As we head into the end of the year, it is always a smart move to step away from the holiday partying and do a run through on the status of your website. I’ve put together the following to give you a general checklist of items to consider in doing so.
Disclaimer
This should be common sense, but I feel compelled to mention it as people can be a bit dense at times. The following checklist is very general in nature. There is no guarantee it will match everything you need to look at on your site. A dating site has different needs than a forum which has different needs than an e-commerce site. Having said this, let’s get to it.
Business Entity
If your business is run through an entity, make sure the documentation regarding the entity is up to date. A few issues to keep in mind:
- Have you held an annual meeting?
- Did you elect officers and, if appropriate, board members for the company for the coming year?
- Have you created minutes for the annual meeting, approved them and placed them in the corporate book?
- Did any of the owners of the company marry during the year? If so, what are the ramifications for ownership? Some states bequeath rights to the new spouse.
- Have you filed all necessary state forms? Most states require a statement of officers be filed once a year.
- If your business moved to a new address, did you update the documentation with the state and IRS?
Site Legal Documents
A website should have terms of use and a privacy policy at a minimum. Depending on the nature of your site, you may also need disclaimers, DMCA policies, earnings disclosures, affiliate compensation notice and business opportunity disclosures as well. The FTC and courts have been developing new regulations and laws in this area in 2012, so make sure you are up to date or risk running into legal trouble. Remember, FTC fines start at $16,000 per incident, and court cases result in large attorney’s fees if nothing else. Regardless, ask yourself the following.
- Have you changed anything regarding how individuals can use the website during the past year?
- Have you added any new features or modules to the site requiring mention in the terms? For instance, adding a forum would require you to get into compliance with the DMCA.
- Have you started charging for something new in the past 12 months?
- Have you changed prices on any products, memberships or services offered on the site?
- Did you do a review of a product on your site for which you receive a commission? Did you provide an affiliate earnings disclosure for readers?
Documentation
Documentation for new creations can be a real problem area for many online businesses. It is vital you obtain all the legal rights to any new content while also defining the legal rights for any end user of the new content or products created.
Have you created videos for marketing on YouTube? Did you get model release agreements from anyone in the videos?
Did you hire anyone to write articles or other content for you? Did you obtain a written copyright transfer from them?
Have you created any e-books? Do they have the necessary language disclaiming liability?
And then we have older content on the site. I suggest you run through each page of your site and look at any images, video or audio. What rights are associated with each piece of content? If you cannot identify where you were given the right to use the content, take it down and replace it with something else. Otherwise, you could face a copyright infringement complaint.
DMCA
If you allow visitors to post on your site, are you in compliance with the Digital Millennium Copyright Act of 1998? This Act provides you with immunity from monetary lawsuits if you comply with the procedures detailed within it.
If you are in compliance, have you designated a DMCA agent for your site? Just as important, is the contact information for the DMCA agent up to date with the Copyright Office? More than a few sites have been attacked in this area.
COPPA
If your site is directed at kids under the age of 13 or might be indirectly used by them, including any apps you’ve created, are you in compliance with the Children’s Online Protect Act of 1998? More importantly, are you watching for the new regulations regarding the Act to be issued either this December or in early 2013? The changes are expected to be significant, so stay on top of this subject.
Tax Planning
Taxes are boring and painful. Tax planning will be boring, but it will greatly reduce the pain associated with how much you have to pay at the end of the year. Using a CPA for your tax planning is incredibly important. They can save you a boatload of money by positing the company finances to maximize what you take home and minimize what you pay the government. A CPA, however, is only effective if you meet with them before the end of the business fiscal year, which is usually December 31 for most businesses. Have you met with your CPA or do you just enjoy paying the government more than you should?
This represents a relatively short checklist applicable to most sites. Still, getting your house into order on just these subjects will give you a good legal and financial foundation moving into 2013. Feel free to contact me if you need assistance with any of the above items.
Richard A. Chapo, Esq.
