Combating Unauthorized Online Resellers

Unauthorized resellers are a growing problem for manufacturers with the rise of Internet sales and online platforms like Amazon and eBay. Unauthorized resellers buy a company’s products in bulk from third parties, generally at a significant discount, and then resell the products online. These resellers harm a company’s brand and reputation, cut into profit margins, and upset a company’s legitimate authorized resellers. KJK has developed 4-step system to thwart unauthorized resellers, which is not only innovative and efficient, but also cost effective.

  • Step 1: Prepare foundational documents. The first step is to establish enforceable legal claims against these unauthorized resellers, while overcoming the hurdle of the First Sale Doctrine. This includes drafting and implementing authorized reseller agreements.
  • Step 2: Identify Resellers. KJK has resources to identify unauthorized resellers, who often hide behind fictitious names or “storefronts.” We have experience with DMCA subpoenas that can be used to acquire the true identity and contact information for unauthorized resellers.
  • Step 3: Enforcement Process. We advise sending multiple cease and desist letters, beginning with a “friendly” first letter requesting that reseller cease its infringing conduct. The letters escalate from that point forward with the threat of legal action. This method is effective with the majority of resellers, and also helps to establish legal claims against those who continue to sell your products. This process can be rolled out in a cost-effective and efficient manner, which allows us to go after a broad swath of unauthorized resellers.
  • Step 4: Legal Action. When the cease and desist letters fail, and the rogue retailers continue to offer your products, the final step is filing a lawsuit. Many times this action will lead to default judgments against the resellers that can be presented to websites like Amazon, which will remove the seller’s listings of your products.
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