Marketplace Platform Account Suspension Demand Letters

• Read suspension notice: Identify exact reason stated (vague “TOS violation” vs. specific claim)
• Preserve evidence: Download messages, orders, reviews, payment records, inventory reports
• Review TOS: Understand what you allegedly violated
• Identify funds at risk: How much is pending/held? What is stated release timeline?
• Check linked accounts: Platforms may suspend related accounts (same owner, household, business)
• File internal appeal ASAP: Most platforms require exhaustion of internal appeals before legal action

Upwork:

• Respond via ticket system or email support directly
• Provide evidence of legitimate work, client communications, deliverables
• If “off-platform payment” allegation: explain any mentioned external tools (GitHub, video calls, etc.)
• Escalation: Request supervisor review; cite ToS sections showing compliance

Amazon Seller Central:

• Submit “Plan of Action” (POA) addressing: root cause, corrective actions, preventive measures
• Be specific: admit any legitimate issues, explain what you fixed
• Provide invoices, supplier info, product authenticity proof if counterfeit claim
• Address all performance metrics cited (ODR, late shipment rate, etc.)
• If denied: Revise POA and resubmit (can take 3-5 iterations)

eBay:

• Call eBay suspension department (automated appeals often fail)
• Provide evidence: tracking numbers, supplier invoices, authenticity certificates
• If “linked account” suspension: prove no connection or that linked account was legitimately separate business
• Request MC011 restriction review if applicable

Etsy:

• Email integrity@etsy.com with appeal
• If copyright claim: File DMCA counter-notice if you believe claim is false
• If “reselling” allegation: Prove you made/designed items (process photos, materials receipts)
• Etsy appeals rarely succeed; focus on fund release if reinstatement denied

Fiverr:

• Submit ticket through support center
• If quality complaints: Show client satisfaction, completed work, reviews
• If TOS violation: Clarify misunderstanding, commit to compliance
• Escalation path limited; Fiverr rarely reverses permanent bans

If platform denies appeal or doesn’t respond within reasonable time:

• Demand letter: Formal legal demand alleging breach of contract, bad faith, conversion of funds
• Arbitration threat: Cite arbitration clause; state intent to file if not resolved
• Focus on funds: Even if reinstatement unlikely, demand immediate release of withheld earnings
• Regulatory complaints: File with FTC, state AG, BBB (limited impact but creates record)
• Alternative platforms: Don’t wait for resolution; establish presence on competing platforms immediately

• Upwork: Typically releases funds after 90-180 days if no fraud claims pending
• Amazon: Withholds funds pending resolution; may hold longer if authenticity/safety issues
• eBay: Varies; may hold funds 30-90 days depending on claim type
• Etsy: 180-day automatic hold; releases if no outstanding cases
• Fiverr: Holds revenue for 14-30 days; extended if disputes pending

Platforms have valid business and legal reasons to suspend accounts:

• Fraud prevention: Protect buyers/clients from scams, counterfeit products, non-delivery
• Marketplace integrity: Enforce quality standards, authenticity requirements
• Legal compliance: Remove prohibited items (illegal goods, IP infringement, regulated products)
• Risk management: Suspend accounts linked to chargebacks, disputes, customer complaints
• Platform reputation: Low-quality sellers/freelancers harm platform brand and user trust

When user challenges suspension via demand letter or arbitration:

• Document specific violations: Screenshots, transaction data, customer complaints, policy violations
• Show TOS compliance: Suspension followed stated policies; user had notice of rules
• Demonstrate review: Human reviewed evidence (not purely automated); considered user’s appeal
• Justify fund hold: Ongoing disputes, chargeback exposure, refund claims justify holding funds
• Cite Section 230: Platform not liable for third-party content (if relevant)
• Arbitration advantage: Force expensive arbitration; user often lacks resources to pursue

• Broad TOS language: “We may terminate at any time for any reason” = near-absolute discretion
• Independent contractor relationship: Users not employees; no wrongful termination claim
• Legitimate business reason: Suspension based on performance metrics, customer complaints, fraud indicators
• No property right in account: User has no vested right to continue using platform
• Reasonable fund hold: Withholding funds pending chargeback/dispute window is standard practice

Platforms face higher litigation risk when:

• Automated suspensions without review: Algorithm-driven bans of high-value accounts
• Vague or no explanation: Refusing to specify violation makes bad faith claim easier
• Denying appeals without review: Auto-rejecting appeals without human examination
• Extended fund holds without justification: 180+ day holds when no disputes/chargebacks pending
• Linked account suspensions: Banning unrelated accounts based on tenuous connections (same IP, household)
• Destroying inventory without notice: (Amazon) Disposing of FBA inventory without giving seller option to retrieve

Most marketplace agreements require arbitration:

• Upwork: AAA arbitration; filing fee $200-$2,000 depending on claim amount
• Amazon: Arbitration required for claims over $50,000; small claims allowed for smaller amounts
• eBay: Binding arbitration via AAA
• Etsy: Arbitration clause in Terms of Use (as of recent updates)
• Fiverr: Arbitration required; opt-out window within 30 days of account creation

For withheld funds under state limits:

• California: $10,000 limit (perfect for many Upwork/Etsy fund holds)
• New York: $5,000 limit (small claims) or $10,000 (commercial claims court)
• Texas: $20,000 limit (justice court)
• Strategy: Sue for conversion (wrongfully withheld funds); many platforms don’t defend small claims vigorously
• Service of process: Serve registered agent in your state or platform HQ
• Default judgment: If platform doesn’t respond, obtain default and enforce collection

Marketplace suspensions may support class actions if:

• Pattern of wrongful suspensions: Platform systematically suspends accounts without cause
• Automated decisions without review: Algorithm-driven bans affecting thousands of users
• Common legal theory: All class members harmed by same policy (e.g., 180-day fund holds)
• Class action waiver challenges: Some jurisdictions find class waivers unconscionable in adhesion contracts

• Arbitration cost: Platform’s legal defense costs $20k-$50k; early settlement cheaper
• Publicity risk: Media coverage of wrongful suspensions harms platform reputation
• Regulatory scrutiny: FTC investigating marketplace practices; complaints add to regulatory pressure
• High-value accounts: Users with years of history and significant earnings have stronger claims
• False positives: Automated suspensions create sympathetic fact patterns for juries/arbitrators

File complaints (in addition to legal action) with:

• FTC: Online complaint portal; FTC tracks patterns of unfair/deceptive practices
• State Attorney General: Consumer protection divisions investigate marketplace platforms
• BBB: Platforms maintain ratings; complaints may trigger executive review
• State licensing boards: (If applicable) Some platforms subject to state money transmitter laws

Users win when they show:

• Strong account history (years of positive reviews, high ratings, significant earnings)
• No actual TOS violation (false positive from automated system)
• Platform denied appeal without meaningful review
• Prolonged fund hold without justification (no disputes, chargebacks pending)
• Specific evidence contradicting platform’s suspension reason

Platforms win when they show:

• Specific TOS violations (documented policy breach, customer complaints)
• Broad discretion in agreement (“may terminate at any time”)
• Legitimate business reason (fraud indicators, quality issues, authenticity concerns)
• User had notice and opportunity to appeal
• Fund hold justified by ongoing disputes or chargeback exposure

• Analyze suspension notice and TOS to identify legal claims
• Draft and submit platform-specific appeals (Plans of Action for Amazon, etc.)
• Send formal demand letters threatening arbitration/litigation
• File and prosecute arbitration claims under platform agreements
• Pursue small claims litigation for fund recovery (under state limits)
• Negotiate settlements for partial fund release or account reinstatement
• File regulatory complaints (FTC, state AG) to add pressure
• Advise on alternative platforms and business continuity during dispute

• Defend suspension and termination decisions in arbitration/litigation
• Draft and enforce terms of service, suspension policies
• Respond to demand letters and arbitration demands
• Advise on compliance with consumer protection laws, Section 230
• Develop appeals processes that reduce false positives and litigation risk
• Defend class action claims challenging suspension practices

• Platform appeal drafting: Flat fee ($500-$1,500 for POA, Upwork appeal, etc.)
• Demand letter: Flat fee ($1,500-$2,500)
• Small claims representation: Flat fee ($1,000-$2,000) or contingency (33%)
• Arbitration: Hybrid (flat fee for filing + hourly for hearing) or contingency for high-value cases (33-40%)
• Contingency basis: Available for strong cases with $10k+ in withheld funds

• Upwork suspension ($85k withheld) – arbitration resulted in full fund release + $30k damages
• Amazon Seller account suspension – successful POA appeal, account reinstated with $200k inventory returned
• Etsy permanent deactivation – negotiated early release of 60% of funds (avoided 180-day hold)
• eBay linked account suspension – proved accounts legitimately separate, both reinstated
• Fiverr ToS violation dispute – demand letter resulted in warning removal, account reinstated

Book a call to discuss your marketplace suspension. I’ll review your suspension notice, evaluate your legal claims, and recommend whether to pursue arbitration, small claims, or negotiated settlement.

Email: owner@terms.law