Online marketplace Kogan.com fleeced by US supplier

A mysterious US supplier running a fashion export business from his Beverly Hills home took more than $US230,000 from Kogan.com but never supplied the goods.

Kogan.com founder and chief executive Ruslan Kogan is suing over ‘unjust enrichment’. Picture: Aaron Francis

Kogan.com is again pursuing a US supplier for hundreds of thousands of dollars for merchandise that never turned up, with the online retailer continuing to pay the supplier even after previous shipments never arrived or were missing items – and in one case accidentally paying for the same order twice.

Court documents lodged with the United States District Court of California detail a bizarre series of events beginning in late 2020, involving a US businessman called Harish “Harry” Chatlani who runs a global footwear and apparel export operation from his home in Beverly Hills, California.

After an initial order of goods was paid for but did not arrive and no refund was provided, Kogan.com kept on booking and paying tens of thousands of dollars for even more shipments.

It paid upfront and continued to order goods at least eight times despite each shipment missing items or not arriving at all.

In one case Mr Chatlani cancelled an order worth $US50,000 ($76,500) before it was shipped, after being paid by Kogan.com, and then refused a refund.

Chief executive Ruslan Kogan, the founder of the $600m Kogan.com, personally intervened to retrieve more than $US230,000 from Mr Chatlani, messaging him and trying to arrange a phone call to settle the matter.

Mr Chatlani dodged the calls and his whereabouts are unknown.

Mr Chatlani’s company, Pacific Link Traders LLC, had a long-standing relationship with Kogan.com, the court documents explain.

It was Kogan.com’s practice to place orders via email and pay for 100 per cent of the goods upfront.

It is not known whether these extremely generous terms are ­extended to other Kogan.com suppliers.

Kogan.com is suing Mr Chatlani’s Pacific Link Traders, claiming the US supplier has been “unjustly enriched at Kogan’s ­expense”.

It isn’t the first time Kogan.com has been allegedly fleeced by a US supplier.

Last year The Australian reported that a businessman called Dov Zaetz was paid as much as $1.5m by Kogan.com to supply sneakers that never arrived. Mr Zaetz operated his global sneakers export business from a small apartment in the Crown Heights section of Brooklyn, New York.

This time Mr Kogan has became personally involved in the matter, court documents reveal. Mr Kogan messaged Mr Chatlani over WhatsApp to retrieve $US232,262 and ask for a telephone call. Those calls were avoided by Mr Chatlani.

It was only then that Kogan.com took Mr Chatlani to court. But when a process server turned up at Mr Chatlani’s residence in Beverly Hills a woman answered the door and said Mr Chatlani “was out of town and would not return for four weeks”.

In a letter to Kogan.com’s lawyers, Mr Chatlani also said he was “going to be travelling for approximately two months” and would respond to the matter “in due time”.

The saga began in December 2020 when Kogan.com paid Pacific Link Traders $US27,375 for merchandise. When the shipment arrived, $US3439 worth of goods were missing. No refund was provided.

Nonetheless, soon after Kogan.com paid $US176,120 for purchases, but Pacific Link Traders failed to deliver $US10,971 worth of goods.

In November 2021, Kogan.com paid $US65,591 and $US65,082 for two invoices. Two months later, Kogan.com inadvertently made two more payments on the invoices of $US67,126 and $US66,541.

“Despite the obvious error, Pacific Link Traders accepted the payments and made no offer to refund Kogan,” the court documents said.

But the business relationship continued. In March 2022 Kogan.com placed another order, paying $US109,923, but $US7391 worth of merchandise was missing from the shipment. Not put off by this, Kogan.com paid $US49,715 upfront for goods but this time Pacific Link Traders cancelled the order and refused to pay a refund. In August 2022 Kogan.com paid $US60,440 but $US12,302 worth of merchandise missing from the shipment.

In December 2022, Kogan paid $US111,731 but $US1207 worth of merchandise was missing. In March 2021 there was an order from Kogan.com for €694,008 ($1.145m) of goods but €12,628 worth of goods were missing.

In total Kogan.com paid $232,262.32 for goods that were not shipped by Pacific Link Traders or received by Kogan.com.

“Since September 2021, Kogan has made multiple payments to Pacific Link Traders for orders that were either not fulfilled or cancelled, and in one instance, mistakenly paid for an order twice.

“Pacific Link Traders has been unjustly enriched at Kogan’s expense, and it would be unfair to allow Pacific Link Traders to retain such enrichment without compensating Kogan,” the court documents state.

A spokesman for Kogan.com declined to comment on the ­matter.