Five Benefits to Keeping Your Business Lawyer in the Loop

Let’s face it, the word “lawyer” for many is akin to a four letter expletive that people are offended by. Typically because it reminds people of getting sued and/or having to shell out, often unexpectedly, loads of cash that they rather have spent elsewhere…like on a vacation.  Similarly, like in all professions, not all lawyers are created equal, and not all lawyers really have their client’s financial interests at heart – after all, being a lawyer and having a law firm is a business. I personally pride myself on NOT taking advantage of my clients…giving them direction on how they can do things themselves and helping only where they REALLY need/want it…but after 18+ years in the legal field, I know that not all lawyers share my same client-friendly mindset. It is no wonder that people cringe at the thought of having to use a lawyer.

Lawyers don’t have to be a thorn in your side through.  In fact, a good lawyer can be a business’s greatest adviser and advocate – keeping in mind that a job of a lawyer is to tell you what you NEED to hear which can sometimes be very different than what you WANT to hear. All businesses should have a lawyer or two that they keep in regular contact with and it should be part of your regular business operating budget.

Before you go thinking I’m crazy, here are a few reasons that keeping your lawyer updated on the goings on of your business is advantageous:

  1. Lead Generation: Your lawyer can often be your biggest cheerleader (and lead generator) for future customers. Chances are your lawyer is tapped into many different networks.  You never know when someone they know will need your business’s products or services and a solid referral from your lawyer could be future revenue in your pocket.
  2. Idea Generator: An attorney that understands you, your business, and your goals can be an invaluable asset when it comes to creative thinking.  Brainstorming on new ideas with your lawyer may prove to be helpful in that they may be able to think of concepts outside the box for your business that you may not have already thought about.  What if that lawyer helps you generate the next million dollar idea?
  3. Cost Cutting: One thing that many lawyers are good at is organizing and streamlining processes – it’s part of the way we think.  What if your lawyer was able to give you ideas on how to streamline an existing process that will considerably help cut costs moving forward?  If a few hundred dollars for your lawyer’s time on the telephone could save you thousands of dollars in the next year, wouldn’t you do it?  Sure you would.  You’d be a fool not to.
  4.  Risk Mitigation: When you brainstorm with your lawyer on a new business concept, they can often help you plan your road-map to reach your goals and help you navigate around pitfalls that you might not even think about.  For example, when clients come to me talking about setting up a new business I always ask them the business name and ask if they have considered any reputation issues with that new business name.  The same goes for contracting issues, employee issues, etc. To that end as well, there is a LOT of bad information being circulated around on the internet. Indeed it is wise to conduct your own research but don’t you think it prudent to have your research double-checked by someone who knows where to actually find the correct information when it comes to the law? As Dr. Emily So once said, “better information means better ideas, means better protection.”
  5. Cost Effective: It is a lot cheaper to keep your lawyer up to speed on your business as it grows, even if through a short monthly 15 minute call, than it is to try and ramp your attorney up (trying to teach them everything about your business, including policy changes and the like in a short amount of time) when you suddenly need advice in order to be reactive to a situation – like when you are named as a defendant in a lawsuit.  When you are named as a defendant in a lawsuit, you typically only have 20 days (varies by court and jurisdiction) from the date that you are served with a complaint in order to determine what your defenses are and what sort of a response you will need to file.  That process becomes a whole lot easier if your attorney already knows about you, your business, it’s policies and procedures, etc.  It is also easier to to budget in a few hundred dollars a month to keep your attorney up to date then to get smacked with a request for a $20,000.00 retainer, most of that potentially being eaten up just “learning” about your business, and then having subsequent large litigation bills.

As you can see, there are many reasons to regularly communicate with your attorney and hopefully you would find it more advantageous and beneficial than paying your monthly insurance bill. As Benjamin Franklin once said, “an ounce of prevention is worth a pound of cure!”

If you are in the state of Arizona and are looking for that solid “friend in the lawyering business” consider Beebe Law, PLLC!  We truly enjoy helping our  business clients meet and exceed their goals!  Contact us today.

All information contained in this blog (www.beebelawpllc.blog.com) is meant to be for general informational purposes only and should not be misconstrued as legal advice or relied upon.  All legal questions should be directed to a licensed attorney in your jurisdiction.  

 

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Website Terms of Service: You Are Responsible for Your Own Actions

In my practice I write and review website terms of service with some regularity.  Most website Terms of Service have sections that relate to a users online conduct; that is, the rules that the website expects you follow when using their website.  If you don’t read anything else (because let’s fact it, unless you LOVE fine print, you probably aren’t going to read it) you absolutely should review the section that discusses what conduct is expected of you.  If you aren’t going to follow the rules don’t use the website.

Yes, this sounds like a no-brainer, right?  You’d think so, however, you would be fascinated to learn how many people don’t pay attention to these things and then, when they get busted breaking a Terms of Service rule, they come back and try to blame the website for the rule!  Um, no.  How about you try taking some responsibility for your own actions?  Yeah, let’s try that.

WHAT DO THE TERMS OF SERVICE SAY ABOUT MODIFICATION OR REMOVAL OF CONTENT?

Many websites will allow users to post content and then edit or remove the postings at a later date.  Consider sites like Facebook for example.  Other websites will give you only the ability to delete postings, but not edit, as seen with sites like Twitter.  At the same time many websites will not allow a user to edit or remove information once it is posted, regardless of the circumstances.

I typically see these no-removal rules often with complaint/review styled websites and this information is usually spelled out in the Terms of Service and, in some cases, elsewhere on the website.  Why would a website make such a rule?  Some websites claim that the reason they have a no removal policy, especially on a review/complaint type website, is because those websites believe that people will be bullied into taking truthful content down when the public really should be warned about bad actors or bad businesses.  I suppose the websites figure that if they have a rule against removing content, it doesn’t do the bad actors or bad businesses any good to harass the poster because the information is going to remain up anyway.  Yes, I know this opens Pandora’s Box for the “but what if…” statements and I know well the arguments against such non-removal rules, but I will not engage in that here because I’d be writing a dissertation and I’m trying to keep on topic and make this relatively short.

TERMS OF SERVICE:  WHY YOU SHOULD CARE.

Unfortunately, from my perspective, most people don’t care about these kinds of things and go on there merry way using a website, posting content, etc, – until they are threatened with litigation over something they posted.  Defamation is against the law and is actionable.  Most websites will make you agree, per their terms of service, that you will not do anything illegal.  They might even spell out that you have to tell the truth if you are posting a complaint or review.  Unfortunately, people either can’t read, don’t know what “truth” means, or otherwise don’t give a crap because they write stupid stuff anyway.  If you say something mean and untruthful online about someone else or someone else’s business – there is a possibility that you will see a defamation action against you.  Heck, even if what you say is truthful, you still could see a defamation action against you.  It’s the way the world these days – people sue over the most ridiculous stuff! Yes there are defenses to such claims, like the truth, however, if you use an attorney, it’s going to be legal battle that you will have to fund.

Typically a person considering litigation is going to go the easiest route and ask the person who posted the information to simply remove it.  If the person posted the information to websites like Facebook or Twitter, chances are one can just log into their account, edit or delete the content at issue, and be done with it.  HOWEVER, what happens when you posted the content to a website that specifies, right in their terms of service, that you can’t remove the posting?  If that is the case, chances are, that content isn’t coming down – even if you ask and regardless of the situation.

DON’T BLAME THE WEBSITE FOR YOUR MISTAKE.

Now we are getting to the ironic part.  A person will use a website, knowingly break the rules (such as posting false and defamatory stuff) and then, when they get a letter from a lawyer or a lawsuit against them, all of the sudden get concerned about what they wrote and will try to figure out how to take it down.  It’s like when you’ve been speeding, know you were speeding, and act all surprised when you get pulled over by a cop and quickly try to make an excuse for why you were speeding – as if that is going to somehow change the fact that you broke the law by speeding.  When an author gets a letter from a lawyer about a posting online the first thing they do is try to take it down.  In some instances they can remove the content…but that doesn’t always work as I explained above.  It amazes me how many people will write to a website asking for their stuff to be removed even when the terms of service, and the fact that someone can’t remove something after it was posted, was made abundantly clear before they made the posting.  When they get told “no” somehow that comes as a shock.  What happens next, in my experience, is one or any combination of the following:

  1. Excuses of why they wrote what they did.  The whole I was mad/sad/hurt shouldn’t have done it story.  This is what I call fools remorse.
  2. Allegations that “someone else” wrote it. People will literally allege that their “minor child” wrote the sophisticated well written posting about a business dealing. Uh huh, sure they did…and way to throw your kid under the bus.
  3. Stories of how the author/user of the website is “special.”  Most people that claim “special circumstances” aren’t all that unique when compared to anyone else.  I know your momma thinks you are special – but a website probably isn’t going to think so.
  4. Statements of “I wrote it.  It’s false…so you HAVE to take it down!”  No, actually the website doesn’t (at least under current federal law) and are you basically admitting that you breached the contract with the website that said you wouldn’t post something that is false?  Hmmm, that doesn’t seem like a very smart argument.
  5. I’m going to sue you if you don’t take it down!  Cool story – the current law doesn’t support your position and you are making yourself look like ass.  By the way, those terms of service that you agreed to by using the website or otherwise “checking the box” saying you agreed – yeah, that’s called a contract.

I wish I was making this stuff up but I have literally seen all of these kinds of excuses/stories made by people who are getting into trouble for what they posted online.  If you are one of THOSE people – you deserve to get into trouble.  The most ridiculous position that one can take is to be mad and blame a website for having known consequences to a rule THAT YOU BROKE.  That’s like being mad at the law makers who created the speed limit when you get into trouble because you broke the law by speeding!  No one made you speed.  Own the problems that you create.

Bottom line; read the Terms of Service before you use a website.  If you break the rules (especially if you are a harasser or defamer) don’t get mad at the websites for having the rules and consequences (that you failed to consider when you broke the rules) applied to you.  You have to own and accept responsibility for your actions – regardless of how hard of a pill that is to swallow. 

Until next time friends…

All information contained in this blog (www.beebelawpllc.blog.com) is meant to be for general informational purposes only and should not be misconstrued as legal advice or relied upon.  All legal questions should be directed to a licensed attorney in your jurisdiction.

Clicking the “I Have No Idea What This Says” Button

Understanding the basic differences between Browse-wrap and Click-wrap Agreements

Welcome to the age of technology…where everything you do is pretty much online!  You meet people online, you keep up with loved ones online, you post comments online, download software online, you purchase  online, etc.  For every website platform you interact with there should be some sort of Terms of Service (TOS) or Terms and Conditions (TAC) that you will have to agree to.

So yeah, that little box that you checked quickly so that you could move on and see more information, or download your favorite song, etc., that stuff is the important stuff that you just AGREED TO that NO ONE ever really reads.  Well, except for maybe a few of us contract lovers and people looking for the “easter egg” of comical interruption alleged to be contained within the long winded legal mumbojumbo.  Turns out, at least in my experience, those allegations are fake.  Rarely do I see any humor in contracts.  I know…so BORING!

There are typically two different types of agreements – the Browse-wrap and Click-wrap.

THE CLICK-WRAP AGREEMENT

The more common agreement, the click-wrap agreement (also referred to as a “clickthrough” agreement or a “clickwrap license”), is the one that I generally referenced above.  It’s the agreement that actually requires you to take some sort of action, like clicking on an unmarked box, to show that you agree to the terms set forth by the website or platform.  If you think about it, the website is literally placing the website’s TOS right into your hands (for reading) and asking you to acknowledge the agreement by “clicking the box” or whatever other form that assent may come in.  If you want to refuse the agreement (who does that?) then one would cancel or  close the window to the subject website.  Courts typically uphold these kinds of agreements so remember when you are clicking you are probably entering into a legally binding contract.

THE BROWSE-WRAP AGREEMENT

Your browse-wrap agreement (also called a browserwrap or a browse-wrap license) is the other version.  Generally your browse-wrap agreement is located somewhere on the website; usually seen as a hyperlink at the bottom of the page to the TOS or TAC.  There is no “clicking” to manifest their agreement to the website’s terms.  The idea behind this is that by a person’s mere use of the website they agree to the websites terms.  Courts have been reluctant to uphold these types of agreements UNLESS the user has agreed to the terms.

BELT AND SUSPENDERS

Most websites these days, especially where they are interactive, will have BOTH a click-wrap agreement and a browse-wrap agreement tied to their website.  This is done so that the website can inform users of their website’s TOS/TAC but also, for legal contracting purposes, to aid in enforce-ability of those terms.  Contracts, in order to be upheld, require mutual manifestation of assent.

If you are a website owner, you want to be sure that your agreements are protecting your interests and you should consider seeking legal counsel on the matter if you have any questions.  Beebe Law, PLLC is an Arizona based law firm representing clients in the state of Arizona.

 

 

Contracts: The Hidden/Overlooked Master Agreement

I have had more people come to me, explain a situation, and then ask me if they have to perform a certain task as part of some agreement or argue that they didn’t intend to be bound by the agreement.  My response:  Do you have a contract and what does it say?  It sounds pretty cut and dry, but for some, this is a real struggle and often times people will gloss over the agreement, and sign it, without really paying attention to the terms.  If this is you, don’t feel bad, you are not alone.  Countless times I have had clients bring me a Scope of Work or Purchase Order and tell me “this is the agreement” to which I ask, “Where is the rest of it?”  You can imagine people’s confusion when I ask this question, especially when they think THAT is all there is.  Unless you are dealing with someone that doesn’t understand contracting, chances are, there is more…you just may have overlooked it.

MASTER AGREEMENT:  A Master Agreement is the main portion of the Agreement that often outlines what some all the “boilerplate terms.”  Most people overlook this section and don’t negotiate the terms.  However, you should not overlook the “boilerplate terms” because they can be very important.  The “boilerplate terms” often outline payment terms, duration of agreement and renewals (like automatic ones), warranties, choice of law/jurisdiction, dispute resolution, damages for failure to adhere to the contract, intellectual property rights, etc.  A person’s failure to overlook these types of terms can be detrimental if not carefully reviewed and considered.  If you are curious about what kinds of issues can be present in “boiler plate” contract language, you can read my prior blog post Contract Terms: The Boilerplate Language IS Important.

ORDER FORM:  The Order Form is typically the portion of the agreement that outlines the client/customer specific information which are typically negotiated between the parties. This is typically why it receives the most attention.  These documents typically incorporate by reference the Master Agreement (which might be provided as a simply link to a URL online).

  • PURCHASE ORDER:  A Purchase Order (“PO”) is commonly used where the Master Agreement contemplates a purchase/sale of goods.  This will typically outline the types, quantities and agreed upon prices for products and/or services that may be associated, payment method and scheduling for the same and method of shipping, and includes any special requirements or other miscellaneous that the Master Agreement may not contemplate or you otherwise negotiate for (such as a change of a term under the Master Agreement).
  • STATEMENT OF WORK:  Statement of Work (“SOW”) is commonly where the Master Agreement contemplates services to be provided.  This will typically define the scope of the activities to be completed, the location of the work to be performed, period of performance, itemize deliverables and what timeline exists in connection with those deliverables, pricing, payment method and schedule for the same, any standard regulatory or governance terms and conditions, and includes any special requirements or other miscellaneous that the Master Agreement may not contemplate or you otherwise negotiate for (such as a change of a term under the Master Agreement).

Unless you are a contracts attorney who loves the fine print (and maybe we don’t even really love the fine print but at least we can understand it) you may be tempted to only focus your attention on the Order Form document, however, as discussed it is incredibly important that you read through all of the terms of any Master Agreement in connection with any Order Form to make sure you don’t get caught off-guard.  It’s always good practice to inquire about a Master Agreement when presented with nothing more than a Order Form…and keep the two documents together.  Don’t just rely on the information you can read in a URL link because you never know when the Master Agreement at that URL will change.  It’s better to trust your own records than to rely on someone else!

If you are unclear as to whether or not the boilerplate language is appropriate for your situation, and you want to work through the issues, you are encouraged to speak with a Contract Attorney in your area who can assist you.  Beebe Law, PLLC is an Arizona based law firm representing clients in the state of Arizona.

 

Contract Terms: The Boilerplate Language IS Important

Every day people and businesses enter into contracts for one reason or another.  If you are running a businesses you likely have contracts that you have your customers/clients sign which outline the obligations of each party.  Most people only really consider the “meat” of the contract…you know, the who, what, where and when; but what about all of that “lawyery stuff” at the end?  Many people will put boilerplate language into their agreements without knowing what implications those clauses will have on them if either party fails to live up to the terms of the agreement.  Similarly, people will sign a contract without paying attention to all that “lawyery stuff” at the end because…well, it’s boring and can be hard to understand.  Does all that boilerplate language really mean anything?  Yes!  Especially if the person drafting the contract may have just cut and paste clauses off of something they found on the internet without really understanding how those things would be applied when things fall apart.

Sure, it seems easy to just cut and paste and/or use prior agreements and roll them over into a new situation…but it may cost you more in the long run if and when something goes wrong.

The boilerplate language at the end of your contract are important for a few reasons:

  • They are real contractual terms that have to be understood
  • They impact your legal rights as to the agreement
  • They can actually control or limit the enforcement of your contractual rights
  • They can, perhaps unintentionally, void portions of your contract that you might have already negotiated in your contract

What are some of the “boilerplate clauses” that are typically at issue in a contract?  The following are a few clauses that are important to review:

  • Choice of Law and/or Choice of Forum Clauses
    • These can define the law that will govern the contract which can get sticky if your contract is contrary to this clause.
    • These can define the place that the contract can be enforced which may or may not be favorable to you.
    • These may limit your rights to sue in certain kinds of courts.
    • These may subject you to a certain jurisdiction regardless of whether or not you happen to live or have minimum contacts with that particular jurisdiction.
  • Arbitration Clause
    • This is primarily used to discourage litigation by limiting the right to a trial through a traditional court system.
    • This can be more cost effective way to resolve disputes than going through a full blown litigation.  This is not always the case.
    • These can describe the specific process for proceeding through to arbitration which can be very different that a traditional court proceeding.
  • Jury Trial Waivers
    • A person needs to understand what exactly is being waived in by the clause.
    • A person needs to understand whether or not the clause will be enforceable in the state that the agreement is to be determined under.  Not all states would enforce this kind of a clause.
  • Severability Clauses
    • These usually say, generally, that if one clause or portion of an agreement isn’t enforceable then it is eliminated and all the rest of the contract is still in tact but some states won’t enforce it and therefore the entire clause could be void.
    • Sometimes these issues can be carved out specifically to protect the rest of the agreement.
  • Cooperation Clauses
    • These usually state that the parties are suppose to cooperate, etc. and it seems like it could be a good idea, however, one person’s cooperation might be another person’s demand for additional terms that aren’t in the agreement in the first place.
    • Sometimes these issues can be spelled out so that there isn’t unintentional consequences in the future.
  • Integration/Merger Clauses
    • Think about all of the prior communications and documents that are related to the agreement…is everything necessary and material in the actual agreement?
    • Have all representations that have been made the parties, agents of the parties, etc., all been incorporated?
  • Warranties
    • Is everything listed in the clause true?
    • Are you sure what the implied and express warranties are?
    • Do you need to limit any certain warranties?
    • How does the governing law handle warranties?
  • Damages Clause
    • Do you have a situation where you want to limit the damages?
    • Does the state law governing the agreement refuse to enforce the kind of limit you are trying to provide for in the contract?
      • Estimated damages or liquidation clauses need to be supported.
      • Penalty clauses that appear to be purely punitive (as punishment) are not likely to be enforced.
  • Indemnification Clauses
    • These are good for situations where some third-party might sue one of the parties of the agreement and the other party doesn’t want liability.
    • These are good to have so long as they are tailored to fit the governing law of the contract; are tailored to spell out who is indemnifying who for what; and outlines the process for getting notice of the indemnification, etc.
    • Certain claims cannot be covered by an indemnification clause.

If you are unclear as to whether or not the boilerplate language is appropriate for your situation, and you want to work through the issues, you are encouraged to speak with a Contract Attorney in your area who can assist you.  Beebe Law, PLLC is an Arizona based law firm representing clients in the state of Arizona.