized Amazon to copy, manufacture, import, market, sell or distribute any vehicle parts bearing the Mercedes-Benz Marks.”</p> <p>However, Daimler didn’t just sneakily take a screenshot of some wheel caps, shout “gotcha!” and push the sue button. No, according to the litigation they warned Amazon in advance, clearly pointing out the infringement, but it was all to no avail. Like so many other merchants complaining about their products being knocked-off on Amazon, the company’s response proved <a href="http://www.forbes.com/sites/wadeshepard/2017/01/12/why-amazon-is-losing-its-battle-against-chinese-counterfeiters/" target="_self" data-ga-track="InternalLink:http://www.forbes.com/sites/wadeshepard/2017/01/12/why-amazon-is-losing-its-battle-against-chinese-counterfeiters/" aria-label="inadequate to keep such infringing items off the site">inadequate to keep such infringing items off the site</a>.</p> <p></p> <div id="attachment_822222962" class="wp-caption wp-caption-wrap alignnone"> <div class="article-body-image image-embed__placeholder" style="padding-top: 61.32%; position: relative;"> <progressive-image class="dam-image getty size-large wp-image-822222962" src="https://specials-images.forbesimg.com/dam/imageserve/822222962/960x0.jpg?fit=scale" data-height="589" data-width="960" alt="(KARL-JOSEF HILDENBRAND/AFP/Getty Images)"></progressive-image> </div> <div class="article-image-caption"> <div class="caption-container" ng-class="caption_state"> <fbs-accordion> <p class="wp-caption-text" aria-hidden="true">(KARL-JOSEF HILDENBRAND/AFP/Getty Images)</p> </fbs-accordion> </div> </div> </div> <p></p> <p>“With Amazon now caught as a direct seller they've got some issues,” explained Craig Crosby, the director of <a href="https://www.thecounterfeitreport.com" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.thecounterfeitreport.com" aria-label="the Counterfeit Report">the Counterfeit Report</a>, a consumer advocacy organization that has directly sent Amazon over 32,000 notices of counterfeit items listed for sale on their site. “I’ve talked to several firms who handle Amazon suits and they always tend to approach them the same way: 'Third party seller, we bought something, somebody got hurt, a house burned down, you're infringing upon our mark,' and the courts held that they're just a venue. But, <em>now</em>, Amazon is a direct seller.”</p> <p>According to the litigation, what struck Daimler as being particularly concerning was the fact that many consumers view products on Amazon which have the “Ships from and sold by Amazon.com” label as protection against counterfeit goods, “believing that items they purchase from Amazon will be vetted by Amazon and authentic.”</p> <p>These new findings ultimately leave the customer in a precarious situation when shopping on Amazon. As pointed out by Julie <span>Zerbo of <a href="http://www.thefashionlaw.com/home/amazon-is-tricking-consumers-with-its-ships-from-and-sold-by-amazon-label-per-new-suit" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:http://www.thefashionlaw.com/home/amazon-is-tricking-consumers-with-its-ships-from-and-sold-by-amazon-label-per-new-suit" aria-label="the Fashion Law Blog">the Fashion Law Blog</a>:</span></p> <p>“If the allegations set forth in recent lawsuits are to be given any weight, Amazon is sorely lagging in its efforts to police its platforms for fakes, meaning that the consumer is left with the responsibility of attempting to distinguish between authentic and infringing products, which is often a daunting task.”</p> <p>While it is unclear what a ruling in favor of Daimler would really mean for the Amazon marketplace, it seems as if it could set a new precedent for holding e-commerce platforms liable for the products they sell.</p> <p>“Capitalism at its best allows these websites to go out and under the umbrella of being a venue do anything they want without any liability. Until now,” <span>Craig Crosby concluded.</span></p> <p>However, industry insiders fear that this lawsuit stands a good chance of disappearing from public view and being <a href="https://www.seattletimes.com/business/amazon-settles-long-standing-legal-dispute-with-toys-r-us/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.seattletimes.com/business/amazon-settles-long-standing-legal-dispute-with-toys-r-us/" aria-label="settled out of court">settled out of court</a> — as are <a href="https://www.forbes.com/sites/ericgoldman/2013/12/26/want-to-know-amazons-confidential-settlement-terms-for-a-keyword-advertising-lawsuit-merry-christmas/#3c016a5c575b" target="_self" data-ga-track="InternalLink:https://www.forbes.com/sites/ericgoldman/2013/12/26/want-to-know-amazons-confidential-settlement-terms-for-a-keyword-advertising-lawsuit-merry-christmas/#3c016a5c575b" aria-label="many other suits">many other suits</a> that <a href="https://arstechnica.com/tech-policy/2017/10/amazon-sends-out-another-round-of-settlement-payments-from-e-book-case/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://arstechnica.com/tech-policy/2017/10/amazon-sends-out-another-round-of-settlement-payments-from-e-book-case/" aria-label="Amazon fears">Amazon fears</a> they <a href="https://www.cnet.com/news/amazon-com-wal-mart-settle-lawsuit/" target="_blank" rel="nofollow noopener noreferrer" data-ga-track="ExternalLink:https://www.cnet.com/news/amazon-com-wal-mart-settle-lawsuit/" aria-label="may not win">may not win</a>.</p> <p>Amazon did not respond to requests for comment.</p> <p><em>*Update 12/07/17: The screenshot of the offending product listing was changed to a screenshot taken directly from the litigation. </em></p><div class="newsletter_signup_article"></div></div><div class="sigfile article-body fs-responsive-text"><span>Follow me on </span><a href="https://www.twitter.com/wadeshepard" rel="nofollow noopener noreferrer" target="_blank">Twitter</a> or <a href="https://www.linkedin.com/in/wadeshepard" rel="nofollow noopener noreferrer" target="_blank">LinkedIn</a>. <span>Check out </span>my <a href="https://www.vagabondjourney.com/" rel="nofollow noopener noreferrer" target="_blank">website</a> or some of my other work <a href="https://www.amazon.com/Ghost-Cities-China-Populated-Arguments/dp/178360218X" rel="nofollow noopener noreferrer" target="_blank">here</a>. </div><div class="bottom-contrib-block"><div class="fs-author-group-wrapper"><div class="contrib-byline"><a class="fs-author-avatar" href="https://www.forbes.com/sites/wadeshepard/" title="Photo of Wade Shepard"><img class="fs-author-image" src="https://secure.gravatar.com/avatar/5ca38a1fec91cca74f8430d79ff301fa?s=400&d=mm&r=g" alt="Wade Shepard"></a><div class="contrib-info"><div class="author-wrapper"><a class="author-name contrib-byline-author speakable-author" href="https://www.forbes.com/sites/wadeshepard/" title="https://www.forbes.com/sites/wadeshepard/" aria-label="Wade Shepard" data-ga-track="contrib block byline">Wade Shepard</a></div></div></div><fbs-cordial type="Follow" natural-id="blogAuthorId/blog/author/1754769" author-slug="wadeshepard" page-position="bottom"><a class="following-label" href="https://account.forbes.com/following" target="blank" title="https://account.forbes.com/following" aria-label="Following"><svg class="fs-icon fs-icon--check-mark" xmlns="http://www.w3.org/2000/svg" viewBox="0 0 20 20"><path fill-rule="evenodd" clip-rule="evenodd" d="M10 2.9c-3.9 0-7.1 3.2-7.1 7.1s3.2 7.1 7.1 7.1 7.1-3.2 7.1-7.1-3.2-7.1-7.1-7.1zm-.7 10.3l-3-2.1.7-1 2 1.4 3.4-4.9 1 .7-4.1 5.9z"/></svg><span>Following</span></a></fbs-cordial></div><p class="contrib-bio" data-author-html-description="<p>I'm a perpetually traveling writer and documentary filmmaker who reports from the ground on emerging markets, China, and the economic transitions that are shaping our world. 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Now in Central and South America.&nbsp;</p><p>I have appeared on CNBC Squawk Box, CBC The Current, Forbes.com, VICE, NPR Morning Edition, ABC News, and BBC World.</p>"></p></div><div class="article-footer" style="border:;"><ul class="footer-row color-body light-text print-tips"><li><a href="https://www.forbes.com/sites/forbesstaff/article/forbes-editorial-values-and-standards/" rel="noopener noreferrer" target="_blank">Editorial Standards</a></li><li><a href="https://www.parsintl.com/publications/forbes/" rel="noopener noreferrer" target="_blank">Forbes Accolades</a></li></ul><div class="footer-ad-labeling" aria-hidden="true" tabindex="-1"></div></div></div></div><div class="right-rail" article-index="0"><div class="video-placeholder"><div class="video-player inactive" data-nosnippet></div></div><div class="ad-rail"><div class="fbs-ad-wrapper fbs-ad--article-0-rec-wrapper recx-alignment"><fbs-ad ad-id="article-0-rec" batched position="rec"></fbs-ad></div><div class="fbs-ad-wrapper 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