Amazon Arbitration: How It Works & Why Sellers Don’t Like It

Becoming a seller on Amazon was likely a huge step for your business, and you were probably eager to sign the paperwork and get started. However, that paperwork contains a provision that states you forfeit your right to sue Amazon should a dispute arise. Instead, you are agreeing to submit the dispute to binding arbitration. Our Amazon seller lawyer explains how the Amazon arbitration process works and why so many sellers dislike it.

How the Amazon Arbitration Process Works

If you have a dispute with Amazon and you have exhausted the appeals process, you may request arbitration to resolve the issue. All arbitration with Amazon is governed by the rules of the American Arbitration Association (AAA). Your arbitrator may be a former federal or state judge, an attorney with exceptional expertise in the issue at-hand, or another professional who understands the issue in dispute.

First, you will need to issue a “Demand for Arbitration,” which notifies Amazon and the AAA of the dispute and your proposed resolution. A well-crafted demand is key for your success in arbitration, so retaining an Amazon seller lawyer to prepare it for you is often a wise choice.

After you mail a copy of the demand to Amazon at the address of their registered agent as well as the AAA, Amazon’s attorneys will review your claims. At this point, your claim may be settled if Amazon’s attorneys determine that your demand is reasonable.  However, if it remains unresolved, it is time to choose, with the agreement of Amazon, an AAA arbitrator to hear your dispute. Once it is heard, the arbitrator will issue a binding decision.

Problems With the Process

There are several reasons why Amazon sellers do not like the Amazon arbitration process. For some sellers, the fact they are not able to pursue litigation is upsetting. For others, they do not like how intense the arbitration process is and how costly it can be. Many small businesses simply do not have the time, money, or inclination to go through the Amazon arbitration process.

Alternatives to the Amazon Arbitration Process

Because our clients were unhappy with the binding arbitration process required by Amazon, we created an alternative solution which we call Synthetic ArbitrationⓇ, or “SynArbⓇ“ for short. It is less costly and works more swiftly than traditional arbitration, and it is available exclusively to our clients at ESQgo. If you are interested in learning more, see our page that describes the process, and then contact an Amazon seller lawyer at our firm.

Have an Amazon Seller Lawyer On Your Side

If you are a seller involved in a dispute with Amazon, you need help from professionals who understand how the process works and can explain your options to you. Contact our firm to speak with an Amazon seller lawyer that will guide you step-by-step. Contact us via our contact page.