Tuesday, October 31, 2017

Basic Website Purchase and Sale Agreement

Here is a basic website sale agreement.

This Website Asset Purchase Agreement (the "Agreement ") is made effective on ____________, 2017 (the “Effective Date”), by and between _____________________, of _________[address]__________________________ (the "Seller"), and _________________, of _________[address]__________________________ (the "Buyer ").

The Seller hereby sells and transfers to the Buyer any and all of Seller's rights, title and interest in/to the Website and Internet domain name ___________.com and all of its respective contents (the "Website "), and any other rights associated with the Website, including, without limitation, any intellectual property rights, all logos, customer lists and agreements, social media accounts, email lists, passwords, usernames and trade names, and other Purchased Assets more specifically identified on Exhibit "A" hereto.

In consideration for the sale of the Website and Purchased Assets, the Buyer agrees to pay $___________ (the “Purchase Price”) to Seller within ____ days of the Effective Date.

Wednesday, October 25, 2017

Forms of Business Entities in the US



A sole proprietorship is owned and run by one individual (although a husband and wife can qualify as sole partnership) who is personally liable for all losses and debts. It is the most common form of starting a new business because it is the simplest and least expensive type of business to establish.
Can be established instantly without filing any paperwork.
Profits or losses reported on a federal Schedule C. No separate tax filing required.
No need to pay unemployment tax on oneself.
Unlimited personal liability. Purchasing insurance is highly advisable.
Investors tend to disfavor SPs and prefer a more formal entity.

Wednesday, October 18, 2017

Amazon FBA Legal Considerations

The Fulfillment by Amazon (FBA) business model is popular because it makes it easier for entrepreneurs to grow their business without having to deal with the logistics of warehouses, packaging materials, couriers, etc. Amazon warehouses your products, packs and ships them to your customers. With private labeling, you can also establish your own brand to increasing the value of your business.

Dealing with hijackers/piggybackers

- Stylize and distinguish your product. E.g., include subtle engravings, add surprises in the packaging.  The more unique you make your product, the easier it will be for you to prove that the copycats are infringing.  The more similar the latter are to your unique product, the stronger your legal claim.
- Register your product with the Amazon's Brand Registry. Note that you can't sell a generic product against a branded listing.
- Bundle your products, it makes them less attractive to piggybackers. 
- Trademark and copyright with the U.S. Patent and Trademark Office and the U.S. Copyright Office.
- Send a cease and desist letter, preferably from a lawyer, to the hijacker. Get the lawyer to create a template C&D letter that you can re-use by filling in the blanks.
- Consider buying one of your products from the hijacker.  That seems counter intuitive because it will boost their rating and give them profit. However, the benefit to you is that, after studying the product, it will be easier for you to prove that it’s not the same one you are selling. File an A-to-z Guarantee Claim with Amazon.

Tuesday, October 17, 2017

Supreme Court Refuses to Nullify Google Trademark

On Monday, the Supreme Court declined to review a legal challenge that the term "google" has become too generic and therefore should not be protected by trademark. The lawsuit was brought by Chris Gillespie who had registered 763 domain names that included the word "google." Google Inc. filed a cybersquatting complaint under the Uniform Domain Name Dispute Resolution Policy and claimed trademark infringement. Mr. Gillespie lost and was ordered to forfeit the domains. He appealed but lost on all court levels.

His lawsuit alleged that the word "google" had become synonymous with the term "search the Internet."  When words become too generic, companies that hold trademark rights to them lose those rights. This phenomenon is  known as "genericide." Words like teleprompter, thermos, hoover, aspirin, and videotape were once trademarked but lost the legal trademark status after they became too generic.

That's why Velcro last month came up with a video urging consumers to stop calling the stuff "velcro" unless it is officially a product of the Velcro Companies. They, too, are worried they'll fall victims to genericide and lose their Velcro trademark.

But for now Google will keep its trademark because the courts determined that, even though the dictionaries started including the verb "google," it has not yet become an exclusive term for "search the Internet." The appeals panel said trademark loss to genericide occurs when the name has become an "exclusive descriptor" that makes it difficult for competitors to compete unless they use that name. For now, people understand that "to google" only applies if they are searching the Internet using the actual Google and competitors can compete without having to use the word "google."

Sunday, October 8, 2017

Raising Capital from Foreign Investors

Foreigners can invest in U.S. securities offerings easier than U.S. persons. That's because the Securities Act of 1933 protects U.S. investors by placing numerous restrictions on securities offered to U.S. persons. However, those restrictions do not apply to foreign investors who invest under Regulation S of the Act. Note that the issuer of securities can decide to treat foreign investors as the same as U.S. investors, in which case all of the same restrictions will apply to both U.S. and foreign investors. But, if the issuer wants to simplify the process for foreign investor, the issuer can rely on Regulation S.

Sunday, October 1, 2017

New EU Trade Mark Regulation

Today, the latest changes to the EU trademark system become effective. They are:

1. Graphical Representation Unnecessary

The graphical representation requirement no longer applies for trademark applications submitted on or after October 1, 2017. This means that, from that date, marks "can be represented in any appropriate form using generally available technology, as long as the representation is clear, precise, self-contained, easily accessible, intelligible, durable and objective."

In other words, ‘what you see is what you get.’  Sounds and colors are now explicitly registrable.

2. EU Certification Marks

This is a new type of mark at the EU level, although some member states had allowed certification marks at the national level before the new rules. This type of mark makes possible for a certifying entity to permit third parties to adhere to the certification system to use the mark as a sign for goods and services, as long as they comply with the certification requirements.

Saturday, September 30, 2017

New French Law Requires Photoshopped Model Photos Disclosures

Today, a new French law takes effect. It requires any commercial photo of a model whose bodily appearance has been digitally altered to be labeled “photographie retouchée,” or retouched photograph. The penalty for failure to comply is €37,500. Previously, France implemented a law requiring models' employers to obtain health certification that the models have a healthy BMI. In response to the French law, one of the world's biggest photo sites, U.S.-based Getty Images iStock , has banned (also effective today) any content "depicting models whose body shapes have been retouched to make them look thinner or larger."

All of that is meant to protect the health of models and to prevent people from unhealthy aspirations towards unrealistic beauty standards. California has introduced a similar bill last year.

The retouching law of France covers only advertising, not editorial work in magazines. The latter is much more desirable than commercial engagements as models are most frequently discovered in magazines before being recruited by brands for marketing purposes. So, the French law by itself does not directly achieve its objectives. However, it has sent ripples through the modeling industry which is now under pressure to follow the trend towards more realistic depictions of models' shapes.
The reason I occasionally write posts about photography on my legal blog is because, before I became a boring lawyer, I was a photographer. I have self-published model photo books and I represent photographers.

In photos above: French model Marie (body shape not retouched)

Friday, September 29, 2017

Chrome Will Mark All Sites with Text Forms "Not Secure" in October

Chrome now marks HTTP pages as “Not secure” if they have password or credit card fields. When Google releases its next Chrome 62 in October 2017, all HTTP sites with forms will be marked "Not secure." E.g., blogs with comments and search boxes. Also all HTTP pages visited in Incognito mode. This is an example of what it's going to look like:

The "Not secure" message will appear after user starts typing into the text field. Eventually, Google will mark all HTTP sites as "Not secure." Example:

To prevent that from happening to your website, you'd have to get a security certificate and migrate to HTTPS (the "S" at the end of that abbreviation stands for "Secure"). 

Tuesday, September 26, 2017

Amazon Wins v. Shoppers Who Didn't Notice the Conditions of Use

Last week Amazon won a court case against its shoppers who did not carefully read the Conditions of Use. The moral of this story is that, to successfully sue an eCommerce website, you have to read what almost nobody reads - the site terms and conditions of use. 

The case is Wiseley v. Amazon.com, Inc., No. 15-56799 (9th Cir. Sept. 19, 2017). Amazon shoppers got together and tried to file a class action lawsuit for deceptive business practices. Plaintiffs alleged that Amazon had falsely advertised and fraudulently misrepresented merchandise. That's because Amazon's reference prices (“was” prices, “sale” prices and crossed-out prices) were higher than prevailing market prices within the last three months. That's illegal in California. Cal. Bus. & Prof. Code § 17501 states that, “No price shall be advertised as a former price . . . unless the alleged former price was the prevailing market price . . . within three months next immediately preceding the publication of the advertisement or unless the date when the alleged former price did prevail is clearly, exactly and conspicuously stated. . . .” In other words, plaintiffs claim that they were tricked into paying higher prices than what they would have paid for same goods at a brick-and-mortar store because of Amazon's misleading listings in violation of California law. (Consumer Watchdog published a study on Amazon's deceptive pricing practices most recently in July 2017).

But plaintiffs ultimately lost because of Amazon's Conditions of Use that say: 1) shoppers cannot sue, they have to go to arbitration instead and 2) Washington law governs the sale, not California law. Private, closed door arbitration is better for Amazon than a public court where the whole country can watch. WA law is, arguably, less favorable to consumers than CA law in this case.

In most cases, website Terms of Use (a.k.a. Terms and Conditions, EULA, Conditions of Use, etc.) are a contract that is as legally binding as a signed paper contract, even if you didn't read it. That is if it is presented conspicuously enough on the site and doesn't contain any unconscionable, abusive provisions that are way out of line. In  Amazon's case, their Conditions are presented conspicuously enough at least twice: 1) when you register an account and 2) when you confirm an order.

So, that's why the proposed class action fell apart and the plaintiffs were told by the Ninth Circuit to arbitrate their claims on an individual basis. It is similar to a recent victory of Uber over its customers. Read the terms and conditions.

Sunday, September 24, 2017

Google Will Reject Symantec's SSL Certificates

Google announced that Chrome 70 (to be released on Oct. 23, 2018) will fully "remove trust in Symantec's old infrastructure and all of the certificates it has issued. This will affect any certificate chaining to Symantec roots, except for the small number issued by the independently-operated and audited subordinate CAs previously disclosed to Google." Google advises to purge digital certificates that were issued by Symantec before June 1, 2016.

That's because Google believes that Symantec's digital certificates are vulnerable to attacks due to lack of quality control by Symantec. Google said that Symantec had issued digital certificates to requesters who were not verified thoroughly enough. As a result, Google alleges that 30,000 certificates had been issued improperly, although Symantec insists that only 127 were suspicious.

Symantec held approximately 30 percent of the TLS/SSL market after the company had acquired  certificate businesses branches of VeriSign, Thawte, Equifax and others. But last month, Symantec announced its plan to sell the website security and PKI business to DigiCert for $950 million plus 30 percent in common stock equity.

What To Do?

Replace the certificates issued by Symantec before June 1, 2016, before the release of Chrome 66. That version of the browser will be released in beta on March 15, 2018.  Google has issued the following reference timeline of relevant dates for site operators: