Attorney for ex-Amazon Seller Urges Denial of Amazon’s Motion for Rule 11 Sanctions

The counsel for a former Amazon third-party seller urged the U.S. District Court for Southern New York in Manhattan to deny Amazon’s Jan. 11 motion for Rule 11 monetary sanctions against her for submitting legal arguments she knew to be frivolous (see 2401120032), said her opposition Friday (docket 1:23-cv-03334).

The seller, Shenzhen Zongheng Domain Network, sought to vacate an arbitration award in Amazon’s favor and to recover the $508,000 in sales proceeds that Amazon seized, and the arbitrator let Amazon keep, when it deactivated Zongheng’s account for manipulating customer product reviews (see 2305080023). U.S. District Judge Jennifer Rochon rejected the remand motion (see 2307210035) and ultimately denied the vacatur petition itself (see 2311090003). Zongheng’s motion for reconsideration of that denial is pending (see 2312140032).

Attorney Julie Guo of JS Law Office was "admonished" by another SDNY judge in a separate arbitration case she brought against Amazon “about the lack of any basis” for her motion to remand her client’s vacatur petition to New York Supreme Court, said Amazon's motion. But in an example of “blatant forum shopping,” Guo “thought it appropriate to take a shot” with the same motion to remand before multiple other SDNY judges, including in the Zongheng proceeding, said Amazon. It seeks an award of monetary sanctions against Guo in the amount of Amazon’s attorneys’ fees and costs incurred in opposing Zongheng’s motion to remand, it said.

Guo has filed no remand motions in the past six months on behalf of various former Amazon sellers she represents, said her opposition. Yet Amazon filed a Rule 11 sanctions motion Jan. 11, it said. If there’s any conduct in this litigation that merits sanctions, it would be Amazon's “unreasonable and vexatious multiplication” of the proceedings in this case by filing a “frivolous” motion for sanctions, it said.

Amazon’s motion for sanctions “knowingly misrepresents both the law and the facts, solely to harass, intimidate and bully these small sellers” and their counsel, JS Law Office, “a boutique law firm that represented these sellers in these court actions on a nearly pro bono basis,” said Guo’s opposition. Zongheng has no interest in wasting the court’s time with a counter-motion for sanctions, it said.

But the court must observe that Amazon’s “alleged legally frivolous motion would more appropriately describe Amazon's own groundless motion for sanctions than Zongheng’s well-taken and early phase practice” of its motion to remand, said the opposition. Amazon should also be “condemned for its abuse of the legal system” by forcing more than 55,000 small sellers out of affordable class actions in the arbitration into "the more expensive arbitration on an individual case basis,” it said.

Amazon did so to thwart the sellers’ access to judicial remedies and to burden the court, said the opposition. It especially did so under the context that Amazon “abruptly deactivated” the sellers’ accounts and seized their entire sales proceeds, it said. Amazon also removed their selling capacities and access to their own funds, leaving them with almost no available funds to pay the arbitration costs, it said.