A Crash Course in ECommerce Legal Issues
Here at eCommerce we had the opportunity to talk with Jim Chester, Senior Partner with Klemchuk Kubasta LLP, specializing in patent and trademark law. Jim heads the new eCommerce group, which focuses on legal issues for online businesses. I asked Jim to give me a perspective on what companies should be aware of (possible pitfalls, legal issues, etc.) of starting their own eCommerce company.
1. What is the first thing an executive needs to do when launching a new eCommerce site (from a legal perspective)?
Jim: Overall, an appreciation of the wide range of legal issues (including regulatory, contract, intellectual property, etc.) is important for understanding the types of matters that will need to be addressed. Getting the domain registered and associated trademark registration applications on file is important early on. Also, they must ensure that they have written agreements with all folks developing and creating content for the site to ensure that the company will own all the IP (intellectual property) that is created.
2. What are some common legal mistakes eCommerce sites have made / make?
Another common mistake involves hiring contractors to design logos, websites, web content, etc. Under copyright law, these contractors will own the rights to these items unless/until they transfer those rights to the company - and not simply when the company pays for their services.
3. What are some little known pitfalls that eCommerce sites can fall into, if you aren’t watching out?
4. What can you do to protect your eCommerce site (your employees, products, etc.)?
Jim: There are a number of strategies we can employ to protect an eCommerce company. Spending a little more on legal on the front end will generally save many times that later on. eCommerce companies need to invest in solid Policies and Terms, and ensure ownership of all intellectual property associated with the site. In addition, registering marks with the USPTO is one of the most "bang for the buck" things any company can do. Also, keep in mind that laws and "best practices" change - and Terms and Policies should change with them.