Seller Account Health and Suspensions on Amazon and Walmart: Navigating the Risks and Protecting Your Business

In the world of eCommerce, selling on marketplaces like Amazon and Walmart offers tremendous opportunities — and equally daunting risks. One of the biggest headaches for third-party sellers is maintaining healthy account performance and avoiding suspensions, particularly for issues like intellectual property (IP) complaints, counterfeit accusations, or performance metrics like late shipments and order cancellations.

Unfortunately, the experience many sellers have when dealing with account health concerns on these platforms can be frustrating. Amazon, for example, is infamous for its outsourced, script-reading support teams and opaque account suspension processes, while Walmart’s Seller Center often leaves merchants guessing about performance drops.

In this post, we’ll unpack the most common account health issues for both platforms, explain what causes them, and — most importantly — outline actionable strategies to resolve account suspensions and protect your business. We’ll also answer key legal questions sellers frequently ask, like whether you can sue Amazon or how to address IP alerts from aggressive competitors.

Why Seller Account Health Matters

Before we dive into the specific issues, it’s worth restating why seller account health is so vital. On Amazon and Walmart, your account health score and performance metrics directly impact your:

• Ability to continue selling
• Buy Box eligibility
• Seller ranking
• Product listing visibility
• Access to premium programs like Walmart 2-Day Delivery or Amazon Seller Fulfilled Prime

Ignoring account health warnings can lead to suspensions, listing removals, or even permanent account deactivation. Worse still, account reinstatement is neither easy nor guaranteed, making prevention and a proactive strategy essential.

The Most Common Suspension Triggers

Let’s look at the leading causes of account suspensions and performance issues for both Amazon seller accounts and Walmart Marketplace.

Top Amazon Seller Suspension Reasons

Inauthentic Product Complaints

• Buyers or rights owners report receiving items they believe aren’t authentic.
• Amazon often acts without verifying the claim’s validity.

Intellectual Property (IP) Complaints

• Brands or competitors file claims for trademark, patent, or copyright infringement.
• These can be legitimate or malicious (competitor sabotage).

Counterfeit Accusations

• Claims that your product is counterfeit, usually triggering instant listing removals or Amazon account suspension.

Performance Metrics Violations

• Late shipment rate, order defect rate (ODR), and valid tracking rate falling below thresholds.
• Typically triggered by fulfillment issues or customer complaints.

Walmart Marketplace: Top Performance Issues

Seller Scorecard Metrics

• On-Time Delivery Rate (OTD), Order Defect Rate (ODR), and Cancel Rate are closely monitored.
• Walmart’s system is less transparent than Amazon’s but similarly punitive.

Policy Violations

• Listing prohibited items, incorrect product information, or breaching Walmart’s pricing policies.

Customer Complaints

• Negative feedback or reviews
• Reports about poor item quality, authenticity, and fulfillment problems
• Poor customer experience

Why Seller Support Frustrates Sellers

Both Amazon and Walmart rely heavily on outsourced, offshore seller support teams. These teams follow strict scripts and often lack the authority or understanding to resolve nuanced seller issues.

Amazon’s infamous Seller Performance Team (which makes Amazon account suspension decisions) is email-only and inaccessible via phone, while Walmart’s support channels are often slow to escalate serious matters.

This disconnect leaves sellers frustrated, leading many to explore legal recourse or third-party appeal services.

How to Appeal an Amazon Account Suspension for Inauthentic Complaints

If your Amazon suspends your seller account for inauthentic complaints, here’s how to approach the appeal process:

1. Identify the Problem Listings

Check your Account Health dashboard in Amazon Seller Central to see which ASINs are flagged.

2. Gather Authenticity Documentation

You’ll need to gather the following documents so Amazon can verify information:

• Invoices from authorized suppliers (dated within 365 days).
• Supplier contact information.
• Purchase orders and delivery receipts if available.
• Business and personal identity verification.

Pro tip: Ensure the invoices include matching details to your Amazon account (company name/address) and are itemized with product names/SKUs.

3. Draft a Persuasive Plan of Action (POA)

A POA is mandatory and should follow this structure:

• Root Cause: Briefly explain what led to the complaint.
• Corrective Actions: What you’ve done to address the issue (e.g., removed problematic inventory, contacted the supplier, retrained staff).
• Preventative Measures: What you’ll do to prevent recurrence (e.g., sourcing only from vetted suppliers, implementing a stricter product check process).

Avoid blaming customers, Amazon, or using emotional language. Be factual, concise, and proactive.

4. Submit via the Account Health Page

Upload your POA and invoices where prompted, then wait for a response (typically within 72 hours).

What Causes Walmart Seller Performance Drops (And How to Fix Them)

Walmart’s seller performance system uses a scorecard-based system to track key metrics. Drops can occur for several reasons:

Common Causes:

• Late order confirmations or shipments
• High cancellation rates (including running out of stock)
• Order defects like negative reviews or customer claims
• Listing violations or restricted product listings

How to Address It:

Review Your Scorecard Weekly: Check your Seller Center dashboard for flags.

Improve Fulfillment Processes: Integrate with reliable shipping and inventory management tools to automate order confirmations and tracking uploads.

Proactively Communicate with Buyers: Respond to buyer messages and disputes quickly to avoid escalations.

Use Walmart Fulfillment Services (WFS): If order fulfillment or delivery times are causing issues, consider using WFS for better shipping metrics.

Appeal Unfair Defects: Dispute any ODR or policy violations you believe are incorrect through the Seller Help portal.

Can You Sue Amazon for Wrongful Deactivation, or Is Arbitration the Only Option?

One of the most common legal questions sellers ask is whether they can sue Amazon for wrongful account deactivation. Unfortunately, the answer is complicated.

Amazon’s Business Services Agreement Requires Arbitration

Almost every Amazon seller agrees to mandatory binding arbitration when they sign up, meaning disputes cannot typically be litigated in court.

Arbitration is a private legal process handled by a neutral arbitrator (usually through the American Arbitration Association). It can be faster than court but also costly, typically involving filing fees, legal representation, and arbitrator compensation.

When Arbitration Makes Sense:

• If your account was wrongfully deactivated without cause.
• If Amazon held your funds unfairly.
• If repeated IP complaints were baseless but led to financial loss.

Some sellers have won substantial arbitration awards or negotiated settlements via this route, though it often requires specialized legal counsel.

Exceptions:

If an Amazon suspension claim involves consumer protection, criminal conduct, or class-action suits, different legal routes may apply, but these are rare.

Pro tip: Before considering arbitration, exhaust Amazon’s internal escalation channels (including Executive Seller Relations or Amazon Legal).

How to Handle IP Alerts or Counterfeit Claims from Competitors

Unfortunately, IP complaints are sometimes weaponized by unscrupulous competitors to knock listings offline. Here’s how to defend against them:

1. Understand the Nature of the Complaint

Is it a trademark, patent, or copyright claim? Was it submitted by a legitimate rights owner?

You can usually check the complainant’s details in the Account Health dashboard.

2. Respond Strategically

• If the claim is valid: Remove the listing and work with the rights holder for a retraction.
• If the claim is baseless or from a competitor: Gather evidence (invoices, authorization letters, brand registry screenshots) and submit a counter-notice or appeal via Seller Performance.

Pro tip: In cases of bad-faith competitor claims, document everything and consider consulting a seller attorney or brand protection service.

3. Improve Brand Protection

If you own your brand:

• Enroll in Amazon Brand Registry.
• Monitor listings for hijackers.
• Use transparency programs or serialization to track inventory.

If you’re a reseller:

• Source only from authorized distributors.
• Keep records of all supplier correspondence and transactions.

Conclusion

Seller account health on Amazon and Walmart is a high-stakes game — one where a single complaint, delayed shipment, or competitor’s bad-faith IP claim can jeopardize your selling privileges and your business.

If account suspension ever happens to you, here are key takeaways to ensure you are successful in the reinstatement process and remain in good standing:

• Keep thorough documentation for every product and transaction.
• Learn how to draft effective appeal letters for suspensions.
• Don’t hesitate to escalate serious issues through legal or arbitration channels when appropriate.
• Be proactive in monitoring your seller account health dashboards.

While Amazon’s seller support system and Walmart’s opaque processes can be maddening, understanding how to work within these structures — and when to push back — is the key to long-term eCommerce success.

Need Help with a Suspension or Account Health Issue?

Consider working with a professional eCommerce attorney, suspension appeal specialist, or brand protection firm. Proactive prevention and expert guidance can save you months of lost sales and stress.