An internet presence is vital to the health of most enterprises. However, there are legal issues a business owner must consider before launching a website. C. Forbes Sargent III is a partner at Sherin and Lodgen LLP in Boston. He is chair of the Corporate Department at the firm and co-chair of the firm’s Employment Law and Social Media and Digital Technology Practice Groups. Here he offers advice on how to avoid legal problems that may arise with a company website.
Maintaining a business website is an essential part of doing business in the 21st Century. Most web developers recognize the need to include a “Terms and Conditions of Use” agreement. What should these agreements include?
Website terms and conditions are an important part of notifying your customers of your business terms and protecting your rights. They include who can use the site [can children use the site for example] how customers and others can use the site [for purposes of learning about your business or buying products, and not to harass others] that the company owns all of the content in the site and that the site is provided as is, without any warranties. If you sell products on your site, you often have provisions about terms of sale, shipping and return policies, not being responsible for typographical errors in pricing and prices subject to change without notice. And if you request customer feedback about your products, you want to be sure that the terms provide that you have the right to use the feedback in your products without any compensation to the customer providing the feedback. Of course, it’s also important to include the standard legal disclaimers.
What are a business’s legal responsibilities concerning protection of a customer’s private information collected online?
There are a number of state and federal laws governing customer’s privacy rights. If you collect personally identifiable information, such as customer names, addresses, credits cards, then the responsibility of the company goes way up. We have all seen the business fallout and costs that large companies have to bear for data breaches. Smaller companies want to be sure to keep their customers’ payment information with the third party payment provider and make sure they enforce policies internally regarding data protection.
The other area of concern is information about the customers’ buying habits that the company stores. For that, the best practice is to adopt a policy to notify your customers of how you use their buying information and to stick to that policy. You will have outraged customers and potential lawsuits if you say you are not sharing any of their information with third parties and they later find out that you sold their information to others for marketing purposes.
Many businesses now outsource website content creation to freelancers. What type of copyright should these businesses seek when contracting for this work?
Businesses want to be sure that whenever they contract for any outside work, whether it’s website development, software development or other services, that they be sure to own any copyrights or other rights to the content or other work product. It’s important to specify that the business owns this work, otherwise the default rule is that the freelancer owns the work.
What is Massachusetts law regarding the validity of electronic signatures?
Massachusetts has adopted the Uniform Electronic Transactions Act, which provides that if the parties agree to conduct transactions by electronic means, in writing or by their conduct, an electronic signature is valid and binding. Generally, a signature cannot be denied legal effect simply because it is in electronic form, and a contract cannot be denied enforceability simply because it was signed using an electronic signature.
This article was written by Gillian Burdett for Small Business Pulse