Amazon seller account blocked: LG Hildesheim issues temporary injunction against Amazon

Arno Lampmann

The Regional Court of Hildesheim recently issued a temporary injunction on 26 June 2019, ordering Amazon to immediately lift the block on a seller account, restore deleted listings and immediately release any credit balance retained in the account.

Amazon had accused the retailer of manipulating customer reviews for its products. However, he did so without providing any further justification or stating which reviews were allegedly involved and deactivated his account without warning, deleted all offers and ‘froze’ the credit on his account.

Wrongly, as the Hildesheim Regional Court has now ruled (LG Hildesheim, Beschluss v. 26.6.2019, Az. 3 O 179/19, nicht rechtskräftig, hier als PDF abrufbar). Amazon must immediately reverse all measures and probably also be liable for the loss of profit.

Amazon blocks seller account and deletes all listings

The applicant was registered as a seller on Amazon and had been generating good sales there for some time with standard, commercially available products. At the end of May 2019, the applicant suddenly received an email informing her that her Amazon.de seller account had been deactivated and all offers had been removed from the website. The credit balance (over €25,000) on her account could be withheld for 90 days or longer.

The reason for the blocking was not comprehensible

Amazon stated that the applicant had ‘manipulated’ customer reviews for its products. The reviews in question were not disclosed. As a result, the applicant was no longer able to access her account without restriction, she could not post any offers and could not access the credit to which she was entitled. Every day, she lost thousands of euros in sales without being able to justify her actions to Amazon.

LG Hildesheim orders immediate unblocking

The allegations were not true. After an out-of-court request to immediately reactivate the applicant, restore the deleted offers and also release the credit balance was unsuccessful, the Hildesheim Regional Court issued the aforementioned temporary injunction on 26 June 2019.

Accordingly, Amazon must refrain from deactivating the applicant’s Amazon.de seller account and/or removing related offers from the Amazon.de website and/or withholding credit balances from her account, subject to a fine of up to EUR 250,000.00, or alternatively a fine of up to 2 years, or imprisonment for up to 6 months.

The amount in dispute was set at €100,000 by the regional court in view of the not insignificant sales generated on the Amazon platform up to the blocking. The decision is not final and can be appealed by Amazon. In addition, Amazon also has the option of conducting proceedings on the merits.

Blocking is an encroachment on a legal position similar to ownership

The Regional Court followed the applicant’s argument that Amazon’s blocking measures constituted an existential interference with a legal position of the applicant similar to ownership, which lacked both a contractual and a legal basis. It is therefore an encroachment on a legal position similar to ownership, which must be refrained from immediately or requires the immediate restoration of the status quo.

A reason for an injunction arises from the legal concept resulting from §§ 858 ff. BGB (German Civil Code). The provisions for the protection of possession serve the purpose of preventing the entitled party from enforcing legal positions on their own initiative without recourse to the procedure prescribed by the legal system. It is therefore recognised that interim injunctions intended to counteract unlawful possession must generally order the restoration of possession and thus ultimately settle the main claim.

The situation is comparable to the case in which the landlord of a shop refuses the rightful tenant access to the premises without justification.

The terms and conditions clause according to which Amazon can block for no reason is invalid

Clause 3 of the ‘AMAZON SERVICES EUROPE BUSINESS SOLUTIONS AGREEMENT’, which governs the contractual relationship between Amazon and the sellers and in which Amazon reserves the right to terminate or suspend the agreement at any time with immediate effect and without cause, is invalid as it does not stand up to a content review in accordance with Section 307 (1) and (2) of the German Civil Code (BGB) because it unreasonably disadvantages sellers.

Antitrust judgement by a court is still pending

Of course, against the background of freedom of contract, Amazon is free to properly terminate the contract with a seller. In this case, however, Amazon would have to adhere to certain deadlines and could not simply ‘kick out’ the seller concerned, let alone retain any credit. In addition, Amazon would probably have to provide reasonable justification for the cancellation decision in light of its dominant market position and the ban on discrimination under antitrust law. However, as far as can be seen, court decisions on the subject are still pending, but will certainly not be long in coming.

Amazon liable for loss of sales

The next step for the seller is to claim compensation from Amazon for the lost sales during the period of the unauthorised blocking. The seller must of course take into account any costs saved. They are also entitled to interest payments for the period in which they were unable to dispose of the blocked credit balance.

Lawyer Arno Lampmann from the law firm LHR:

‘It is pleasing that the Hildesheim Regional Court has put a stop to Amazon’s arbitrary and, in any case, non-transparent blocking. While Amazon’s motivation to keep unreliable retailers or sellers who manipulate product descriptions or reviews off the platform as far as possible is understandable, it must also go without saying that such serious accusations should not be made out of the blue and that retailers should not be blocked without a comprehensible reason. Amazon will now have to pay for the lost profits.’

Disclosure: Our law firm represented the applicant.

UPDATE 6.7.2019

Incidentally, this is how Amazon.de ensures immediate compliance with the urgent court order:

Dear Arno Lampmann,

Greetings from Amazon Seller Support.

Firstly, please note that I fully understand your frustration regarding the issue you were facing. Unfortunately, I was unable to find a Seller Central account with the email address you used to contact us: lampmann@lhr-law.de.

To protect your seller account, we can only provide email addresses with specific information associated with that account.

If you have created your account with a different e-mail address, you can try to log in again with this e-mail address using the following link: http://sellercentral-europe.amazon.com/

If you have forgotten your password, click on the ‘Forgot your password?’ link. Then follow the instructions to create a new password. This password will work immediately.

If you have any further concerns, please do not hesitate to contact us via the following link so that we can help you with any questions you may have:
* https: //sellercentral-europe.amazon.com/cu/contact-us? ref_ = ag_contactus_shel_xx

Thank you for contacting seller support. I hope you have a great day!

Your opinion of our customer service is important to us!
Were you satisfied with the processing of your enquiry?

Let’s just say there is still room for improvement ….

UPDATE 2.8.2019

As we were informed by the Hildesheim Regional Court upon enquiry, Amazon has prevented the service and thus the enforcement of the interim injunction, which is necessary for the decision to come into force.

Details can be found here:

Amazon thwarts service of the preliminary injunction

UPDATE 13.8.2019

Amazon has, not unexpectedly, lodged an appeal against the injunction – with almost 250 pages of attachments.

It is interesting to note that the submission contained therein was apparently made in the blue without knowing the application (Amazon claims in the notice of opposition that this is not available) and largely deals with formal arguments from the defence (jurisdiction, applicable law, etc.). The allegedly failed service is also mentioned.

In contrast, the comments on the specific reason for the cancellation are limited to a few lines, in which it is not even disputed that the reason previously given for blocking the applicant, namely the ‘manipulation of product reviews’, never actually existed.

Amazon thus admits in the course of the court proceedings that – always an open secret in retail circles – companies are apparently taken into a kind of ‘clan custody’ as soon as any internal personnel connections to an unpleasant other company become known. But that’s not all. As the present case shows, Amazon does not inform the retailers concerned, but blocks them under a pretext.

Details can be found here: