Category Archives: The Case Against Amazon.com, Inc.

Amazon steps up customer blacklisting in April 2018; Binding arbitration clause limits customers’ legal options

My contact in California who is suing Amazon in small claims court suggests pursuing a class-action lawsuit against Amazon in a red (Republican) state (e.g., Alabama). She believes this would be a more favorable venue than the U.S. federal 9th circuit (Washington, Oregon, California) which tends to be Amazon-friendly. At the same time, Republicans often prioritize corporations over individuals’ rights to redress, so they may uphold binding arbitration clauses that prevent any court actions except small claims.

I contacted a lawfirm with this email. It may not be possible to pursue class-action due to the binding arbitration clause in Amazon’s terms, however.


Hello,

I am writing to inquire about the possibility of a class-action lawsuit against Amazon.com, Inc. regarding the many customers they have blacklisted without explanation. They refuse to return pro-rated Prime membership fees, gift card balances, stored photos, Kindle e-books, et cetera. They also do not stand by their return policy for blacklisted customers.

Beginning on Friday, March 30, 2018, Amazon.com, Inc. has stepped up their blacklisting of customers, citing TOS violations such as writing a review for an item that a customer received a discount code from the seller. Many customers did not even appear to break the terms yet have been blacklisted. Some are saying this is a glitch, but Amazon has a history of illegal practices relating to blacklisted customers dating back to 2008. Members of Amazon.com, Inc. who were banned within the past week have a Facebook group, which already has 2,795 members.

Although Amazon’s terms claim they can seize a customer’s gift card balance at any time, I believe this is in violation of the Credit Card Accountability Responsibility and Disclosure Act of 2009, Chapter 19.240 of the Revised Code of Washington, and Florida Statute 501.95. Amazon previously blacklisted me in August 2015 and stole my $451.20 gift card balance, but settled in February 2016 with me. However I am still trying to get them to discontinue these practices against other customers. With respect to blacklisted customers, Amazon fails to honor their return policy, does not pro-rate refunds of Prime membership, and does not allow access to order histories, purchased Kindle e-books, music, or saved files. This likely violates other laws.

One large hurdle is that Amazon’s terms say they can only be sued via small claims court. Otherwise, binding arbitration applies.

Please let me know what you think about this. If your lawfirm is not interested but you think another lawfirm would be interested, please refer me.

Thanks,
Richard Thripp, M.A.
Doctoral Student, Instructional Design & Technology
Graduate Teaching Associate – EME 2040 Instructor
University of Central Florida


In response, the lawyer said that Amazon’s Terms and Conditions prohibit anything but binding arbitration, to which I replied:


Hi, Attorney X and Jane Doe,

Jane Doe is in California and had contacted me about possibly submitting a written deposition as an expert witness regarding her small claims suit against Amazon for $3,400 of gift card balances. I had blind carbon copied her on my initial email to you.

In 2015, the NYT did an exposé, Arbitration Everywhere, Stacking the Deck of Justice. This is why Amazon and many other corporations cannot be sued via class-action, or at all, for that matter, besides small claims.

It is highly unlikely the SCOTUS would overturn their 2011 and 2013 decisions or that Amazon would be criminally charged. But, one option would be to flood them with small claims suits. Most consumers do not have the knowledge, time, or motivation to sue in small claims court unless their loss is relatively large. It would be interesting if a lawfirm could handle such suits at a large scale like traffic ticket mills.

Small claims allows discovery in some jurisdictions, which could be costly and get Amazon’s attention. In Washington state, discovery is not allowed, but in Florida, it is. Of course, people who just lost access to their photos probably wouldn’t have good cases, and losing an Amazon Prime membership is a max of $99 loss… It would make sense for people with large gift card balances to sue in small claims court, though.

Unfortunately, as a non-lawyer I am not permitted to give legal advice on my blog, the Facebook group, et cetera.

Best regards,
Richard Thripp


Note added 2018-04-11: Commentators should take note that a class-action lawsuit appears untenable against Amazon.com, Inc. due to the binding arbitration clause. In fact, any lawsuits except small claims suits are prohibited. Binding arbitration tends to result in decisions favorable to Amazon, while courts are less favorable to Amazon. This is why I have suggested law firms or individual attorneys should counsel consumers in small claims suits against Amazon at a massive scale, like law firms that specialize in traffic tickets at a low fee. Cases in which Amazon has stolen a customer’s Amazon gift card balance are especially viable in small claims courts.

I Stand with Donald Trump Against Amazon.com, Inc.

Donald Trump and Jeff Bezos

Amazon, in their sole discretion, reserves the right to blacklist customers and steal the existing Amazon gift card account balance tied to their Amazon account. Like other gift cards, these gift cards are NOT reward points, coupons, or promotions. However, Amazon’s hubris is so massive that they will admittedly refuse to refund gift card balances in written statements to the Attorney Generals of Washington state and Florida, and no one will rein Amazon in, except Donald Trump.

Amazon’s behavior regarding gift cards is NOT appropriate nor legal. Jeff Bezos says Donald Trump’s attack on Amazon is “not an appropriate way for a presidential candidate to behave.” Amazon’s behavior regarding gift card balances is inappropriate and illegal. Jeff Bezos is in no position to claim the moral high ground and never will be.

Amazon is also known for withholding or permanently stealing account balances from Amazon Marketplace Sellers. Amazon encourages buyers to seek recourse against marketplace sellers through their A–Z guarantee policy. It is practically unheard of for a case to be decided in the seller’s favor. Amazon uses such complaints as ammo to justify permanently banning sellers and seizing their account balances, even when buyers may have been in the wrong, such as by refusing to return the allegedly defective items or even to acknowledge basic troubleshooting requests.

Amazon and CEO Jeff Bezos are at the apex of hypocrisy. Customers who complain too frequently about items ordered directly from Amazon, or receive too many “concessions” from Amazon, are blacklisted, in Amazon’s sole discretion. This includes theft of their gift card balances, and may occur even if all complaints were legitimate. Amazon profits by stealing gift card balances from blacklisted buyers, as well as from stealing account balances from blacklisted sellers. These illegal acts help Amazon undercut competitors and continue to report high free cash flow, increasing their valuation and potentially swindling investors. At all times, Amazon, in an Enron-like fashion, refuses to follow generally accepted accounting principles.

Amazon and Enron logos

Below are actual quotes from official emails from Amazon employees:

Regarding your gift card funds: We closed your account because you reported an unusual number of problems with your orders. As a result, your unused gift card balance is no longer available.” — Excerpt from an actual message sent by Amazon to Louis Morgan regarding his Amazon gift card balance of over $400.

I’m sorry for any inconvenience caused by the closing of your Amazon.com account. I’ve reviewed the account and our previous communications with you, and can confirm the decision was a valid one. Please note this isn’t a decision we can reconsider, and we won’t be able to issue a refund for the gift card balance.” – Excerpt from an actual message from Suresh Potnuru of Amazon.com to Richard Thripp, regarding his $451.20 gift card balance.

As noted in our Conditions of Use, in the section, ‘Your Account’: ‘Amazon reserves the right to refuse service, terminate accounts, remove or edit content, or cancel orders in its sole discretion.’” – Suresh Potnuru, Amazon.com, Inc., 9/29/2015, in communication with the Better Business Bureau of Alaska, Oregon & Western Washington in regards to Complaint #10830673 by Richard Thripp.

Due to the proprietary nature of our business, we’re unable to discuss with you, and the decision to close your account is a final one.” – Suresh Potnuru, Amazon.com, Inc., 9/29/2015, in communication with the Better Business Bureau of Alaska, Oregon & Western Washington in regards to Complaint #10830673 by Richard Thripp.

At the end of the day, you should do what you need to do to maximize free cash flow for the device. Do what you need to do to make more money. I don’t know if exposing that we have 100 orders gets us there [obviously exposing that we only got 100 orders on a major advertising media buy is not a good result], but you can decide what to do to maximize FCF [Free Cash Flow]” — Jeff Blackburn, Senior Vice President of Amazon.com, Inc., advocating lying to Discover Financial Services about a joint promotion botched by Amazon.com, Inc.

Justice

The only way to get a settlement from Amazon is to take them to court. The only court you can take them to is small claims, because you already agreed to binding arbitration by using Amazon—a legal fiction that the United States Supreme Court ludicrously upholds, again and again.

Amazon’s corruption may be far more pervasive and systematic than generally known. Amazon is well-known for treating employees like shit, including securing their “agreement” to 2-year non-compete agreements, effectively ruining their career prospects after Amazon summarily dismisses employees like Kivin Varghese for standing up against Amazon’s institutionalized corruption. For employees, Amazon acts as a total institution, shredding normal Americans who desire time with their kids or a social life. Amazon is a narcissist’s dream, apparently existing for, to quote George from Seinfeld, the glorification of Jeff Bezos’ massive ego—the ultimate narcissist of them all.

Bezos is forever inured with colonizing space, at immense cost in the face of evidently insurmountable challenges, while having no interest in meaningful charitable work that might benefit blighted Americans in Detroit or Oakland. In classic narcissistic style, Bezos’ flagship donations to Princeton University and the Seattle’s Museum of History & Industry involve centers and buildings being conspicuously named after him, even though, unlike Trump, Bezos does not capitalize on his name as a brand.

Here is another gem from an Amazon’s Suresh Potnuru, responding to my BBB complaint on 9/27/2016:

“I realize you’re upset, and I regret we’ve been unable to address your concerns to your satisfaction. However, we’ll not be able to offer any additional insight or action on these matters, and any further inquiries on this matter won’t receive a response.”

Oh, the condescension and hubris! Like a child throwing a hissy fit, I must be consoled and put in my place by my CORPORATE OVERLORDS at AMAZON.COM, INC. No one can dispute that Jeff Bezos runs a tight ship at Amazon.com, Inc.—unlike Steve Jobs, he has retained control of the company through its entire lifespan. I wouldn’t be surprised if Mr. Bezos was directly and gleefully involved in writing Amazon’s patronizing canned replies to blacklisted customers, merchants, and vendors.

COMMENTATORS WHO ARGUE the baselessness of Donald Trump’s claim that Amazon is guilty of antitrust violations seem far too quick to forget that Amazon wields its clout mightily against authors and booksellers. While Amazon alleges these actions benefit consumers, Amazon itself demands extremely favorable terms from partners, including high fees and COMPLETE OPACITY regarding web traffic analytics, enabling them to conceal breaches of contract as with Discover Financial Services. In all of its businesses, any benefit that Amazon yields to its customers or clients may merely be a side-effect of its ceaseless, narcissistic rampage against its competition and against the laws of the United States, evidenced by its blatant, orchestrated theft of the gift card and seller account balances of thousands of clients.

JEFF BEZOS PURCHASE AND CONTINUED OWNERSHIP OF THE WASHINGTON POST is clearly a massive, irreconcilable conflict of interest, and yet goes largely unacknowledged, except by Donald Trump, who is continually and unsuccessfully dismissed as a crackpot by the Washington Post and others. While it would not be accurate to claim that criticism of Trump is solely fueled by establishment interests, the media’s preference for Hilary Rodham Clinton is palpable—if Trump had laughed about getting a pedophile acquitted on a technicality, we would certainly not hear the end of it. What the New York Times has succeeded in dredging up about Trump pales in comparison.

Corporate consolidation is clearly out of control—Theodore Roosevelt would not be pleased. For the love of Jeff, KRAFT AND HEINZ ARE ONE COMPANY. Imagine being blacklisted by Kraft Heinz and being denied access to BOTH CHEESE AND KETCHUP. Unlike the Bell System breakup, no one is calling for Amazon Web Services to be split off from the mothership. No one is protesting Amazon developing its own trucking network, television studios, or transoceanic shipping lanes. Fortunately, the government of the United States is making antitrust decisions conveniently beneficent to Amazon, such as forbidding the Staples–Office Depot merger. What is kosher in Seattle is clearly not permissible in Framingham.

No one is protesting that Amazon effectively owns the Washington Post. The control that Bezos wields over Amazon is far more totalitarian than the control Jobs wielded over Apple. No one seems to notice but Donald Trump. Fortunately, based on the results of the Republican primaries, it seems bad publicity only vindicates Trump as an underdog outsider who the elites don’t want us to have. They obviously do not have the type of dirt on Trump they wish they had, or we would certainly be hearing about it.

Amazon’s crimes only became of earnest interest to me when they banned my account and stole my gift card balance in August 2015. Amazon continually concealed, misled, and treated me like crap—their legal department even refused my small claims summons on the basis that a summons against Jeffrey Preston Bezos could not be accepted because they could not accept a summons on “BEHALF OF AN EMPLOYEE.” The ludicrousness of Amazon’s position was abundantly clear to an editor for consumer advocate, Christopher Elliott. However, few people care about injustice, particularly financial injustice, unless it personally affects them. To Make America Great Again™, we need to start caring about financial injustice. My course, Introduction to American Personal Financial Literacy, partially completed in partial fulfillment of my Master of Arts in Applied Learning & Instruction from University of Central Florida, conferred May 7, 2016, aims to do this. I will get to work on finishing it soon…

To Amazon: When you decided to defraud Richard Thripp, you pissed off the wrong dude. Yes, a settlement was reached. However, your egregious activities continue unabated. THIS IS UNACCEPTABLE. May your joy turn to ashes in your mouth for the love of $451.20 (George R. R. Martin, Clash of Kings).

Donald Trump and Jeff Bezos (flipped)

Amazon Continues Stealing Gift Cards

On the forums of consumer advocate, Christopher Elliott, another customer, Louis Morgan, has been victimized by Amazon, to the tune of $400:

Amazon Stealing $400+ of Customer Money Again! (Beware of Amazon!)

My take on it: Amazon is brazen. As the U.S. federal government and Florida state government are scaling back their civil asset forfeiture programs due to overwhelming negative publicity, Amazon continues the similar practice of stealing gift card balances, despite having no legal ground to stand on.

Below, is my reply to Morgan’s case, and a reasoned argument that Amazon gift cards should be completely avoided.

The replies Morgan received from Amazon reveal more of Amazon’s hubris, particularly this statement:

Regarding your gift card funds —

We closed your account because you reported an unusual number of problems with your orders. As a result, your unused gift card balance is no longer available.

Let that sink in. Imagine if a bank closed your account and said your bank account balance was no longer available because you were a problem customer. What we are looking at is a different situation, yet it shares similarities. Gift cards have more legal protections than airline miles, which typically have none. Yet, Amazon feels confident in flouting the law and enhancing their bottom line through theft of gift card balances and Amazon Seller account balances.

The recurring theme among Elliott commentators is that we cannot judge Amazon having heard only the customer’s side of the story. Surely, Amazon’s actions are legitimate and Morgan is omitting nefarious activity. However, Amazon is the judge, jury, and executioner. They hold the cards and when they ban you, they cut access to your account history and information while retaining it for themselves. Further, Amazon often declines to articulate its position even to the injured party.

When we read Amazon or Yelp reviews, do we care about the position of the manufacturer, distributor, or business owner? No—typically we look for a concordance of evidence from multiple reviewers (while perhaps using tools like www.fakespot.com). The evidence that Amazon is systematically stealing gift card balances, and that this practice has been going on since 2008, is approaching consilience.

How many stories go untold from customers who were actually doing shady things such as trading Amazon gift cards for BitCoin? As a government practice, the tide is turning against civil asset forfeiture—the U.S. federal government has suspended its equitable-sharing program and in Florida, effective 7/01/2016, Brandes’ bill (SB 1534) takes effect, massively reforming Florida’s civil asset forfeiture practices.

What Amazon does is reminiscent of civil asset forfeiture. In theory, one could apply one bad gift card to their account—perhaps received as a birthday gift or from a web donation—and end up forfeiting their entire gift card balance. Amazon encourages maintaining large gift card balances through offers such as their current “Buy $100, get $5” offer, obviously because resting gift card balances help maximize their free cash flow. Thus, they may be complicit.

Essentially, the takeaway for Elliott.org commentators and others is that the counterparty risk for resting Amazon gift card balances is alarmingly high. Since Amazon gift cards are typically acquired at close to 100% of face value, their counterparty risk needs to be very close to zero for them to be a good medium of exchange in countries with reliable banking systems such as the United States. Since banks typically pay no interest, it would be unwise to keep your money in a bank that had even 0.01% risk of balance forfeiture. Americans do not typically have to worry about bank defaults thanks to FDIC insurance. There is no similar insurance for your Amazon gift card funds. Therefore, Amazon gift cards should be avoided by gift-givers and for online trades. Recipients of Amazon gift cards should warn the sender about Amazon and should redeem their gift cards quickly to reduce risk of forfeiture.

Amazon Jolly Roger

Amazon and Labor Laws

Amazon and Labor Laws (satire)

Labor laws? We don’t need no stinkin’ labor laws (Soper, 2011; Kantor & Streitfeld, 2015)!

Jeff Bezos, CEO
Amazon.com, Inc.

Satire. Not a quote of Jeff Bezos. Jeff Bezos probably keeps these thoughts to himself and his Senior Vice Presidents.

References

Soper, S. (2011, September 18). Inside Amazon’s warehouse. The Morning Call. Retrieved February 8, 2016, from http://www.mcall.com/news/local/amazon/mc-allentown-amazon-complaints-20110917-story.html

Kantor, J., & Streitfeld, D. (2015, August 15). Inside Amazon: Wrestling big ideas in a bruising workplace. The New York Times. Retrieved February 8, 2016, from http://www.nytimes.com/2015/08/16/technology/inside-amazon-wrestling-big-ideas-in-a-bruising-workplace.html

Photo by Asa Mathat.