In a significant ruling that highlights the ongoing challenges of online retail regulation, a Tokyo court ordered Amazon Japan G.K., the Japanese arm of the global e-commerce giant Amazon.com Inc., to pay 35 million yen (approximately $244,000) in damages for its failure to effectively combat the sale of counterfeit goods on its platform. This decision was made by the Tokyo District Court on Friday, April 25, 2025, and marks a pivotal moment in the legal responsibilities of online marketplaces.

The case was brought forth by Try and E Co., a manufacturer of medical equipment, and its distributor, Excel Plan Co. Both companies argued that the presence of counterfeit pulse oximeters on Amazons marketplace severely impacted their sales and brand reputation. They initially sought 280 million yen in damages, but the court ultimately awarded a lesser amount to Excel Plan.

During the trial, the court scrutinized the extent of Amazon Japans obligation to monitor and regulate the products listed on its site. Presiding Judge Yuko Shintani emphasized that Amazon has a duty to implement effective measures against counterfeit products. The court found that Amazon Japan had neglected to address the issue, despite being notified about the fake listings.

The specific controversy revolved around pulse oximeters designed to measure blood oxygen levels, which are developed and manufactured by Try and E. Excel Plan, as the exclusive distributor, faced competition from counterfeit versions that were sold at approximately 10% of the price of the authentic product. The lawsuit brought to light how Amazon's promotional algorithms favor the lowest-priced items, inadvertently increasing the visibility of counterfeit goods.

Excel Plan raised concerns when it discovered that a counterfeit oximeter was being sold on the same Amazon page as its legitimate product. After reporting the issue, rather than addressing the counterfeit listing, Amazon removed the page containing the genuine product, further exacerbating Excel Plan's difficulties in selling its product.

A lawyer representing the plaintiffs commented on the ruling, stating, This is a landmark decision as it acknowledges the obligation of online platforms to develop appropriate authentication systems. Businesses have no other viable options but to utilize platforms like Amazon for their sales. This statement underscores the growing expectation for e-commerce giants to take responsibility for the content featured on their websites, particularly regarding counterfeit products that can hurt consumer trust and brand integrity.

The ruling has sparked conversations about the balance between the convenience of online shopping and consumer protection, raising questions about the responsibilities of large online retailers in the fight against counterfeiting. As online commerce continues to expand globally, the implications of this case may set a precedent for similar lawsuits in the future.