Funds Frozen for 72 Hours by a U.S. TRO: Attorney Shen Jinlong Discusses the Emergency Response Order for Shenzhen Sellers—Should Account Funds or Listings Be Protected First?

Which should you protect first, the funds in the account or the listing? My answer is: protect the funds first, but the actions must proceed on two tracks. A TRO freezes the receiving account, and once the funds are transferred out, they are basically unrecoverable; if a listing is taken down, it can still be restored through an appeal. Within 72 hours, the first priority is to prevent the transfer of funds, while delaying the listing takedown in a manner that does not provoke the plaintiff. The two tracks run in parallel, but resources should be weighted toward the funds side. I will break this down below by time point.

1. A TRO freeze and the transfer of funds are two separate matters; do not conflate them.

When many Shenzhen sellers receive a TRO (Temporary Restraining Order) for the first time, they think that having their account frozen means the money is gone. It is not. A TRO is only a temporary restraining order, usually effective for 14 days, and the court may extend it for another 14 days upon the plaintiff’s application. What actually takes the money away is the subsequent Preliminary Injunction and the enforcement proceedings after the final judgment. This means there is a window between the freeze and the transfer of funds. Cross-border payment platforms (such as PayPal, Payoneer, and Amazon store funds) generally freeze the balance after receiving a court order, but they will not directly transfer funds at the TRO stage. This distinction determines your order of emergency response: first prevent the TRO from being converted into a preliminary injunction, then discuss the link.

II. 72-Hour Action Checklist, and the Order Must Not Be Changed

First, take screenshots to preserve the account freeze notice, platform emails, and TRO documents (if any). Second, immediately find out who the plaintiff is, what the case number is, and which court it is in—most U.S. TRO cases are concentrated in the Northern District of Illinois (N.D. Ill.). Third, do not use the store registration email to contact the plaintiff’s attorney directly. Many clients, encountering this for the first time, rush to send emails to explain, only to have the other side treat them as evidence of admitting infringement. Fourth, contact an attorney licensed to practice in the United States to assess whether to defend or settle. In practice, the most valuable action within 72 hours is to have a lawyer determine whether the case is worth defending or whether negotiating a settlement directly is more cost-effective. Defense costs can easily run into tens of thousands of dollars, while in many small freeze cases the settlement amount is between 30% and 50% of the frozen amount.

III. The response deadline is only 21 days; an extension is possible, but it comes at a cost.

After receiving a TRO, the defendant’s deadline to respond to a motion for a preliminary injunction is generally 21 days after receipt of notice (under Rule 65 of the Federal Rules of Civil Procedure). An extension may be requested, but the court will not necessarily grant it, and the extension request itself will incur attorney fees. We generally advise: if you decide to settle, do not stubbornly delay on the response deadline, because if you delay too long, the plaintiff will directly move for a preliminary injunction, at which point the risk of funds being transferred increases sharply. If you decide to defend, you must file a memorandum opposing the preliminary injunction within 21 days. This deadline is far more urgent than a link takedown—after a link is taken down, you can pursue a platform appeal, but once funds are transferred out, there is basically no room for maneuver.

IV. Link Takedown Can Actually Wait

When Amazon, eBay, and other platforms receive a TRO, they will remove the accused listings. However, platforms’ handling logic differs from that of courts: platforms usually conduct only a formal review, and if you submit a non-infringement statement or proof of authorization through the platform’s appeal channel, there is a chance of reinstatement. Moreover, removal of a listing does not mean destruction of inventory; the goods in the FBA warehouse are still there. So in terms of priority, the listing is secondary. The premise is that your store has not also been found by the platform to have committed fraud or repeat infringement; in that situation, the appeal success rate is much lower. This area involves the intersection of platform rules and intellectual property, and you can refer to our compiled practical materials on overseas intellectual property.

V. How to Negotiate a Settlement Amount: Lower Is Not Always Better

Settlement negotiations in U.S. TRO cases follow a standard playbook. Plaintiff’s counsel usually opens at a percentage of the frozen amount; the first offer may be as high as 70%–80%, while final settlements commonly land at 30%–50%. But this is not absolute—it depends on the type of infringement (trademark, copyright, and patent cases differ greatly), sales records, and whether the infringement was willful. In trademark cases, if the plaintiff holds a federal registered trademark, the room for negotiation is relatively limited; in copyright cases involving images or designs, you need to assess whether your use constitutes fair use. When negotiating a settlement, the payment schedule and the timing for lifting the freeze must be written into the settlement agreement. Do not pay first and get the freeze lifted afterward. We generally advise clients to specify in the agreement that within X business days after the plaintiff receives payment, the plaintiff shall file a motion with the court to dismiss the case or lift the freeze. This provision is more important than the settlement amount itself.

Six, whether to defend or settle, look at three numbers.

The first number: the frozen amount. If it is below USD 5,000, defending the case is usually not economically viable. The second number: the store’s historical sales and future expectations. If this store is your main source of revenue, it is worth investing in defending the case. The third number: the plaintiff’s litigation history. Some plaintiffs engage in mass enforcement, with the same law firm suing hundreds of sellers in the same court; such cases settle efficiently and the settlement amounts are predictable. In practice, settlement amounts in mass cases are often lower than those in individually filed cases. The specific strategy should be determined based on the facts of the case; you may contact Attorney Shen Jinlong of our firm for a preliminary assessment.

Seven, prevention is much cheaper than response.

The basis for a U.S. TRO is usually intellectual property infringement. On trademarks, a trademark registered with the USPTO (United States Patent and Trademark Office) has a 10-year term, but a Section 8 declaration of use must be filed in the 5th–6th year, and Section 8 and Section 9 renewals must be filed in the 9th–10th year. Many sellers only focus on whether they have registered their own marks and overlook conducting FTO (freedom to operate) searches when selecting products. On copyright, although registration with the USCO (U.S. Copyright Office) is not a prerequisite for filing suit, registration allows a claim for statutory damages of up to $150,000 per work, which is also why plaintiffs like to use copyright cases to initiate TROs. For cross-border patent and trademark portfolio planning, refer toIntellectual property legal services in the United States and the European Union.the process description therein. The EU and UK markets also have similar temporary injunction mechanisms, which sellers operating multiple sites should also take into account.

8. After the account is unfrozen, there are still loose ends to deal with.

After a settlement or withdrawal of the lawsuit, the court will issue an order lifting the freeze, but platform enforcement takes time, usually 3–10 business days. During this period, do not rush to withdraw all funds; some platforms will keep an observation period. In addition, if the same plaintiff still has cases against you in other courts, the unfreezing may only be temporary. It is advisable to conduct a comprehensive intellectual property review after unfreezing and keep records of how high-risk listings were handled. Foreign-related intellectual property cases are highly territorial; a U.S. court’s TRO will not automatically affect your accounts in the EU, but the plaintiff may separately seek an injunction at EUIPO or a local court. Multi-jurisdictional coordination is a matter ofOverseas intellectual propertySellers in need can learn about the scope of services in advance.

Attorney Shen Jinlong of this FirmGuangdong Zhiming Law Firm’s foreign-related intellectual property team focuses on U.S. and EU trademark, patent, and copyright matters, providing TRO response, infringement analysis, settlement negotiations, and global intellectual property portfolio services for enterprises expanding overseas and cross-border e-commerce sellers. Consultation hotline: 4008-363-555.

Disclaimer: The content of this article is general legal information sharing and does not constitute legal advice for any specific case. Court procedures and platform policies vary among U.S. states, and the outcome of an individual case depends on the specific facts and the court with jurisdiction. It is recommended that you consult a lawyer licensed to practice in the United States before taking action.