Legal Phenomena for Online Businesses

As social media becomes one of the front stream platforms for growing businesses, one must understand how to protect these practices. Currently, many business owners are turning their Facebook pages into online stores or platforms for advertising and promoting brands and companies of others. Is this type of business afforded the same legal rights as other entities in similar or same fields? Of course it is because a business is a business regardless of its structure. There are a number of essential legal issues that must be considered prior to starting an online business.

Similarly to offline businesses, online businesses shall 1) Incorporate their business (LLC or Corp) 2) Protect their Intellectual Property (Trademarks, Copyrights and Patents) and 3) Draft agreements that will protect the interests of the business and its owners, employees and such. Furthermore, there are other liabilities that may arise for online companies such as spamming issues, defamation, privacy and protection of consumer data and other issues that can be unique in nature for these types of companies. Nevertheless, in this article I will focus on the intellectual property rights.

Intellectual Property

In order to diminish legal liability for online companies, a company shall choose to market and function under a brand name that is strong and unique. For example, if an online company is investing money and time into marketing a brand for their goods and/or services, however hasn’t conducted a trademark search, filed for a trademark, and/or obtained a trademark, then the company is taking a huge risk that the mark that it is marketing is actually taken and as a result, the company opens a door to possible litigation and would need to rebrand or in a worst scenario deal with an infringement lawsuit. Hence, trademarking your brand, whether it’s an online business or not is equally important. For example, if an individual started a Facebook page on which he/she advertises goods and/or services of third parties, the name of this page will probably need to be trademarked because essentially this name is the individual’s brand under which he/she is conducting their business. Hence, it would be important to check whether there are other companies with similar names that offer similar services/goods.

In order to protect online businesses, Facebook went as far as creating a form for the owners of trademarks to complete, in order to enforce intellectual property rights online, to deter others from using registered trademarks of others as their username. The form can be found here: http://www.facebook.com/help/contact.php?show_form=username_rights

Similarly, on twitter and instagram, if an online business owner reports an account/username that is infringing upon its trademark(s) and twitter/instagram determine that a violation truly exists, they will suspend the foregoing account(s). Report a trademark issue here:

Twitter

https://support.twitter.com/forms/trademark

Instagram

https://help.instagram.com/contact/111608122342794

Additionally, obtaining Copyright protection is also necessary, depending on the scope of the online company and its goods and/or services. In most scenarios, Copyright right protection attaches to pictures, videos, blogs, music, books and a number of other forms of expression presented on a website. Most Internet users are exposed to copyright implications, regardless if they are a user or creator of content.

Furthermore, if an online company specializes in offering social networking services where users can register and upload content, then one must be aware of the protections afforded by the Digital Millennium Copyright Act (“DMCA”). The DMCA contains what are referred to as “safe harbor” provisions. These provisions may shield an online business owner from “liability for the copyright infringements of your site’s users and for your provision of links to copyright-infringing material from other Internet sources as long as you have effective notice-and-takedown procedures, promptly remove content when a copyright owner notifies you that it is infringing and have no actual or effective knowledge that the posted material is infringing”[1].

As the world is transforming into a digital hub, the courts and business owners of online businesses are stumbling over legal issues, which have no precedents. As such, new rules and regulations that pertain to such issues are being enacted frequently. It is Important for online business owners to educate themselves about these new trends and incorporate them into their businesses.

 

[1] Protection for infringing material posted by others: DMCA safe harbor provisions, Reporters Committee for Freedom of Press, https://www.rcfp.org/browse-media-law-resources/digital-journalists-legal-guide/protection-infringing-material-posted-oth