Sellers who built businesses on online marketplace Jane.com say they’re owed $10 million after site’s collapse- but have no idea how it can be recovered

Sellers who used e-commerce platform Jane.com claim they are struggling to recover the millions of dollars they are owed following the site's abrupt closure.

Documents show the Utah-based online marketplace owes more than $10.1 million in sales to more than 1,300 sellers after its closure was announced last month. NBC News reported.

Employees and sellers said they were “misled” by Jane.com, a platform once touted as an alternative to Amazon that targeted female-owned small businesses and female consumers.

The company, founded in 2011 by Megan and Michael McEwans, had stopped fulfilling orders and communicating with sellers in early October.

The shutdown has also left sellers looking for alternative platforms to sell their items, especially during the festive season.

“It was a shock,” Dana Hicks, the owner and CEO of T-shirt retailer Limeberry Designs, told NBC.

“It was hard this weekend to get through a Black Friday without the typical Jane numbers you see.”

Hicks has been selling graphic T-shirts on Jane.com since 2014 and achieved sales of more than $2 million last year, with 90 percent of those sales attributed to Jane.

She noticed delays in Jane.com's payments in October and asked the company's staff, who said the problem was due to an employee who was on leave.

Payments dropped from three or four times a week to one, she said. As of October 26, she had not received payment for more than a week.

On the same day, co-founder Michael wrote an email apologizing for the payment delays and reassuring her.

“Hi Dana, I'm sorry you are experiencing a slower payment schedule. I assure you we are doing our best to get everyone paid,” he wrote.

He mentioned a new product feature called Moments, which he said would help “drive more engagement with your products.”

“While this is not a solution to your immediate problem, I believe it will be in the long run if sellers join in and take advantage of the opportunity,” he wrote.

Founders Michael and Megan, now divorced, did not play an active role in the company's day-to-day operations.

Documents showed they each received $350,000 annually from the company until the end of 2022.

In early November, after Hicks again inquired about her payments, Jane.com paid her $40,000, part of the money owed to her.

Hicks wasn't the only seller to experience this problem, as many major sellers pulled their products from the website after the company stopped paying.

Mike Allen, co-owner of the clothing company Johnny Threads, wrote in an email: “They had stopped paying for approximately 5,000 orders shipped and delivered through early October.”

On November 17, Jane.com signed over its assets to DSI Assignments, a company that will help liquidate the company's assets to repay creditors at the Court of Chancery in Delaware, where Jane was registered.

At the time, salespeople had suspected the company was on the brink of collapse after being plagued by ghosting for weeks.

“It's been very disappointing as a small business owner. … It will devastate families,” Jen Abegg, who started selling jewelry on the platform for more than a decade, told me. the Salt Lake Tribune.

Jane's website has been down for maintenance since November 17.

Documents published by DSI Assignments show the company owes more than $10.1 million in sales to more than 1,300 sellers, including 13 who each own more than $100,000.

A private group on Facebook called “Jane Vendors Helping Each Other” has been created as vendors try to reconnect with each other and find solutions.

“This is a group where former Jane sellers come together and unite,” they wrote in the group description.

DSI said it is looking for buyers and trying to maximize the value of Jane's assets, which could help with repayments to creditors and sellers, but Allen said he is not optimistic.

“It is clear that there will be no money for us,” Allen wrote.

Two unnamed sellers have filed reports with Lehi police, but insufficient evidence has been found for criminal fraud charges, the Salt Lake Tribune reports.

DSI has asked sellers to make claims for the money they still owe by March, but there is no guarantee they will get it back as they are 'unsecured creditors' whose debts are not backed by assets.

“In most of these cases, while there is some financial negligence, it is usually not deeply criminal,” says retail expert Neil Saunders of GlobalData.

“It's just companies that don't project cash flow properly or take on too much debt and can't pay back.”