Running a business online comes with a host of significant legal issues and concerns that are either less important or complete absent in a brick-and-mortar store. Understanding the potential sources of liability and risk is the first step towards protecting yourself and your business' brand.
The small business lawyers at the Katz Law Group have spent the last four decades representing business owners, including many who are completely online. Here are 3 legal issues that they think online business owners should be aware of.
1. Data Protection
E-commerce websites generally collect a significant amount of sensitive data on their customers, particularly if payments can be made on the website. That data can include:
- Customer identification information, including their name and address
- Credit card information
- Cookies and other information about how the customer interacted with the website
Some U.S. states and the European Union have strict laws about when websites can collect this information and how it must be stored securely to prevent a data breach. Even if you do not operate in the E.U. or one of these states in the U.S., if you have customers from one of those jurisdictions, your website can violate the law. As attorney David Katz says, "Many online business owners do not appreciate the number of data privacy laws that they have to comply with, as these laws apply to and protect the customer, not the business."
2. Intellectual Property Infringement
If your company does business online, then it probably has a website and social media accounts. That website and those accounts have content on them, including text and images. It is absolutely crucial for online business owners to make sure that they only use content that is licensed for commercial use, and that they do not infringe on another party's intellectual property rights.
The same holds true for your own intellectual property. Apply for copyrights and trademarks to protect your company's intellectual property to protect it from infringement by others, and then keep your ear to the ground for unauthorized resellers of your products. If you find one, you have legal recourse.
3. Terms of Conditions and Contracts
There is a reason why every major online retailer has Terms and Conditions, or T&Cs, for every sale that it makes: Going without them can expose an online company to a wide range of liabilities if the product proves to be defective or if the customer just wants to return it. Having T&Cs in place provide certainty about what the next steps are, and give you, as the business owner, the opportunity to control how things proceed. This is another chance to establish your business' brand: Will you lean towards helping customers return products at the risk of losing some revenue, or protect your bottom line at the risk of some harm to your business reputation?
Small Business Lawyers at the Katz Law Group
These are just some of the most important issues that online businesses face. The business and contract lawyers at the Katz Law Group can help you navigate the risks and protect yourself and your business' future. Contact them online or call their law firm in central Massachusetts at (508) 480-8202.
