It's early in the year, and it's time to fulfill your
resolution to give your site a quick legal check-up.
Online businesses are now highly regulated, and there's
substantial liability if your site's not legally compliant.
In addition, your customers are becoming more Internet
savvy, and a site that's not legally compliant is not going
to be trusted. So, let's get started. Use This Checklist If You Already Have The Basic Site
Documents In Place 1. Copyright Notice. Check Your Copyright Notice. Your
copyright notice consists of the following elements: the
word "copyright" or copyright symbol (c in a circle)
followed by the year of first publication followed by the
name of the copyright owner. It's also a good idea to add
"All rights reserved worldwide". Example: Copyright 1996-09
Digital Contracts, Inc. All rights reserved worldwide. Note
that if you update your site from time to time, you should
add a date range reflecting the fact that the site has been
updated each year within the date range. If you haven't
updated yet for 2009, do it now. 2. Blogs, etc. Have you recently added a blog or any other
functionality that permits visitors to post text or digital
files to your site? Or, do you plan to do so as part of
your marketing plans for 2009? If so, you need to have a
DMCA notice in your Terms of Use and you also need to file
a DMCA Registration form with the U.S. Copyright Office.
These steps will create a "safe harbor" from strict
liability for copyright infringement if a site visitor
posts infringing material to your site. 3. Personal Information. Do you collect personal
information from site visitors? If so, review your Privacy
Policy to make sure that you identify all of the categories
of personal information you collect and the way in which
you share this personal information. If you've changed
these policies since you posted your Privacy Policy, amend
it now... without delay. 4. Data Security. Check your data security measures. If you
collect personal information, you are required to implement
"reasonable and appropriate" data security measures. These
measures are essentially moving targets since data security
technology evolves at a relatively rapid pace. What may
have been "reasonable and appropriate" a couple of years
ago may not pass muster today. Update your security
procedures, if necessary. 5. Future Sale of Your Business? If your online business is
starting to be successful and generate positive revenue,
have you ever considered that you might want to sell it for
a profit in the future? If so, be sure that your Privacy
Policy specifies that personal information collected may be
transferred and shared in the event of a sale. If you don't
do this prior to collecting personal information, you won't
be able to pass it on to your purchaser. The Federal Trade
Commission (FTC) stipulated in recent settlements that
personal information collected prior to posting this notice
in your Privacy Policy will not be transferable in the
event of a sale. And this personal information (your opt-in
lists and customer lists) are the real value of your online
business. 6. Service Providers. Do you use service providers to
provide hosting, site maintenance, SEO services, or other
site functions where they have access to your server? If
you don't collect personal information, your answer to this
question is immaterial, but if you do (and only an email
address will suffice), you need to enter into privacy and
security agreements with your service providers. The FTC
stipulated in a couple of recent settlements that you would
be liable if you don't. 7. Registration Agreement. Does your site require site
visitors to register for certain benefits such as a
membership or subscription rights? If so, you need an
electronic agreement (a so-called "click-wrapped" agreement
where the user clicks on "I ACCEPT"). Your agreement should
be presented conspicuously in the registration process and
it should require an affirmative act (clicking on "I
ACCEPT") to complete the registration. You also need to be
sure that all of your warranty disclaimers and limitations
of liability pass muster. 8. Collect Birth Dates? Do you collect the date of birth as
part of your registration process? If so, and if this date
indicates that children under 13 are registering, you will
be liable for substantial damages under the Children's
Online Privacy Protection Act (COPPA) if you do not comply
with COPPA's stringent requirements. You should either
modify your information collection practices or comply with
COPPA, or both. 9. Creditor Under FACTA? Do your registered users make
periodic payments payable as monthly or quarterly
installments, or do you extend credit so that payment is
made after receipt of the product or service? If so, you
fall within the statutory requirements of the Fair and
Accurate Credit Transactions Act of 2003 (FACTA). FACTA
requires that you adopt a "Red Flag" Identity Theft Policy
before May 1, 2009, or face substantial liability.
10. Sales Intermediaries? Do you use affiliates or
resellers? If so, a recent New York case illustrates that
you may be liable for their actions if they violate certain
laws acting on your behalf. For example, are your
affiliates engaged in illegal spamming activities? If they
are offering their own end user license agreements, do they
properly disclose certain activities such as the use of pop
up ads? You should check your affiliate and reseller
agreements and modify them, if required. Use This Checklist If You Don't Have Your Site Documents In
Place You may be just starting your online business, or you may
have procrastinated a little with your website legal
compliance. If you fall into this group, you should get
started without delay. I've developed a procedure that will help you determine the
correct mix of legal compliance documents for your site.
Part of it is set out below. First, if your site does not collect personal information,
you should consider these documents: * a Legal page for your intellectual property notices; and
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Chip Cooper is a leading intellectual property, software,
and Internet attorney who's advised software and online
businesses nationwide for 25+ years. Visit Chip's
http://www.digicontracts.com site and download his FREE
newsletter and Special Reports: "Determine Which Legal
Documents Your Website Really Needs", "Draft Your Own
Privacy Policy", and "Write Your Own Website Marketing Copy
-- Legally".
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