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Spelling It Out Online: Terms of Use and Privacy Policies By Ian A. Rambarran, Shareholder Websites offer the ability to reach many people for informational and commercial purposes. However, they can also expose companies to significant risk in a multitude of jurisdictions. That risk can be limited by posting a Terms of Use and Privacy Policy on the company's website as they help with:
The Terms of Use and Privacy Policy, in essence, are contracts between you and your customer. They are typically shown as hyperlinks. A person clicking on that link is then taken to another part of the website where the specific terms are contained. This makes the "notice" of the initial hyperlink very important. Several lawsuits regarding what constitutes proper notice have arisen in recent years. From these cases, we have found that courts usually require posting the hyperlink in (1) a different color from the website's background; (2) a readily visible location; and (3) a larger font than other text. In other words, if you cannot easily see the policy, it will not be enforced. One of the other important components of the Terms of Use and Privacy Policy are the terms and definitions themselves. This means that your company must ensure that the policies have clear and easy to read legal terms that allow the website visitor to understand what it is he or she may be obligated to do. A correctly worded policy may be used to limit where a lawsuit is filed, whether arbitration must be used, and what remedies are permitted. We have seen provisions such as the ones just mentioned, enforced in circumstances where the competitors have improperly taken the content from a website to use for the competitor's website and when parties try to use the court process rather than arbitration. In sum, to protect the way your business conducts business on the Internet, you must make sure the Terms of Use and Privacy policies are noticeable and understandable. Otherwise, you may find yourself hauled off into unfamiliar territory across the country.
Ian A. Rambarran is a Shareholder in the Sacramento office of Klinedinst PC. Named a Rising Star® in the 2009 edition of Northern California Super Lawyers®, Mr. Rambarran is no stranger to the evolving world of technology. He frequently advises clients on intellectual property issues including counterfeit, internet defamation, and trademark and copyright infringement. Mr. Rambarran's work has been cited by the United Nations, federal courts, and other law reviews in the area of e-commerce. He is very active within the Sacramento County Bar Association, and has been featured in the Sacramento Lawyer magazine.To learn more about Mr. Rambarran, please click here.
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Ian A. Rambarran, Esq.
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