Business Law

Anette B.

E-Commerce: Pros and Cons of Drop-Shipping

Drop-shipping is a popular business model in e-commerce where a retailer does not hold inventory but instead transfers customer orders and shipment details to a supplier or wholesaler, who then ships the products directly to the customer. While drop-shipping offers several advantages, it also comes with certain challenges. Let’s explore the pros and cons of drop-shipping:

Pros of Drop-shipping:

  1. Low Startup Costs: Drop-shipping eliminates the need to invest in inventory, warehousing, and shipping infrastructure, making it a cost-effective option for entrepreneurs with limited capital.
  2. Wide Product Range: As drop-shippers rely on suppliers with extensive inventories, they can offer a wide range of products without managing physical stock.
  3. Flexibility and Scalability: Drop-shipping allows businesses to test various product lines and adjust their offerings quickly based on customer demand. It also offers scalability without the limitations of managing inventory.
  4. Location Independence: Drop-shipping businesses can be managed from anywhere, as long as there is an internet connection. This allows for greater flexibility in work arrangements.
  5. Reduced Risk: Since the drop-shipper does not pre-purchase products, they are not exposed to the risk of unsold inventory or slow-moving goods.

Cons of Drop-shipping:

  1. Lower Profit Margins: Drop-shipping often involves lower profit margins compared to traditional retail models due to the additional costs involved in paying suppliers and shipping fees.
  2. Inventory and Product Quality Control: Drop-shippers rely on third-party suppliers for inventory, which can lead to challenges in monitoring product quality, availability, and shipping times.
  3. Order Fulfillment Challenges: As drop-shipping involves multiple parties, there is a risk of miscommunication and delays in order fulfillment, potentially leading to customer dissatisfaction.
  4. Branding and Customer Relationships: Drop-shippers have limited control over packaging, branding, and customer experience, which may impact their ability to build a strong brand and lasting customer relationships.
  5. Competitiveness: The low barriers to entry in drop-shipping can lead to increased competition, making it challenging to stand out in a crowded market.
  6. Supplier Reliability: The success of drop-shipping heavily relies on the reliability and efficiency of suppliers. If a supplier fails to deliver on time or experiences stock shortages, it can directly impact the drop-shipper’s business. Depending on your vendor’s terms of service, you may have little recourse for errors to boot.
  7. Profit Margin Compression: As more retailers enter the drop-shipping space, suppliers may increase product prices or charge additional fees, leading to reduced profit margins for the drop-shipper.

In conclusion, drop-shipping offers a flexible and cost-effective way to start an e-commerce business, but it also comes with inherent challenges. Entrepreneurs considering drop-shipping should carefully weigh the pros and cons to determine if this business model aligns with their goals and capabilities. Proper supplier selection, effective communication, and a focus on providing a positive customer experience can help mitigate some of the challenges associated with drop-shipping.

Disclaimer: This information is intended to be general advice and should not be relied upon as formal legal advice. If you are looking for legal advice as to your particular situation, please contact an attorney in your jurisdiction. If you’re located within the state of Arizona, consider contacting Beebe Law, PLLC.

Anette B.

Ninth Circuit says COPPA does not preempt state law claims – Jones v. Google

In this case, a class of children (“Children”), represented by their parents and guardians, filed a lawsuit against Google LLC, YouTube LLC, and several other companies, alleging violations of the Children’s Online Privacy Protection Act (COPPA). The Children claimed that Google used persistent identifiers (via targeted advertising) to collect data and track their online behavior without their consent, which violated state law and COPPA regulations. More specifically, Children are seeking “damages and injunctive relief, asserting only state law claims: invasion of privacy, unjust enrichment, consumer protection violations, and unfair business practices, arising under the constitutional, statutory, and common law of
California, Colorado, Indiana, Massachusetts, New Jersey, and Tennessee. The parties agree that all of the claims allege conduct that would violate COPPA’s requirement that child directed online services give notice and obtain “verifiable parental consent” before collecting persistent identifiers.” Google argued that it wasn’t subject to COPPA because YouTube is a “platform for adults” even though it knows that children use the platform. [Editor’s note: That sure does seem like a stretch of an argument given just how much content directed at children there is on that platform.]

The district court dismissed the case, citing preemption grounds (that is that the state law claims were preempted by COPPA, a federal regulation), but the Ninth Circuit Court of Appeals reversed the dismissal in an amended opinion.

The Court first considered whether COPPA preempted state law claims that were based on the same conduct prohibited by COPPA. The court noted that: “[e]xpress preemption is a question of statutory construction. COPPA’s preemption clause provides: ‘[n]o State or local government may impose any liability . . . that is inconsistent with the treatment of those activities or actions under this section.‘ 15 U.S.C. § 6502(d).” (emphasis in original) The court determined that state laws that supplement or require the same as federal law are not inconsistent and do not stand as an obstacle to Congress’s objectives. Thus, the court concluded that COPPA’s preemption clause does not bar state-law causes of action that are parallel to, or proscribe the same conduct forbidden by, COPPA.

The court also addressed conflict preemption, which occurs when state law conflicts with a federal statute. They found that conflict preemption did not apply in this case because the state law claims did not prevent or frustrate the accomplishment of COPPA’s federal objectives.

As a result, the Ninth Circuit reversed the district court’s dismissal of the case on preemption grounds and remanded it for further consideration of other arguments for dismissal.

Citation: Jones v. Google, LLC, Case No. 21-16281, 9th. Cir. (Jul. 13, 2023)

Disclaimer 1: This summary was initially generated by ChatGPT and then edited to include more specific information by a real human … because, you know, humans are still better than the machine tool.

Disclaimer 2: This is for general information purposes only. This should not be relied upon as formal legal advice. If you have a legal matter that you are concerned with, you should seek out an attorney in your jurisdiction who may be able to advise you of your rights and options.

Anette B.

The Temptation of ChatGPT for Legal Contracts: Why Human Expertise Reigns Supreme

Disclaimer: This article, while reviewed and slightly edited by a real live human prior to publication, was initially drafted by ChatGPT. Even ChatGPT knows its own limitations.

In this digital age, where technology continues to advance at a rapid pace, it’s no surprise that businesses and individuals seek innovative solutions for various tasks, including legal contract creation. With the rise of AI-powered language models like ChatGPT, one might be tempted to rely on them for generating legal contracts quickly and conveniently. However, while ChatGPT and similar tools offer impressive capabilities, there are significant reasons why they fall short when it comes to formal legal contract creation.

Understanding the Temptation

ChatGPT, with its ability to generate coherent and contextually relevant text, can be alluring for those seeking a quick solution for legal contract drafting. The convenience of inputting prompts and receiving instant responses may seem enticing, especially for individuals who are not well-versed in legal language or lack the resources for professional legal assistance. The prospect of saving time and money might make ChatGPT an appealing choice at first glance.

The Limitations of ChatGPT

  1. Lack of Contextual Understanding: While ChatGPT excels in understanding and generating text based on provided prompts, it lacks the ability to truly comprehend the nuances of legal contracts and their specific legal implications. It lacks a deep understanding of legal concepts, precedents, and regulations that are crucial for creating enforceable and comprehensive contracts.
  2. Legal Accuracy and Updates: Legal landscapes are dynamic, with laws, regulations, and court rulings subject to change. ChatGPT’s training data might not encompass the most up-to-date legal information, potentially leading to inaccuracies or outdated clauses in generated contracts. Attorneys stay abreast of legal developments and ensure that contracts align with current laws and regulations.
  3. Tailored and Specific Legal Advice: Legal contracts require a personalized touch to address the unique needs and circumstances of each client. ChatGPT, while proficient in generating text, cannot provide the tailored legal advice and expertise that an attorney can offer. Attorneys can carefully analyze a client’s situation, identify potential risks, and customize contracts accordingly.
  4. Complex Legal Language: Legal contracts often utilize specialized terminology and language that carry precise legal meanings. ChatGPT may not fully grasp the intricate nuances and subtleties of legal language, potentially resulting in ambiguous or poorly drafted provisions that could be exploited or lead to disputes.
  5. Confidentiality and Security: Legal contracts often involve sensitive and confidential information. Sharing such information with a third-party AI model might raise concerns regarding data privacy and security. Working with a trusted attorney ensures the confidentiality and protection of sensitive information.

The Indispensable Role of Human Expertise

While technology can undoubtedly enhance various aspects of our lives, legal contract creation necessitates the expertise, experience, and ethical judgment that only human attorneys can provide. Attorneys possess the legal knowledge, contextual understanding, and analytical skills required to create contracts that mitigate risks, protect client interests, and ensure compliance with applicable laws.

By engaging an attorney for legal contract creation, businesses and individuals can benefit from:

  1. Tailored Advice: Attorneys can assess unique circumstances, identify potential risks, and provide advice tailored to specific needs, ensuring contracts align with individual goals and requirements.
  2. Legal Compliance: Attorneys stay updated on legal changes and ensure that contracts adhere to current laws and regulations, reducing the risk of non-compliance and legal disputes.
  3. Clarity and Precision: Attorneys are skilled in crafting precise and unambiguous contract language, minimizing the potential for misinterpretation and reducing the likelihood of future disagreements.
  4. Risk Mitigation: Attorneys understand the potential risks associated with different types of contracts and can draft provisions that protect clients from liabilities and unforeseen circumstances.
  5. Dispute Resolution: In the unfortunate event of a contract dispute, attorneys provide legal representation and guidance, leveraging their expertise to achieve favorable outcomes through negotiation, mediation, or litigation.

While ChatGPT and similar AI language models have their merits, they cannot replace the indispensable role of human attorneys in the creation of formal legal contracts. The complexities, legal nuances, and individual circumstances involved in contract drafting necessitate the knowledge, experience, and personalized advice that only human legal professionals can provide. By seeking the guidance of an attorney, individuals and businesses can ensure the creation of enforceable, comprehensive, and customized contracts that protect their interests and mitigate legal risks.

[EDITOR NOTE: Look, we get it. Everyone wants a faster way to prepare content. Lawyers are no exception. That said, it’s important to understand the difference between when ChatGPT can be a useful tool, and when it’s best to have a set of trained legal eyes looking at and thinking about something. Legal documents are not the area where you want to cut corners. If you do, there is a good chance that you will be paying a lawyer to deal with a ChatGPT mess up … because, you know, ChatGPT makes up fake law and stuff. Don’t bet the company on ChatGPT … at least not yet.]

DISCLAIMER: This is for general information purposes only. This should not be relied upon as formal legal advice. If you have a legal matter that you are concerned with, you should seek out an attorney in your jurisdiction who may be able to advise you of your rights and options.

Anette B.

Pro Se’s kitchen sink approach results in a loss – Lloyd v. Facebook

The “kitchen sink approach” isn’t an uncommon complaint claim strategy when it comes to filing lawsuits against platforms. Notwithstanding decades of precedent clearly indicating that such efforts are doomed to fail, plaintiffs still give it the ole’ college try. Ironically, and while this makes more sense with pro se plaintiffs because they don’t have the same legal training and understanding of how to research case law, pro se plaintiffs aren’t the only ones who try it … no matter how many times they lose. Indeed, even some lawyers like to get paid to make losing arguments. [Insert the hands up shrug emoji here].

Plaintiff: Susan Lloyd

Defendants: Facebook, Inc.; Meta Platforms, Inc.; Mark Zuckerberg (collectively, “Defendants”)

In this instance Plaintiff is a resident of Pennsylvania who suffers from “severe vision issues”. As such, she qualified as “disabled” under the Americans with Disabilities Act (“ADA”). Ms. Lloyd, like approximately 266 million other Americans, uses the Facebook social media platform, which as my readers likely know, is connected to, among other things, third-party advertisements.

While the full case history isn’t recited in the Court’s short opinion, it’s worth while to point out (it appears anyway with the limited record before me at this time) that the Plaintiff was afforded the opportunity to amend her complaint multiple times as the Court cites to the Third Amended Complaint (“TAC”). According to the Court Order, the TAC alleged claims violations of:

Plaintiff alleged problems with the platform – suggesting it inaccessible to disabled individuals with no arms or problems with vision (and itemized a laundry list of issues that I won’t cite here … but suffice it to say that there was a complaint about the font size not being able to be made larger). [SIDE NOTE: For those that are unaware, website accessibility is a thing, and plaintiffs can, and will, try to hold website operators (of all types, not just big ones like Facebook) accountable if they deem there to be an accessibility issue. If you want to learn a little more, you can read information that is put out on the Beebe Law website regarding ADA Website Compliance.]

Plaintiff alleged that the advertisements on Facebook were tracking her without her permission … except that users agree to Facebook’s Terms of Service (which presumably allow for that since the court brought it up). I’m not sure at what point people will realize that if you are using something for free, you ARE the product. Indeed, there are many new privacy laws being put into place throughout various states (e.g., California, Colorado, Utah, Virginia and Connecticut) but chances are, especially with large multi-national platforms, they are on top of the rules and are ensuring their compliance. If you aren’t checking your privacy settings, or blocking tracking pixels, etc., at some point that’s going to be on you. Technology gives folks ways to opt out – if you can locate it. I realize that sometimes these things can be hard to find – but often a search on Google will land you results – or just ask any late teen early 20s person. They seem to have a solid command on stuff like this these days.

Plaintiff also alleged that Defendants allowed “over 500 people to harass and bully Plaintiff on Facebook.” The alleged allegations of threats by the other users are rather disturbing and won’t be repeated here (though you can review the case for the quotes). However, Plaintiff stated that each time that she reported the harassment she, and others, were told that it didn’t violate community standards. There is more to the story where things have allegedly escalated off-line. The situation complained about, if true, is quite unsettling … and anyone with decency would be sympathetic to Plaintiff’s concerns.

[SIDE NOTE: Not to suggest that I’m suggesting what happened, if true, wasn’t something that should be looked at and addressed for the future. I’m well aware that Facebook (along with other social media) have imperfect systems. Things that shouldn’t be blocked are blocked. for example, I’ve seen images of positive quotes and peanut butter cookies be blocked or covered from initial viewing as “sensitive”. On the other hand, I’ve also seen things that (subjectively speaking but as someone who spent nearly a decade handling content moderation escalations) should be blocked, that aren’t. Like clearly spammy or scammer accounts. We all know them when we see them yet they remain even after reporting them. I’ve been frustrated by the system myself … and know well both sides of that argument. Nevertheless, if one was to take into account the sheer volume of posts and things that come in you’d realize that it’s a modern miracle that they have any system for trying to deal with such issues at all. Content moderation at scale is incredibly difficult.]

Notwithstanding the arguments offered, the court was quick to procedurally dismiss all but the breach of contract claim because the claims were already dismissed prior (Plaintiff apparently re-plead the same causes of action). More specifically, the court dismissed the ADA and Rehabilitation claim because (at least under the 9th Cir.) Facebook is not a place of public accommodation under Federal Law. [SIDE NOTE: there is a pretty deep split in the circuits on this point – so this isn’t necessarily a “get out of jail free” card if one is a website operator – especially if one may be availing themselves to the jurisdiction of another circuit that wouldn’t be so favorable. Again, if you’re curious about ADA Website Compliance, check out the Beebe Law website]. Similarly, Plaintiff’s Unruh Act claim failed because the act doesn’t apply to digital-only website such as Facebook. Plaintiff’s fraud and intentional misrepresentation claims failed because there wasn’t really any proof that Facebook intended to defraud Plaintiff and only the Terms of Service were talked about. So naturally, if you can’t back up the claims, it ends up being a wasted argument. Maybe not so clear for Pro Se litigants, but this should be pretty clear to lawyers (still doesn’t keep them from trying). Plaintiff’s claims for invasion of privacy, negligence, and negligent infliction of emotional distress failed because they are barred by Section 230 of the Communications Decency Act, 47 U.S.C. § 230. Again, this is another one of those situations where decades of precedent contrary to a plaintiff’s position isn’t a deterrent from trying to advance such claims anyway. Lastly, the claims against Zuckerberg were dismissed because Plaintiff didn’t allege that he was personally involved or directed the challenged acts (i.e., he isn’t an “alter ego”).

This left the breach of contract claim. Defendants in this case argued that Plaintiff’s claim for breach of contract should be dismissed because the Court lacks diversity jurisdiction over the claim because she cannot meet the amount in controversy. As the Court explains, “28 U.S.C. §1332 grants federal courts’ original jurisdiction over civil actions where the amount in controversy exceeds $75,000 and the parties are citizens of different states.” Indeed, they are parties are from different states, however, that requirement that the amount in controversy is to exceed $75,000 is where Plaintiff met an impossible hurdle. As discussed prior, users of Facebook all agree to Facebook’s Terms of Service. Here, Plaintiff’s claim for breach of contract is based on conduct of third-party users and Facebook’s Terms of Service disclaim all liability for third-party conduct. Further, the TOS also provide, “aggregate liability arising out of.. .the [TOS] will not exceed the greater of $100 or the amount Plaintiff has paid Meta in the past twelve months.” Facebook having been around the block a time or two with litigation have definitely refined their TOS over the years to make it nearly impenetrable. I mean, never say never, BUT…good luck. Lastly, the TOS precludes damages for “lost profits, revenues, information, or data, or consequential, special indirect, exemplary, punitive, or incidental damages.” Based upon all of these issues, there is no legal way that Plaintiff could meet the required amount in controversy of $75,000. The Court dismissed the final remaining claim, breach of contract, without leave to amend, although the court did add in “[t]he Court expresses no opinion on whether Plaintiff may pursue her contract claim in state court.” One might construe that as a sympathetic signal to the Plaintiff (or other future Plaintiffs)…

There are a few takeaways from this case, in my opinion:

  1. Throwing garden variety kitchen sink claims at platforms, especially ones the size of Facebook, is likely to be a waste of ink on paper on top of the time it takes to even put the ink on the paper in the first place. If you have concerns about issues with a platform, engage the services of an Internet lawyer in your area that understands all of these things.
  2. Properly drafted, and accepted, Terms of Service for your website can be a huge shield from liability. This is why copying and pasting from some random whatever site or using a “one-size-fits-all” free form from one of those “do-it-yourself” sites is acting penny wise and pound foolish. Just hire a darn Internet lawyer to help you if you’re operating a business website. It can save you money and headache in the long run – and investment into the future of your company if you will.
  3. Website Accessibility, and related claims, is a thing! You don’t hear a lot about it because the matters don’t typically make it to court. Many of these cases settle based upon demand letters for thousands of dollars and costly remediation work … so don’t think that it can’t happen to you (if you’re operating a website for your business).

Citation: Lloyd v. Facebook, Inc., Case No. 21-cv-10075-EMC (N.D. Cal, Feb. 7, 2023)

DISCLAIMER: This is for general information only. This is not legal advice nor should it be relied upon as such. If you have concerns regarding your own specific situation, be sure to reach out to an attorney in your jurisdiction who may be able to advise you of your rights.

Anette B.

GoDaddy not liable for third-party snagging prior owned domain – Rigsby v. GoDaddy Inc.

This case should present as a cautionary tale of why you want to ensure you’ve got your auto-renewals on, and you’re ensuring the renewal works, for your website domains if you plan on using them long term for any purpose. Failing to renew timely (or ensuring there is actual renewal) can have unintended frustrating consequences.

Plaintiffs-Appellants: Scott Rigsby and Scott Rigsby Foundation, Inc. (together “Rigsby”).

Defendants-Appellees: GoDaddy, Inc., GoDaddy.com, LLC, and GoDaddy Operating Company, LLC and Desert Newco, LLC (together “GoDaddy”).

Scott Rigsby is a physically challenged athlete and motivational speaker who started the Scott Rigsby Foundation. In 2007, in connection with the foundation he registered the domain name “scottrigsbyfoundation.org” with GoDaddy.com. Unfortunately, and allegedly as a result of a glitch in GoDaddy’s billing system, Rigsby failed to pay the annual renewal fee in 2018. In these instances, typically the domain will then be free to purchase by anyone and this is exactly what happened – a third-party registered the then-available domain name and turned it into a gambling information site. Naturally this is a very frustrating situation for Rigsby.

Rigsby then decided to sue GoDaddy for violations of the Lanham Act, 15 U.S.C. § 1125(a) (which for my non-legal industry readers is the primary federal trademark statute in the United States) and various state laws and sought declaratory and injunctive relief including return of the domain name.

This legal strategy is most curious to me because they didn’t name the third-party that actually purchased the domain and actually made use of it. For those that are unaware, “use in commerce” by the would be trademark infringer is a requirement of the Lanham Act and it seems like a pretty long leap to suggest that GoDaddy was the party in this situation that made use of subject domain.

Rigsby also faced another hurdle, that is, GoDaddy has immunity under the Anticybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d) (“ACPA”). The ACPA limits the secondary liability of domain name registrars and registries for the act of registering a domain name. Rigsby would be hard pressed to show that GoDaddy registered, used, or trafficked in his domain name with a bad faith intent to profit. Similarly, Rigsby would also be hard pressed to show that GoDaddy’s alleged wrongful conduct surpassed mere registration activity.

Lastly, Rigsby faced a hurdle when it comes to Section 230 of the Communications Decency Act, 47 U.S.C. § 230. I’ve written about Section 230 may times in my blogs, but in general Section 230 provides immunity to websites/platforms from claims stemming from the content created by third-parties. To be sure, there are some exceptions, including intellectual property law claims. See 47 U.S.C. § 230(e)(2) there wasn’t an act done by GoDaddy that would fairly sit square within the Lanham Act such that they would have liability. So this doesn’t apply. Additionally, 47 U.S.C. § 230(e)(3) preempts state law claims. Put another way, with a few exceptions, a platform will also avoid liability from various state law claims. As such, Section 230 would shield GoDaddy from liability for Rigsby’s state-law claims for invasion of privacy, publicity, trade libel, libel, and violations of Arizona’s Consumer Fraud Act. These are garden variety tort law claims that plaintiff’s will typically assert in these kinds of instances, however, plaintiffs have to be careful that they are directed at the right party … and it’s fairly rare that a platform is going to be the right party in these situations.

The District of Arizona dismissed all of the claims against GoDaddy and Rigsby then appealed the dismissal to the Ninth Circuit Court of Appeals. While sympathetic to the plight of Rigsby, the court correctly concluded, on February 3, 2023, that Rigsby was barking up the wrong tree in terms of who they named as a defendant and appropriately dismissed the claims against GoDaddy.

To read the court’s full opinion which goes into greater detail about the facts of this case, click on the citation below.

Citation: Rigsby v. GoDaddy, Inc., Case No. 21016182 (9th Cir. Feb. 3, 2023)

DISCLAIMER: This is for general information only. None of this is meant to be legal advice nor should it be relied upon as such.

Anette B.

Section 230 doesn’t protect against a UGC platform’s own unlawful conduct – Fed. Trade Comm’n v. Roomster Corp

This seems like a no-brainer to anyone who understands Section 230 of the Communications Decency Act but for some reason it still hasn’t stopped defendants from making the tried and failed argument that Section 230 protects a platform from their own unlawful conduct.

Plaintiffs: Federal Trade Commission, State of California, State of Colorado, State of Florida, State of Illinois, Commonwealth of Massachusetts, and State of New York

Defendants: Roomster Corporation, John Shriber, indivudally and officer of Roomster, and Roman Zaks, individually and as an officer of Roomster.

Roomster (roomster.com) is an internet-based (desktop and mobile app) room and roommate finder platform that purports to be an intermediary (i.e., the middle man) between individuals who are seeking rentals, sublets, and roommates. For anyone that has been around for a minute in this industry, you might be feeling like we’ve got a little bit of a Roommates.com legal situation going on here but it’s different. Roomster, like may platforms that allows third-party content also known as User Generated Content (“UGC”) platforms, does not verify listings or ensure that the listings are real or authentic and has allegedly allowed postings to go up where the address of the listing was a U.S. Post Office. Now this might seem out of the ordinary to an every day person reading this, but I can assure you, it’s nearly impossible for any UGC platform to police every listing, especially if they are a small company and have any reasonable volume of traffic and it would become increasingly hard to try and moderate as they grow. That’s just the truth of operating a UGC platform.

Notwithstanding these fake posting issues, Plaintiffs allege that Defendants have falsely represented that properties listed on the Roomster platform are real, available, and verified. [OUCH!] They further allege that Defendants have created or purchased thousands of fake positive reviews to support these representations and placed fake rental listings on the Internet to drive traffic to their platform. [DOUBLE OUCH!] If true, Roomster may be in for a ride.

The FTC has alleged that Defendants’ acts or practices violate Section 5(a) of the FTC Act, 15 U.S.C. § 45(a) (which in layman terms is the federal law against unfair methods of competition) and the states have alleged the various state versions of deceptive acts and practices. At this point, based on the alleged facts, it seems about right to me.

Roomster filed a Motion to Dismiss pursuant to Rule 12(b)(6) for Plaintiffs alleged failure to state a claim for various reasons that I won’t discuss, but you can read about in the case, but also argued that “even if Plaintiffs may bring their claims, Defendants cannot be held liable for injuries stemming from user-generated listings and reviews because … they are interactive computer service providers and so are immune from liability for inaccuracies in user-supplied content, pursuant to Section 230 of the Communications Decency Act, 47 U.S.C. § 230.” Where is the facepalm emoji when you need it? Frankly, that’s a “hail-mary” and total waste of an argument … because Section 230 does not immunize a defendant from liability from its own unlawful conduct. Indeed, a platform can be held liable for for offensive content on its service or system if it contributes to the development of what makes the content unlawful. This is also true where a platform has engaged in deceptive practices, or has had direct participation in a deceptive scheme. Fortunately, like many courts before it, the court in this case saw through the crap and rightfully denied the Motion to Dismiss on this (and other points).

I smell a settlement in the air, but only time will tell.

Case Citation: Fed. Trade Comm’n v. Roomster Corp., Case No. 22 Civ 7389 (S.D. N.Y., Feb. 1, 2023)

DISCLAIMER: This is for general information only. None of this is meant to be legal advice nor should it be relied upon as such.

Anette B.

Anti-SLAPP Laws Without Mandatory Award of Fees and Costs is a Hinderance to the Access to Justice and Chills Free Speech

Arizona recently passed a new anti-SLAPP law, 2022 Ariz. HB 2722 (it’s not in effect yet and won’t be for a few months at least) and while a colleague of mine and are are working on a more comprehensive discussion about anti-SLAPP and this new law specifically (which I will link here once done and/or you can always follow me here or on various social media to get the latest) as I was writing the initial draft of that article this week I became more and more frustrated. Anti-SLAPP laws without a mandatory award of attorneys fees and costs to the prevailing party of such motion is a hindrance to the access to justice for real victims of SLAPP suits and chills free speech. How? Let me elaborate.

I should preface this with the fact that I spent the better part of a decade working as in-house counsel of an interactive online forum and I’ve pretty much seen it all when it comes to true victims sharing their honest stories (and being threatened because if it) and bad actors using the Internet as a source of revenge (where people are desperate to make the harassment stop and to remove untruthful, hurtful, information from the platform). As such, my opinion is through a lens of having heard countless stories from all sides.

Generally speaking (obviously there are always outliers) those who lawfully criticize wrongdoers, especially online, do so because they don’t have the means to file suit regarding the experience that led to the criticism. Complaining online is their remedy. If those being criticized are powerful and/or wealthy, it’s really easy to say “Take that content down or I’ll sue you.” Many Americans are living paycheck to paycheck, but even if they are comfortably above that, they often cannot afford to be sued. Just look at how long it took to get through the Depp/Heard case. Granted, that was where two parties were heavily pushing back on who was right … but this is not unlike many civil cases. In fact, the behaviors exhibited in that court room and on display for the watching world to see is not all that unusual for litigating parties. The only difference there is that it was televised and people care enough about celebrity dirt to watch the case unfold on live television/online streaming.

But if you aren’t a celebrity or wealthy individual … if you cannot afford to fight back through expensive lawyers, even if you’re in the right … what do you do? Chances are you begrudgingly remove the content to save your own pocket book, or worse, lose a legal action and end up with a, albeit by default, judgment against you if you cannot, for whatever reason (and there are many reasons) don’t appear in a case. Ahh, yes … the threat of a SLAPP suit is indeed a huge and powerful sword.

But what happens if you cannot remove the content because the website’s terms of service prohibit it, or such posting has been scraped and put up elsewhere such that you do not have control over it? Oh yes, this happens all the time online. People don’t read Terms of Service and unfortunately, copy cat websites scrape content that isn’t theirs. In this instance, chances are, you will get sued anyway. Why? Because it’s worth it for the wealthy/powerful to try to get a court order to remove the content from the internet and they can’t do that without a suit. After all, many platforms will honor court orders for content removal even if they are obtained by default.

And in a lot of ways, this makes sense. Especially when bad actors/defamers hide behind anonymous accounts and/or are in foreign countries that make pursuing the perpetrator cost prohibitive or near impossible for real victims. Real victims need relief and this is one such pathway to remedy. On the other hand, for the truth tellers, it can be hard to stand up to wealthy/powerful bad actors when faced with a lawsuit. Those who speak up honestly can get the short end of the stick. If a suit is filed, and they can’t afford to defend against it, are they to be victimized yet again by default? I know it happens. I’ve seen it happen. Let me give you an example.

Imagine with me for a moment that you are a business owner of a new start-up company called Cool Business, LLC operating in Arizona, and you want to engage the services of a advertising company. Your friend, Tim, gives you the name of Great Advertising Co. based out of New York. A New York advertising company sounds fancy and you think they will probably do a far better job than anyone here in little Arizona so you reach out to them. The conversation goes great, they send you a basic contract to sign for the work to be done for Cool Business, LLC and require a $6,000.00 deposit so they can get started on the work and another $4,000.00 in 90 days for a total contract of $10,000.00 over three months. You skim the agreement, gloss over the headings of the boilerplate terms (because they’re all the same, right?), sign it and send them the $6,000.00. Everything goes great at first, but months into the relationship, and dozens of calls later, you realize that Great Advertising Co. is flakey. They aren’t delivering the services on time, there is always an excuse for why the work isn’t done, but when the 90 days hits, they still ask for their additional $4,000.00 pursuant to the contract. The business relationship at this point has soured. Great Advertising Co. demands their additional $4,000.00 under the contract, which you refuse to pay, and you instead demand a refund of your $6,000.00. Great Advertising Co. refuses to refund you the $6,000.00. Pissed off, you take your story to your favorite business attorney in Arizona and she reviews your contract and advises you that while you may have a breach of contract claim, the terms of your contract say that you agree to litigate any matters stemming from the agreement in a court in New York and that because the contract is with Cool Business, LLC that you’d have to hire a lawyer, in the state of New York, to handle the matter for you because businesses have to be represented by a lawyer in the court that you’d have to file in. Knowing that New York lawyers can be very expensive, you decide it’s not worth the hassle and to cut your losses. Understandably being upset, however, you take to the Internet to tell everyone you know how, truthfully, Great Advertising Co. ripped you off and you explain in detail what happened. You post your reviews to Google, Yelp, Facebook and any other place you can find to help spread the word about these unscrupulous business tactics and you leave it at that. Ten months later you receive a letter from a Great Advertising Co.’s New York lawyer telling you that you need technically still owe the $4,000.00 under the contract and that Great Advertising Co. doesn’t appreciate the negative reviews and demands that you immediately remove them or they will file a lawsuit against you for defamation. You ignore the letter because you know that you have a good breach of contract case and the First Amendment on your side because what you said was 100% the truth and you know, after talking to your favorite defamation attorney a few years back, you know that the truth is a defense to a claim of defamation. A day prior to the one year anniversary of your pissed off customer online posting tirade you are served with a complaint, based out of New York for defamation. You’ve watched the Johnny Depp and Amber Heard defamation trial. You saw how long that case was drug out and you know that you don’t have the funds to pay an attorney to fight for your rights in New York. You didn’t even have the funds to hire a New York attorney to bring a breach of contract case against Great Advertising Co. to try and get your $6,000.00 back. As such, feeling defeated, and without talking to your favorite defamation attorney again, you just ignore the complaint. You figure, what’s the worst that can happen. Great Advertising Co. obtains a default judgment against you individually with an order to take down the content and the judge awards $2,500.00 in damages.

Now, this entire hypothetical, while obviously facts have been changed and such, is based off a true story of what one individual experienced and how these types of situations can go south in a hurry. There are countless similar stories just like this out there. Good folks are victimized not just once, by the initial acts, but twice in some instances like in this hypothetical. But this is where good anti-SLAPP laws come into play.

Anti-SLAPP laws are designed to fight back against those who file lawsuits just to try and silence their critics, but without the promise of attorney fees and costs for the work, victims of little means are hard pressed to find lawyers willing to help (hence the hinderance to access to justice). The sad truth is that most lawyers (like most professions) cannot afford to work for free – being a professional is expensive and it’s not getting any cheaper. When anti-SLAPP laws include such fee provisions, it’s a lot easier for attorneys to consider taking on a SLAPP case, with low or no money down, case because they know they will get paid when they win. This is of course presuming it’s a deep pocket that filed the SLAPP in the first place because the reality is a judgment is only worth one’s ability to collect.

When anti-SLAPP laws fail to include such provisions, there is little deterrent to filing a SLAPP suit. Yes, if the little person being picked on has means, maybe they will think twice but that’s not often the case and the SLAPP filers know, and bank on, the litigation causing financial hardship or stress so that the truth teller will simply give in to the demands to remove the content prior to even answering the complaint, thus chilling truthful speech. It’s a powerful tactic. If it wasn’t, there wouldn’t be so many states with anti-SLAPP laws trying to curb such problems in the first place.

As many legal practitioners are painfully aware, it can be very difficult to get a judge to award attorneys fees and costs absent it being statutorily required. So even if you fight against a SLAPP suit, and win, you could still be out tens of thousands of dollars (or more depending on the case) with no guarantee of recovery. As an attorney, when you have to tell potential clients this, you can see the defeat in people’s faces before you even get going. It’s scary. What average person has tens of thousands of dollars laying around to pay to a lawyer to fight for their First Amendment right to free speech?

Would those odds make you excited about standing up for yourself? I think not. If you knew all this, would you be so willing to share with the public honest information about bad actors and you personal experience? I think not.

And this doesn’t just go for complaining consumers, but also for investigative journalists. If you think a random, but bigger company, going after an unhappy customer who got ripped off is bad and complained about it is bad … imagine what a powerful elite will try to do to an investigative journalist trying to uncover some very serious dirty laundry and expose it to the world?

Bottom line, for any anti-SLAPP law to be a true shield, among other things, it must contain, at minimum, a statutory award of attorney fees and costs.

Disclaimer: This is for general information purposes only and none of this is meant to be legal advice and should not be relied upon as legal advice.

#firstamendment #defamation #antiSLAPP #legislation #accesstojustice

Anette B.

Legal fees: 7 ways that YOU may be contributing to a higher legal bill

No one loves legal fees and with the advent of the internet, and all of these “free” forms and information online that people now have access to, many lay people seem to think that paying for a lawyer’s time is overrated or that you could have obtained the same information elsewhere for a fraction of the cost. If you are starting with that mindset, you are setting yourself up to be frustrated with your lawyer and with the inevitable bill. If that is you, save yourself and your potential lawyer some aggravation…don’t engage an attorney. Take your chances with whatever you can find online, which may or may not be right for you and your situation, and run with it. No, really. It’s not with the frustration for either of you. No business, lawyers/law firms included, want to deal with a disgruntled client/customer that is going to nickel and dime them because they think they could have gotten a better deal elsewhere. There may always be someone “better qualified” or “cheaper” although the two don’t usually coincide with one another. The question then becomes, can you have a good working relationship with your lawyer? That’s what you really want.

If you do decide to move forward with an attorney, understand that there are things that YOU might do that can make your lawyer bill even more expensive:

1) Thinking that your situation is “simple” and being stuck in that mindset even when you are told that your situation isn’t “simple.” The matter may be simple to you, but that’s because you aren’t going to think of all the same things your lawyer is. Most matters are far more complex, and have way more moving components, than what a client thinks. The more complex a matter is or the more complex the lawyer says it is, the higher the bill will likely be. Expect it. Also, no lawyer worth their salt will say “this is a slam dunk case.” If they do, run!

2) Taking a free legal template document (which is SO basic it that it likely doesn’t actually cover what you need to accomplish your goals) and asking a lawyer to review it. Chances are, no lawyer is going to look at that and think that it is a legal masterpiece; but you are going to pay them to look at it anyway, and it’s likely going in the garbage. If that is where you are starting, you are better off asking the lawyer to draft and agreement or other legal document from scratch. At least then you aren’t paying for their time to read something that they likely won’t use in the first place.

3) Not being forthcoming with information to begin with. You have to remember that your attorney doesn’t know the matter or the parties like you do. It is up to you to help get your attorney up to speed on all the specifics and timely provide them with the information they request, by the deadline they give you. Similarly, if circumstances material to your situation change, you need to tell your attorney right away. You also have to remember that if your attorney’s job is to help protect you from some other party or risk, they are going to assume, and try to prepare for, the very worst. If you have a good lawyer, they are likely going to dig and ask questions to help them do that. Some questions you may not be comfortable answering because you might feel it casts you in a bad light or is otherwise harmful to your case/matter, but it is best to answer them anyway because if you don’t, and your attorney is suspicious of the situation, they will dig for themselves and you will be expected to pay for their digging. Besides, chances are, your lawyer has heard a lot worse than what you are likely going to tell them. Think of it as talking to your doctor. If you want proper treatment, you have to divulge all the details.

4) Providing hasty inadequate answers to, or otherwise failing to actually address, your lawyer’s questions. It is a bad idea to use email or text communications like a “chat” system with your lawyer unless you want to be billed a .1 (6 minutes) for each and every communication you send and receive. Make your communications worthwhile, and provide real thought out substance, before you hit “send.” Along the same lines, if a lawyer doesn’t feel they are getting the whole story, a good one will dig for more information to find the answers to their questions and it will likely be done at your expense. It’s better to be forthcoming and provide as much information as is requested or possible (it’s better to over disclose than under disclose) and provide such information in a methodical and organized manner as you can. Don’t just dump a bunch of papers in a box and say “Here ya go!” Your lawyer will charge you the time it takes to organize all of the materials. Similarly, if you fail to answer all of the questions that your lawyer asks you, your lawyer will follow up again or find a different route to obtain the same information. You will be charged for each follow up communication and for the additional digging your attorney feels is required.

5) Providing incorrect answers to your lawyer’s questions. A good lawyer will trust the information they are given but will also verify the information provided. If your attorney finds even one answer wrong/inconsistent from prior statements given to them by you, they are not going to trust what you (or whoever) are telling them and will have to verify all of the information given to them. You should always back up your statements with the documents supporting your statements. The more time your lawyer has to spend verifying the accuracy of the information that has been provided, the bigger the bill.

6) Not heeding warnings and advice of your lawyer. A lawyer can never protect you from all risk, but they can tell you when there are major red flags and discuss ways to avoid it going forward. Asking your lawyer to move forward, especially when you want to be cutting corners on recommended due diligence, increases the risk of the transaction or situation and also makes the attorneys job 10 times harder than it needs to be. This is because without the proper information they have to try to plan for, and anticipate, all of the unknowns. The longer and harder your lawyer has to think, especially where there are unknowns, the higher the bill is likely to be.

7) Being “needy.” Attorneys aren’t often referred to as “counselors” for nothing. Many situations can be very emotional and often people want to rely on their attorney for emotional support, a safe ear, and a constant source of reassurance. It happens to the best of us! At the same time, if you are the type of person that desires a lot of interaction and attention from your attorney, you should plan on and be prepared for, a higher bill. Why? Well, you have to think that even though you are a valuable client, chances are, your lawyer has other clients and projects. If they are in the middle of a project, and you call or keep sending text messages or emails, that interrupts their train of thought and their attention is diverted to you. Your attorney has to reorient their brain to address your call, text or email and then, when they are done with your matter, they have to again reorient their brain back to whatever it was they were working on and try to figure out where they were. It can be much like working from home when you have a few small, and otherwise unattended, children. The time that they give you to vent, be it on the phone, text or via multiple emails, and the time it takes them to reorient themselves back to their prior project, may very well end up on your bill and you should expect it. Just assume a .1 (or 6 minutes), at least, to be on your bill, for every communication you initiate, regardless of the medium (e.g., email, text message, phone call). Your attorney may be kind and write off some time, but you shouldn’t expect it.  Think about it … would you go to work and then tell your boss to deduct money from your pay check even though you spent time on work projects for your boss? A lawyer’s time IS that lawyer’s product and you shouldn’t expect it to come free or at a discount.

Lawyers can be expensive, but you can lessen the financial burden by giving a little more consideration to how you interact with your lawyer. The more work , following up, or hand-holding they have to do, the bigger your bill will likely be, regardless of how “simple” you think a task is. Help them, help you, keep your legal bills lower by being mindful of your interactions with your attorney.

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.

Anette B.

Domesticating a Foreign Subpoena in Arizona

So you have initiated legal action in your local state court but an entity or person that you need information from is based out of or otherwise located in the state of Arizona.  What do you do?  Well, if you want someone to tell you how to do it (yep, step by step instructions) or otherwise don’t really want to mess with it much at all, you can seek help from Beebe Law, PLLC.  Simply start by filling out the Arizona State Subpoena Domestication Intake Form.  If you just want to learn a little more…keep reading.

Every state has their own unique set of laws and procedures when it comes to domesticating a foreign subpoena and Arizona is no exception.  The following are a few important points:

  1. Make sure you know who the entity’s statutory agent is and where they are located.  You should be able to find this by searching the Arizona Corporation Commission’s website.
  2. Ensure that you are complying with Arizona’s Interstate Depositions and Discovery rules.
  3. If you are asking for medical records or anonymous author information, there are special rules/laws surrounding that you will need to research.
  4. If you are commanding attendance at a deposition or hearing be sure you are doing it at a location consistent with the rules.
  5. Don’t forget your witness fees!
  6. You will have to arrange to have the subpoena served, e.g. through a process server.

Many can absolutely accomplish the goal of foreign subpoena domestication in Arizona entirely on their own (as long as you pay close attention to the rules) however, if you are unsure of the process, or otherwise just don’t want the hassle of it, feel free to reach out to us.  We are here to help you navigate and/or take over the nuances and have created an entire Foreign State Subpoena Domestication Intake Form to get you started.

If you are in need of assistance with laws and procedure 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 and individual 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.  
Anette B.

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.  

 

Anette B.

ADA Compliance and Websites: Yes, it’s really a thing.

I’ve said it before…it seems like everyone today has a website.  Whether you are a stay at home mom blogger, operate an e-commerce boutique shop, a local mechanic shop with a basic website or a full blown tech company – chances are you are no stranger to the internet and websites. Websites are how people find and interact with you or your company. Depending on what your website is designed for, you may have more risks to consider.  For example, as I recently discussed, if your website hosts third-party content, there are risks associated with that kind of a website.  Similarly, if your website collects email addresses so that you can later market to them, that presents an email marketing risk. This article is going to briefly discuss a new potential risk for website operators – that is compliance with the Americans with Disabilities Act of 1990 (ADA).

You might be thinking: “How could a website become an issue with the ADA?”  That was my initial reaction too until I considered people who are blind or have a hearing impairment.  It’s easy to take for granted senses that we are used to having.  Think of all the “closed captioned (cc) for the hearing impaired” text that we have heard/seen on the television in the past.  Well, how does that work for those videos that you are making and posting to your website?  How do people navigate your website if they can’t see? Until a recent conference I had never even thought about how a visually impaired person accesses the internet.  I have since discovered that the visually impaired often access the internet through a special screen reader.  JAWS seems to be the most popular and I found a few interesting YouTube videos that give a demonstration of the JAWS program from different perspectives.  If you are curious, like I was and want a unique perspective that may help you with your website accessibility, you can see two of the links I found HERE and HERE.  The second video is from a student’s perspective which has a lot of good insight – including difficulties with .pdf documents, etc.

The above examples coupled with the legal actions that have been taken against websites in relation to an ADA claim, and the fact that I am starting to see solicitations from Continuing Learning Education companies teaching attorneys how to initiate actions, sends a solid message that this is something people/businesses need to be thinking about as they move forward with their existing websites and/or build out  new websites.

THINGS TO KNOW AND UNDERSTAND:

  • The Americans with Disabilities Act of 1990 (ADA) prohibits discrimination and ensures equal opportunity for persons with disabilities in employments, State and local government services, places of public accommodations, commercial facilities, and transportation.
  • These laws can be enforced by the Department of Justice (DOJ) through private lawsuits and indeed there are cases where the DOJ has specifically stated in rulings that websites should be designed so that they are accessible to those who have physical disabilities including vision and hearing.
  • The DOJ has already required some websites to modify their sites to comply with the ADA guidelines – see the Web Content Accessibility Guidelines (WCAG) 2.0.
  • There is no set required standards YET but it’s expected soon and they may require compliance within 12 months from the date of publication of the new standards to the public register.  If you have a big website, and perhaps a lot of changes that will need to be made, that isn’t a lot of time.

WHAT IS BEING LOOKED AT FOR COMPLIANCE?

WebAIM.org appears to be a pretty decent resource for information.  They have a pretty comprehensive checklist that may assist you and your website developing team out, however, below is a few points for consideration:

Information and user interface components must be presentable to users in ways they can perceive.

  • Guideline 1.1: Provide text alternatives for any non-text content so that it can be changed into other forms people need online – think of large print, speech, symbols or simpler language.
  • Guideline 1.2: Provide captions and alternatives for multimedia.
  • Guideline 1.3: Create content that can be presented in different ways (for example a more simplistic layout) without losing information or structure.
  • Guideline 1.4: Make it easier for users to see and hear content including separating foreground from background.

User interface components and navigation must be operable.

  • Guideline 2.1: Make all functionality available from a keyboard.
  • Guideline 2.2: Provide users enough time to read and use content.
  • Guideline 2.3: Do not design content in a way that is known to cause seizures (like flashing content)
  • Guideline 2.4: Provide ways to help users navigate, find content, and determine where they are.

Information and the operation of user interface must be understandable.

  • Guideline 3.1: Make text content readable and understandable.
  • Guideline 3.2: Make web pages appear and operate in predictable ways.
  • Guideline 3.3: Help users avoid and correct mistakes.

Content must be robust enough that it can be interpreted reliably by a wide variety of user agents, including assistive technologies.

  • Guideline 4.1: Maximize compatibility with current and future user agents, including assistive technologies.

WHAT IF MY WEBSITE ISN’T COMPLIANT?   

For websites that aren’t compliant the following are some things you should consider:

  • Have a 24/7 telephone number serviced by a live customer service agent who can provide access to the information on the website – the phone number must be identified on the website and be accessible using a screen reader.
  • Consider starting to make adjustments to your website to help ensure you are compliant.

NEED HELP ENSURING COMPLIANCE?

It is always a good idea to get a formal legal opinion on these kinds of matters if in doubt. Being proactive is a far better position to be in than being reactive and in a time crunch and money might be tight. If you are in the state of Arizona, and need help with suggestions on how to help make your website ADA compliant or would like to discuss this topic generally so that you have a better understanding of how this issue might impact your business, Beebe Law, PLLC can help!  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.  

 

 

Anette B.

Email Marketing | Non-Compliance with CAN-SPAM Can Be COSTLY!

So many businesses now rely on email marketing to help generate traffic and revenue. However, failure to comply with the rules set forth in the CAN-SPAM Act could be financially ruinous!

The Federal Trade Commission (“FTC”) explains that the CAN-SPAM Act “is a law that sets the rules for commercial email, establishes requirements for commercial messages, gives recipients the right to have you stop emailing them, and spells out tough penalties for violations.”  Just how tough of penalties you ask?  Try penalties up to $40,654, for each separate email, found to be in violation!

Uneducated businesses owners, trying to save a buck by doing email marketing for themselves in lieu of a more traditional professional service, may very well unknowingly send out emails that are in violation of the rules set forth by the CAN-SPAM Act.  In fact, in spite of the connotation that might stem from its name, CAN-SPAM doesn’t just apply to email messages that are sent in bulk – you know, like what you would normally think of as “SPAM.”  The rules under the CAN-SPAM Act apply to ALL commercial email messages that are for the primary purpose of commercial advertisement or promotion of a commercial product or service.  Even emails that are to a former customer, maybe announcing a new product or service, has to comply with the CAN-SPAM Act rules….or else…potential OUTRAGEOUS penalties.  Let’s assume that you email 100 former customers; those emails were not compliant with CAN-SPAM, and assuming maximum penalties would be awarded against you, that would be $4,065,400!  Yes, you read that right.

THE MATH:  100 (non-complying emails to people) x $40,654 (the maximum penalties for violation) = $4,065,400.

Fortunately the rules are not all that difficult to comply with and the FTC’s website has provided a Compliance Guide for Business.  The basics include the following:

  1. Don’t use false or misleading header information.
  2. Don’t use deceptive subject lines.
  3. Identify the message as an advertisement.
  4. Tell recipients where you are located.
  5. Tell recipients how they can opt out from receiving future email from you.
  6. Honor opt-out requests right away.

One other key thing to remember is EVEN IF you rely on someone else to do mass email marketing for you, YOU ARE STILL RESPONSIBLE!  You cannot turn a blind-eye to your advertising communications and expect to go unscathed if those communications do not comply with the law.

It is always a good idea to get a formal legal opinion on these kinds of matters if in doubt. If you are in the state of Arizona, and are seeking assistance with ensuring that your marketing emails, are in compliance with the CAN-SPAM Act, be it ones you created yourself or if you want to double check what your marketing vendor is doing,  Beebe Law, PLLC can help!  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.  
Anette B.

So You Want to Run a Website: Common Risks When Hosting Third-Party Content

It seems like EVERYONE today has a website.  Whether it be a personal blog to a full scale business – websites are how people “find” and often “interact” with you today.  However, just like any business, it doesn’t come without risk.  This article will address a few of the most common areas where a website operator can incur liability if they want to host third-party content (i.e., you want to allow people to post and/or comment on postings).

To begin with, as I have referenced in my prior articles regarding Troubles with Defamatory Online Reviews and Content Scrapers, That Would be Harsher Punishment for internet Defamers Stan, Why Google De-Indexing May NOT be an Effective Reputation Management Solution, etc., at least in the United States, the federal law often referred to as the Communications Decency Act, aka Section 230 or the “CDA” generally immunizes websites from third-party content.  In layman’s terms, this means that an internet service provider, such as a website, is not typically liable for content written by a third-party.  That does NOT, however, mean that you don’t have to be cautious.  In fact, the intricacies of the law surrounding the CDA can be quite complex.  It would be tragic for an unsuspecting business to be sued into bankruptcy over preventable little mistakes.

The following are a few common areas of potential liability:

INTELLECTUAL PROPERTY:  Intellectual Property, including claims of Copyright and Trademark Infringement are NOT barred by the Communications Decency Act.  If a third-party puts content on your website that infringes on someone else’s Copyright or Trademark, you could be held liable.

DEVELOPING CONTENT:  Depending on how you solicit and/or edit a third-party’s content you could be held liable.  Many of plaintiffs have argued against website’s editorial decisions or even what sort of requirements/fields are built in for website users to enter information into, can take them outside of the protections of the CDA.

If you are considering starting up a new website or a business with an existing website it is wise to take these matters into account at the very beginning, or as soon as otherwise practicable.  Moreover, individuals and businesses are wise to consult an internet lawyer that practices in internet law when beginning to lay out their business plan for their website.  A consultation fee now can save you THOUSANDS in the long run.

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.  If you are in the state of Arizona, and seeking consultation in the area of infringement relating to Copyright, Trademark, or other risks associated with being a website and hosting third-party content, contact Beebe Law, PLLC today.

 

 

 

 

Anette B.

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.
Anette B.

Should websites be able to raise objections on behalf of their anonymous users? A California Appellate Court thinks so – Glassdoor v. Superior Court (Machine Zone, Inc.)

While I sometimes think that the California courts can get things wrong, e.g. Hassell v. Bird (2016) 247 Cal.App.4th 1336, rev. granted, (thank goodness) they also, in my opinion, can get things right.  On March 10, 2017, the Sixth Appellate Court for Santa Clara County, California in the matter of Glassdoor, Inc. v. Superior Court of Santa Clara County (Machine Zone, Inc.), under Case No H042824, concluded that Glassdoor  (a website in which workers can post their own reviews about past or current employers) has standing, i.e, the authority, to assert an anonymous user’s interest in maintaining his anonymity against Machine Zone’s efforts to compel Glassdoor to identify him/her.  Can I get a fricken hallelujah!

Clearly I am elated by this ruling.  This is not only good for people who write honest reviews but also for websites that allow third parties to post content on their websites.  In my line of work I have seen parties file claims against anonymous authors sometimes alleging causes of action that wouldn’t even stand up to basic case analysis of the statute of limitations let alone anything more complicated like ensuring they have met the requirements that are necessary under state law in order for a website to release and anonymous author’s identifying information.  These parties will then submit their subpoena or some form of discovery order to a third-party website like Glassdoor and demand production of the identifying author information.  If the website’s subpoena compliance department is lead by anyone like me, chances are they have an entire checklist of criteria for their respective state that must be met prior to production.  Here in Arizona the controlling law is Mobilisa v. Doe (App. 2007) 217 Ariz. 103, 114-15, 170 P.3d 712, 723-24.  Mobilisa requires that a requesting party show: 1) that the anonymous author has been given adequate notice and a reasonable opportunity to respond to the discovery request (which itself has specific requirements that have to be adhered to); 2) that the requesting party’s cause of action could survive a motion for summary judgment on the elements of the claim not dependent on the identify of the anonymous author (and that requires more than laying out a mere prima facie case); and 3) a balance of the parties’ competing interests needs to favor disclosure.  Indeed, Mobilisa sets out some hoops that requesting parties have to jump through in order to try and protect the rights of an anonymous author and if requesting parties don’t conform, chances are that subpoena is going to be met with objection.

While I haven’t seen it all that often, I can think of a few instances where counsel was met with my objections and they tried to argue that the website lacked standing to raise such objections.  Typically I find this to be the biggest cop out – nothing more than an effort to circumvent the rules – especially when they are met with legitimate objections like statute of limitations or failure to meet other requirements.  Many websites, like Glassdoor, will fight this if challenged and I’m pleased to see this outcome.

Absolutely the anonymous author has their rights and can assert them on their own behalf but there are many reasons why an author may not stand up and defend.  What if the author doesn’t get notice of the matter?  I have personally seen some suspicious activities going on in the past and UCLA Law Professor Eugene Volokh and Public Citizen Litigation Group attorney Paul Alan Levy have helped raised awareness about many of the same concerns that I have had.  Take for example their Washington Post article which discusses “Dozens of suspicious court cases, with missing defendants, aim at getting web pages taken down or deindexed.”  What if the author lacks the knowledge to even understand that they have a defense?  The minute that a lawsuit gets filed defendants tend to get scared – especially if they are not in a solid financial position.  It’s not uncommon for an author to stand behind their story but fear the litigation and so they bury their head in the sand in hopes that the matter will “go away.”  They may not even consider the fact that they have a defense.  It’s not as if many people have legal knowledge -even the basics – and legal departments of websites can’t be giving people legal advice.  What if the author told the truth and cant afford a defense?   Here again I am aware of a situation where a person wrote a review – alleged that the story was truthful, but got sued in another state over the posting and couldn’t afford to appear and defend the situation in the other state.  How is that justice?  I’m sorry ma’am/sir – your right to free speech is only to the extent your pocket book can pay for a defense?  

Now I’m not suggesting that websites take on the litigation defense of all of their users – that would not be economically feasible.  Websites usually have no unique knowledge that would put them in a position to argue truth as a defense or anything like that.  However, I think websites who want to help protect their anonymous authors should have the ability to stand up to those who may be simply trying to take advantage of an anonymous author’s vulnerabilities through basic objections.  If you are making claims that are so far outside the statute of limitations it isn’t even funny, OBJECTION.  You’re case couldn’t stand on it’s own anyway.  If you aren’t following the correct process under the applicable law to ensure that an author has the appropriate notice and reasonable opportunity to defend, OBJECTION.  You can always attempt to cure the deficiencies and try again.  If you can’t – well, then you probably don’t have much of a case in the first place.  It’s a whole lot easier for a website’s legal department or subpoena compliance department to look at a situation and say “Nope, try again…” or “Nope, not happening…” than it is for a user to try and teach themselves the law or hire expensive counsel (face it – even the cheap attorneys aren’t “cheap”) to teach them the law and make the same objections on their behalf – within a short period of time.

I am so glad that the Glassdoor court recognized some of these issues and considered the potential for chilling effects on free speech.  As the Court points out in Glassdoor, “…some attacks on anonymity may be mounted for their in terrorem effect on potential critics.” Glassdoor at p.12.  This is a fantastic ruling and you can review the entire 33 page ruling below or by clicking HERE.

Until next time friends…