[chrischen]

Amazon is a direct beneficiary though. I’m not sure why they are not the seller. In that case can’t they just setup shell companies to sell shoddy, fake, or illegal items, take 99% of the profit, and claim they are not the seller?

[jtbayly]

No. The primary beneficiary is the seller. If you want to sue somebody you have to sue the seller. That’s what precedent says, anyway.

Yes, Amazon could setup shell corporations, but if they got tracked back to Amazon, that would be the end of the company. Why not just setup a bunch of side businesses producing and selling legal things (like their batteries, clothes, etc. brands) and collect all the profit there, while allowing others to setup shell corporations and sell the illegal things? That way they collect some profit from the latter, but without any risk to the company. And, in fact, that’s what they do.

[smichel17]

[Hypothetical] If I buy a legitimate product from a legitimate seller, and end up with a counterfeit due to commingling, I don't see any reasonable story for how anyone but Amazon should be liable for that. They substituted the product I ordered with an inferior one.

And then, of course, Amazon should turn around and sue whoever provided them the counterfeit product. But the first level of culpability is still with Amazon.

It's like if I'm driving, waiting at a red light, and someone rear-ends me, causing me to rear-end the car in front of me. The person I hit sues me, wins, and I turn around and sue the person behind me for both the damage to my car and whatever I lost in the first lawsuit (probably all via insurance).

[chrischen]

I guess that latter situation is my point. Even if they are not the primary beneficiary they are a large beneficiary of all these illicit products. I'd imagine that they are probably not a minor beneficiary either since they probably get a huge chunk of the sale off these mostly commodity products. For each cheap plastic widget they sell probably the majority goes to advertising + Amazon Prime + warehousing + shipping + customer support, and I'd imagine the actual a manufacturer gets the short end of that stick.

[jtbayly]

I agree that it’s horrible, but I only wanted to explain that lawsuits have already been tried many times.

[numpad0]

Doing profitable activities illegal if done by ____, by saying “we do not consider ourselves to be ____” is the core of the business model for companies like Amazon or Uber

[user5994461]

>>> No. The primary beneficiary is the seller.

New angle for the next trial: Amazon started taking double digits percentages of every sale and doing FBA in the past few years.

For physical products (consider thin margins after manufacturing costs), that means Amazon earns more money than the seller, thus they are the primary beneficiary of the sale.