United States v. Amazon Inc

What this document decided

This was an endorsed letter and scheduling order, not a decision on Amazon’s anticipated motion to stay discovery or its pending motion to dismiss. The court directed Plaintiffs-Relators to respond by November 19, 2024, and scheduled a telephonic pre-motion conference for November 22, 2024, at 11:00 a.m.

Background

The Plaintiffs-Relators brought claims under the False Claims Act against Amazon.com, Inc., Amazon Fulfillment Services, Inc., and Amazon.com Services, LLC, which the letter collectively calls “Amazon.” The United States declined to intervene on October 16, 2023. The Plaintiffs-Relators then amended their complaint twice. According to Amazon’s letter, the Second Amended Complaint alleges that Amazon was responsible for allegedly false statements made on customs forms and declarations by third-party entities that imported, listed, and offered products for sale through Amazon.com. The letter states that those third-party sellers’ sales occurred after the import process and after the alleged false statements.

The letter also states that the Plaintiffs-Relators originally named the third-party sellers as defendants but later dismissed them. Amazon filed a motion to dismiss on May 31, 2024, citing Federal Rules of Civil Procedure 8(a), 9(b), and 12(b)(6). The opinion text does not state that the court had ruled on that motion.

Amazon’s requested discovery stay

The Plaintiffs-Relators served Amazon with requests for production and interrogatories on October 18, 2024. Amazon asked to stay discovery while the motion to dismiss was pending. The parties did not agree to an indefinite stay, but the Plaintiffs-Relators agreed to extend Amazon’s deadline to respond or object to discovery by 60 days, to January 17, as stated in the letter.

Amazon argued that a stay was justified because the discovery requests sought broad categories of documents and communications and required identification of third-party sellers involved in wildlife products and fur-related goods dating back at least to January 1, 2012. Amazon also argued that the Plaintiffs-Relators would not be prejudiced because the motion to dismiss was fully briefed and could potentially resolve the entire case.

Arguments about the motion to dismiss

Amazon argued that the Second Amended Complaint failed to plead with the particularity required for fraud claims how Amazon caused third-party sellers to make false statements. It said the complaint did not allege that Amazon controlled the sellers, acted as their importer of record or customs agent, directed them to make false claims, or itself submitted false claims.

Amazon further argued that the complaint did not identify an obligation that Amazon, rather than the third-party sellers, owed the government; did not plead facts supporting a strong inference of fraudulent intent; did not adequately allege deliberate ignorance or reckless disregard; and did not plead a valid False Claims Act conspiracy because it alleged neither an agreement nor an overt act by Amazon in furtherance of the alleged conspiracy. These were Amazon’s arguments, not rulings by the court in this document.

Court action

Judge Edgardo Ramos ordered the response and set the pre-motion conference. The document does not grant or deny a discovery stay, rule on Amazon’s motion to dismiss, or resolve the Plaintiffs-Relators’ claims.