Amazon is asking Chicago federal judges to pause payments in trademark cases
/Amazon is asking Chicago federal judges to pause payments in trademark cases over concerns that some lawsuits may be used to unlock previously frozen seller funds.
One detail stands out: Amazon says certain settlements matched the frozen account balances to the penny.
“Schedule A” lawsuits typically involve an intellectual property owner, such as a trademark, copyright, or design patent owner, suing numerous online sellers, seeking emergency account freezes, and obtaining settlements or default judgments followed by orders transferring funds.
Amazon’s lead filing, in NextClimb Investments, LLC v. Schedule A, No. 1:26-cv-05593 (N.D. Ill.), questions whether that process is being used to bypass existing restrictions on seller accounts. In later filings, Amazon said it has reason to believe some merchants, or people acting for them, are using Schedule A cases to pay frozen funds to themselves and get around other enforcement actions.
Amazon has sought stays in at least two other trademark cases, including NextClimb’s No. 1:26-cv-04669 and Chen v. Schedule A, No. 1:26-cv-05339, while it investigates further. In Chen, Amazon said it was not asking the court to decide whether the concerns apply there at this point.
Amazon’s public filings identify several warning signs:
Funds Amazon says it had restricted before the lawsuit for unrelated enforcement reasons.
Settlements Amazon says matched restrained balances to the penny in some cases.
In a case over a mark registered for HVAC vent covers, defendants Amazon says sold products such as Christmas ornament kits and boots.
One attorney appearing for all 100 defendants at once, which the judge said “raises as many questions in the Court’s mind as it answers.”
In the 5593 case, Judge Kennelly has stayed the transfer of $711,529.44 from 100 seller accounts. Stays have since been granted in the other two cases as well. In the 4669 case, NextClimb did not oppose the stay. In Chen, the plaintiff filed a satisfaction of judgment, waived any further payment from Amazon, and asked the court to deny the stay as moot; the court granted the stay. Amazon’s filings also cite concerns from attorneys representing other trademark owners whose cases involved some of the same restrained accounts.
Amazon says it has identified at least 16 NextClimb cases filed in the district between March and July 2026. According to figures another attorney reported to Amazon, four of those cases alone produced orders to transfer about $4.67 million from 435 seller accounts.
Amazon plans to file additional information by October 19. NextClimb and the defendants have not yet responded to Amazon’s motion; their responses are due October 20, with a hearing set for October 28.
Note: The court has not yet ruled on the issues Amazon raised, and the stays themselves are not findings of wrongdoing.
#ScheduleA #TrademarkLaw #IntellectualProperty #Amazon
