4 ms·

Popsockets is one of the biggest bullies in the marketplace. They've sued many, many sellers that were selling legitimate products trying to bully them off the

by ikeboy 7y ago

Popsockets is one of the biggest bullies in the marketplace. They've sued many, many sellers that were selling legitimate products trying to bully them off the market with various loopholes in the first sale doctrine. https://www.courtlistener.com/docket/14939738/popsockets-llc-v-wilcox/ https://www.courtlistener.com/docket/14939738/popsockets-llc... https://www.courtlistener.com/docket/16007022/popsockets-llc-v-sussman/ https://www.courtlistener.com/docket/16007022/popsockets-llc... https://www.courtlistener.com/docket/15050057/popsockets-llc-v-online-king-llc/ https://www.courtlistener.com/docket/15050057/popsockets-llc... https://www.courtlistener.com/docket/15683859/popsockets-llc-v-outlook-fba-corp/ https://www.courtlistener.com/docket/15683859/popsockets-llc... https://www.courtlistener.com/docket/15639919/popsockets-llc-v-handler/ https://www.courtlistener.com/docket/15639919/popsockets-llc... https://www.courtlistener.com/docket/16620695/popsockets-llc-v-gancfried/ https://www.courtlistener.com/docket/16620695/popsockets-llc... https://www.courtlistener.com/docket/16620699/popsockets-llc-v-yef-trading-inc/ https://www.courtlistener.com/docket/16620699/popsockets-llc... The basic strategy is to include a bunch of FUD about how there's counterfeiters in general on Amazon, then try to lump legitimate sellers in with that. See the 79 page complaint from my last link, filed just last month. They have a template lawsuit that's dozens of pages long, and they just fill in the specific seller details. They have a bunch of screenshots of negative customer reviews, but those are from Amazon broadly and are not connected to the seller they're suing - they use the same negative reviews for all their lawsuits. (It looks like they have two negative feedback for popsocket sales traced to that account out of the many pages of negative reviews that isn't connected to an account.) To be clear, they are not alleging counterfeits in the lawsuits. The claim is that the product doesn't carry the manufacturer warranty, and that sellers don't follow the right quality controls, both of which are very shaky claims legally (warranty restrictions are problematic under federal law, and there's no serious quality control concern on sealed electronics accessory products - it's the same product in the same warehouses, it doesn't magically become lower quality just because a different seller is selling it. There's a potential quality control concern with groceries or products requiring temperature controls, but it stretches credibility to argue that applies to sealed popsockets.) But a small seller can't afford the hundreds of thousands of dollars it takes to get a court decision affirming that. I know multiple sellers that have settled rather than fighting it. It's the path of least resistance. Popsockets is not the only brand that's been using these abusive tactics. There's a string of lawsuits by Otterbox, Skullcandy, GNC, Murad, Standard Process, Noco, and others. Most of them are being pushed by a lawfirm called Vorys, which is associated with a large Amazon seller by the name of iServe/Pattern (one of the top 10 third party Amazon sellers, see https://www.sellerratings.com/amazon/usa https://www.sellerratings.com/amazon/usa, note Zappos and 6PM are Amazon-owned and Asurion, LLC is selling services, not products), that gets exclusive contracts with brands and then sues many of their competition that's undercutting them. It's a scheme just begging for an anti-trust investigation.

wmf 7y ago
Putting legalities aside since IANAL, how would a PopSockets -> third party -> Amazon -> customer supply chain ever be cheaper than PopSockets -> Amazon -> customer? Besides abstract "fairness", what's the benefit of allowing third party resellers here?
- ikeboy 7y ago
  Usually some sort of price discrimination. Let's say Brand X pays $5 to produce something and sells it wholesale for $15 to stores, for a retail price of $30. Assume Amazon fees selling at $30 are $10, so Brand X can sell on Amazon at $30 and get back $20. A third party could divert goods from a retail store, say they pay an extra $1, and price at $28, and will net $18 from Amazon and be left with a profit of $2. Alternatively, maybe a store had overstock and sold the goods in bulk at a loss. Or sometimes they sell the same products cheaper in another country, and it turns out to be cheaper to buy there and import to resell here.
blazespin 7y ago
Interesting, so is it immoral to sue someone who is blatantly copying your product and providing a much cheaper knock off with much poorer quality? I'm not sure how I feel about this. Maybe it's just a bad idea to copy someone else's product unless you really plan on improving upon it. I don't imagine pop socket has a limitless budget for lawsuits either. They may really think they are doing the right thing here. I guess this is the gray market that he's talking about. All these companies that are just copying products and creating cheaper versions with worse quality. And amazon is facilitating that. Interesting and certainly worth shouting about.
- AnimalMuppet 7y ago
  > Interesting, so is it immoral to sue someone who is blatantly copying your product and providing a much cheaper knock off with much poorer quality? That looks like a deliberate deflection. ikeboy specifically said that, while the lawsuit alleges inferior quality, that allegation is bogus. I would say that it is immoral to sue someone alleging inferior quality when the quality is not, in fact, inferior.

by ikeboy 7y ago

wmf 7y ago

Putting legalities aside since IANAL, how would a PopSockets -> third party -> Amazon -> customer supply chain ever be cheaper than PopSockets -> Amazon -> customer? Besides abstract "fairness", what's the benefit of allowing third party resellers here?

ikeboy 7y ago
Usually some sort of price discrimination. Let's say Brand X pays $5 to produce something and sells it wholesale for $15 to stores, for a retail price of $30. Assume Amazon fees selling at $30 are $10, so Brand X can sell on Amazon at $30 and get back $20. A third party could divert goods from a retail store, say they pay an extra $1, and price at $28, and will net $18 from Amazon and be left with a profit of $2. Alternatively, maybe a store had overstock and sold the goods in bulk at a loss. Or sometimes they sell the same products cheaper in another country, and it turns out to be cheaper to buy there and import to resell here.

blazespin 7y ago

Interesting, so is it immoral to sue someone who is blatantly copying your product and providing a much cheaper knock off with much poorer quality? I'm not sure how I feel about this. Maybe it's just a bad idea to copy someone else's product unless you really plan on improving upon it. I don't imagine pop socket has a limitless budget for lawsuits either. They may really think they are doing the right thing here. I guess this is the gray market that he's talking about. All these companies that are just copying products and creating cheaper versions with worse quality. And amazon is facilitating that. Interesting and certainly worth shouting about.

AnimalMuppet 7y ago
> Interesting, so is it immoral to sue someone who is blatantly copying your product and providing a much cheaper knock off with much poorer quality? That looks like a deliberate deflection. ikeboy specifically said that, while the lawsuit alleges inferior quality, that allegation is bogus. I would say that it is immoral to sue someone alleging inferior quality when the quality is not, in fact, inferior.