Volume 78 - April 2013
In this issue:
The Ten Greatest Legal Mistakes on-line…. And how to avoid them
Business owners have, for centuries, confined themselves to the usual old legal mistakes. However now there are bigger on-line legal mistakes that even the smallest business can make comparably cheaply, as follows:
Mistake no. 1. You defame someone.
Despite this being a popular legal mistake in the off-line world you will be surprised to hear that this did not make it onto the original 10 mistakes list. But on-line this moves to the number one slot. It is the wide reaching audience and the casual manner in which this can be achieved. Please read my Defamation Special for more information.
Mistake no. 2. You take others content without their permission.
It is easy to copy and paste content from another site. It is not enough just to acknowledge the author of the content; you need permission to use it. In fact, referring to the author confirms that you know it belongs to another. In any event, it is not a defence to say that you did not know it belonged to someone else.
Mistake no. 3. You enter into a contract that you cannot deliver.
On the internet an offer of a substantial discount can be magnified so that it is quickly accepted by many people before you realize that you got your numbers wrong. The courts will not save you from bad bargains.
Mistake no. 4. You do not have terms and conditions.
If you do not impose your terms and conditions on people visiting your site and buying your goods then you are taking an unnecessary risk. It is not so much the liability, it is that consumers are quick to complain and use the discussion pages to blacken the name of your business if they feel that they have been treated unfairly. Therefore, it is best not to leave grey areas where disputes can arise. Terms and conditions also allow you to make concessions while, at the same time, demonstrating that the law was on your side. Often in an on-line dispute with a difficult client, giving the money back is the cheapest and easiest option, however much it sticks in your throat.
Mistake no. 5. You fail to identify and manage your intellectual property.
What are your trade secrets? Don’t answer that! If it is a really good idea and not nailed down someone will steal it. Do you use copyright notices, get assignments of valuable designs, logos and important materials? Use licences when you allow other people to use your name, services, products or ideas as part of their business. You can lose rights by allowing easy use. Or others can say that they thought they could use it too (“implied” consent). Please read “Protecting your Ideas, Products and Brands” for more information.
Mistake no. 6. You do not have written contracts with your consultants and employees.
Employees and consultants can not only take your paper clips but your trade secrets, client lists and best ideas and deliver them to your competitor. The general law protects your trade secrets to an extent. However, a contract can supplement this protection with conditions relating to confidentiality and intellectual property especially with regard to consultants.
Mistake no. 7. You are beaten to the post in registering a domain name.
There is a great, cost effective dispute process but unless the person who took it has acted in bad faith it is probably first come, first served.
Mistake no. 8. You fail to protect your business/product names.
You may have a domain name and a registered business name but only a trade mark confers ownership of a name for a certain type of goods or service. Don’t allow a competitor the opportunity of applying for a trade mark of your essential business name or products. Protect yourself by registering a trade mark. For more information see Ready Fire Aim, DIY Trade Marks.
Mistake no. 9. You fail to avoid unnecessary disputes.
When selecting a business or product name try chose one which will not upset well known brands or competitors with conflicting trade marks as they are likely to sue you. It is being involved in such a dispute, win or lose, which is expensive. Therefore it is simpler but less fun to avoid the dispute in the first place.
But once you have settled on a name or created content you must at least give the impression that you will defend it to the death in order to deter competitors from stealing your content and ideas. Use copyright notices, licences and police the use of your content. If you can’t fight get a big hat.
Mistake no. 10. You buy an on-line business without legal advice.
Buying an on-line business is tricky as it can involve copyright, licences, trade marks, assignments, transfers and chains of title. You may find that after your money is long gone that you did not in fact end up buying anything as someone else may still own it. Usually on-line businesses are a bundle of rights each of which needs to be transferred. Sometimes the person selling does not own what he is trying to sell or has a right to use it which is not transferable. A few words of legal advice can help you gain effective title or, alternatively, the legal costs can outweigh the benefit of buying. If you plan to sell it on then you need to make sure that you have bought all of the on-line business in the first place.
Shortly after writing the Ten Greatest Legal Mistakes in Business…. and how to avoid them in making an appointment a potential client told my secretary that it was a “No. 7”. When he did not turn up my dreams of a Legal Advice By Numbers franchise with its simplicity and price slashing, for some reason, ended. However, your On-line legal mistakes can make you an international sensation in legal circles. So beware.
(c) Paul Brennan 2013. All rights reserved.
My lawyer never recognises me; it is as if he is meeting a stranger each time. He has been my lawyer for 10 years and whereas I do not expect a red carpet, I would like him to know who I am.
In your next appointment ask your lawyer for money. Your lawyer will never forget you again.
TO BE PUBLISHED IN JUNE 2013
Disclaimer: The content of the Law & Disorder eZine is to give you legal basics and in some instances, included unashamedly to try and make you laugh. In law, it is sometimes difficult to work out what is serious and what is just for fun. Therefore, if you plan to do anything legal, rely on your own lawyer’s advice or instruct me to look at the particular facts of your case. Not only will I deny responsibility for the legal content but also for some of the jokes.