By Ruth Simon
Max Medroso's nightmare started this summer when his natural skin-care business was waiting for a big shipment ordered for Amazon's Prime Day. At first, he thought, "Shipments get delayed one week, two weeks all the time."
This time was different. His $4 million shipment never arrived.
Just days after Medroso's shipment went missing, he says goods branded with his company's name -- Sky & Sol -- popped up for sale on Amazon.com at deeply discounted prices. That is what led him to believe his cargo had been stolen.
Suddenly the 25-year-old entrepreneur found himself in a maddening monthslong hunt to find the perpetrators. Medroso alternatively played the roles of detective, crusader and plaintiff. In a federal lawsuit, he laid out a group of companies that moved his goods from one seller to another with lightning speed before the goods appeared online.
Medroso had landed in the center of a booming business: cargo theft. Reports of cargo thefts have more than doubled in the last five years, according to CargoNet, a unit of Verisk, a global data and analytics company. More than $325 million in goods have been reported stolen so far this year.
"Whatever the consumer is buying, that's what the bad guys are stealing, " said Keith Lewis, vice president of operations for Verisk CargoNet.
After the truck went missing, Medroso says his sales started tanking and his business began losing money. Medroso had to cut back on spending and marketing. He says he laid off 15% of his staff. Medroso reached out to Amazon to get the goods taken off the website and his co-founder, Patricia Redulla, put out social-media videos asking customers to only buy from their website to avoid buying stolen products.
Cargo theft hits companies of all sizes, but small businesses are particularly vulnerable because one lost shipment can mean the difference between profit and loss. This kind of theft often goes unreported because businesses don't know who to contact, they worry their insurance premiums will rise or they don't want vendors or customers to know, said Jessica Renner, cargo claims and risk manager for Jarrett Logistics, a logistics firm.
Cargo theft ballooned during the Covid-19 pandemic as more sales moved online to platforms like Amazon.com. "That's when criminals really saw the vulnerability of the supply chain," said Bob Costello, chief economist for the American Trucking Associations, which supports legislation that would create new tools to fight cargo theft and other types of retail crime.
Medroso said he ordered the products with his company's brand listed on Amazon and then matched the lot numbers to the missing shipment, proving to him that his goods had been stolen.
"Amazon has zero tolerance for the sale of stolen goods, and we work hard to combat this industrywide issue," a spokesperson for the company said. The spokesperson said that Amazon took immediate action to remove suspected stolen goods after Sky & Sol complained.
Medroso, who dropped out of college to start a previous business, and his co-founder, Redulla, started Sky & Sol in 2023 with the idea of making a sunscreen without chemicals by using rendered animal fat. They contracted with a Chinese firm to make the product. Sales took off, with revenue reaching $7.1 million last year.
Over its first year and a half, Sky & Sol had no major hiccups.
Then came the shipment this July. It was picked up by a trucker named Johny Sharma, according to a copy of a commercial driver's license presented at the time of pickup that is included in the lawsuit. Urbandesi Trucking, a small outfit in Manteca, Calif., was responsible for the shipment's transport, according to court filings. Sharma was the assigned driver.
Sharma soon reported a problem with the fuel pump, according to court filings. Days later, the truck's GPS stopped. Eventually, he stopped communicating. Ten days after the shipment was picked up, Urbandesi said the entire shipment -- a total of 26 pallets and 1,092 cartons -- had gone missing.
Efforts to reach Sharma and Urbandesi by phone were unsuccessful. The address on Sharma's driver's license appears to have been vacated.
The theft was reported to the local police department. But Medroso wanted to find out who was responsible.
"I felt I was being taken advantage of. These people were riding on the backs of the work we did at Sky & Sol," he said. "I wanted to teach them a lesson."
Medroso wasn't able to track down Sharma, who he says in the lawsuit has disappeared. The trucking company's insurance agreed to pay Medroso $100,000.
To help with his quest, Medroso hired two law firms: one to work with law enforcement and a second to unravel the scheme and recover damages.
What they found was that his goods allegedly passed through a chain of little-known distributors, liquidators and third-party sellers from California to New York to Georgia, according to the 180-page lawsuit filed in California. They allege that at least 18 individuals and businesses participated in the theft or sale of the stolen goods. They claim that it amounted to a "pattern of racketeering," and are seeking more than $12 million in damages plus attorneys fees.
Many of those companies, however, deny any knowledge that the goods were stolen and say they were acting in good faith.
Sky & Sol alleges that Phoenix International Distribution, a small company in Royal Oaks, Calif., purchased the stolen goods, relabeled them and then distributed them to others. In the lawsuit, Medroso cites text exchanges between Phoenix and potential buyers offering his product at prices well below his wholesale price.
Ian Ballon, an attorney representing Phoenix, said the company "is a small business that operates solely as a product broker. It doesn't condone, support or knowingly engage in the sale or distribution of stolen or unlawfully obtained goods," he said.
Medroso alleges that Phoenix sold the goods on to other parties like a Georgia-based closeout and liquidation business, WPW Media.
"Of course, I didn't know they were stolen. That's just not something we deal with," said WPW Media Chief Executive Robbie Baldwin. WPW Media never took physical possession of the stolen goods, Baldwin said
Rayyan Syed also bought some Sky & Sol products from WPW for his business, 9 Syed. Syed, a college student who acts as a middleman and sells on Amazon and other marketplaces, said he was offered the sunscreen by multiple resellers.
"I had no idea it was stolen," he said. "It seemed like another kind of deal that goes around." Syed said he reached out to Sky & Sol after he learned from social media that a shipment had been stolen.
Phoenix, WPW and 9 Syed are named in the lawsuit.
"The problem here is that everybody thinks they are innocent and everybody wants other people to pay us," said Dan Harris, an attorney representing Sky & Sol. "Everybody should pay something."
Harris said Sky & Sol has been able to reach settlements with several buyers it believes had no knowledge of the theft.
Meanwhile, Medroso's customers also got caught up in the ordeal. They include Brittney Lickert, a personal design consultant in Stow, Ohio, cited in the lawsuit.
Lickert bought four tubes of Sky & Sol sunscreen on Amazon for almost 50% less than normal. "I just figured they were having some sort of sale, " said Lickert. She said she returned the product after learning from the social-media campaign that they were stolen.
Now after all these months, Medroso says his sales have started to rebound, but he has been rethinking his distribution chain. He has given his freight forwarding company more stringent guidelines. "Rather than just focusing on costs," he said, "we're looking at the reputation of the company." He says he is also working to move manufacturing to the U.S.
Medroso describes the whole ordeal as incredibly frustrating and said that trying to resolve it has been much more difficult than he expected. "It's a really big loss. I don't want it to happen to other people."
Write to Ruth Simon at Ruth.Simon@wsj.com
(END) Dow Jones Newswires
December 05, 2025 20:00 ET (01:00 GMT)
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