Website Legalities and the Consequences of Non-Compliance

By Lisa Allen, Esq.
May 2016

Legal compliance when operating a business is hard work. Many people focus on the standard questions: “Am I adhering to the corporate formalities?” “Is my employment agreement valid?” “Am I complying with the applicable tax law?”

What most business operators fail to consider is the legalities surrounding the operation of a business website. Indeed, many have no idea that there are laws that govern the use of a website for business purposes. Below is a list of certain website legalities and the consequences for failure to comply:

1) Privacy Policy

The California Online Privacy Protection Act of 2003 (OPPA), found in Business and Professions Code sections 22575-22579 requires “any commercial websites or online services that collect personal information on California residents through a website to conspicuously post a privacy policy on the site.” Although not all states require such a privacy policy, it is important to note that if a California resident uses the site run in another state, the site owners can still be found liable for failure to comply with OPPA. As such, it is important, whether or not your state mandates it, for your website to contain an adequate privacy policy.

Generally, a privacy policy should include: 1) the categories of ‘personally identifiable information’ the website collects and the categories of third-parties with whom the information might be shared; 2) a description of any process that allows the consumer to change its ‘personally identifiable information’ collected by the website; 3) the process by which the a website informs the consumer of material changes to its privacy policy; 4) the effective date of the privacy policy; 5) how the website responds to Web browser ‘do not track’ signals; and

6) a disclosure relating to whether other parties may collect ‘personally identifiable information’ about the consumer’s online activities over time and across different websites when a consumer uses the operator’s website.

In California, if your website fails to comply with OPPA requirements, you may be subject to lawsuits brought under California’s unfair competition law, either by government officials or private citizens, and seeking both civil penalties and equitable relief.

2) Terms of Use

Think of a ‘terms of use’ (“TOU”) statement as a contract between you and your site’s end users. A TOU statement specifies how your website’s visitors can and cannot use your website. Commonly, a TOU includes rules relating to use of the site, choice of law and forum selection provisions, rules relating to the posting of information on the website by users, and disclaimers of liability.

While not legally mandated, a TOU is an important tool for a business in that it protects the website owner from use violations by its users. Another important reason to have a TOU is to limit the website owner’s liability for any errors or omissions contained on the site.

3) Copyright Notices

A copyright notice should appear on at least all of the main pages of the site. The notice should begin with either the full word “Copyright” or the symbol ©, not both. The copyright year displayed will be the range of years beginning with the first year you launched your website and ending with the current year. Following the complete corporate name, the notice should contain the statement “All rights reserved.”

For example: “Copyright 2011-2016 XYZ, Inc., All Rights Reserved.” or “©XYZ, Inc. All Rights Reserved.”

As with TOU’s, there is no legal requirement mandating that websites contain copyright notice.

However, as stated in an article by Plagiarism Today (Why Bother With a Copyright Notice, published June 27, 2012), there are three key benefits a copyright notice provides: 1) Though most countries do not require a notice, having a notice may provide some protection in those that do; 2) It prevents confusion on the nature of the work and keeps others from thinking it is not copyrighted; and 3) It eliminates innocent infringer claims, maximizing the amount of damages that you can win should you decide to sue.

4) Americans With Disabilities Act (ADA)

Title III of the ADA prevents discrimination against the disabled in places of public accommodation: “No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to) or operates a place of public accommodation.” 42 U.S.C. § 12182(a).

This law, enacted in 1990, does not specifically address website accessibility for the disabled.

However, recent case law has seemingly expanded the ADA to websites and is therefore something to consider in maintaining a website used by the public. In 2007, the National Federation of the Blind sued Target in a class action lawsuit. There Plaintiffs sought declaratory, injunctive, and monetary relief on the grounds that Target’s website was inaccessible to the blind in violation of the ADA. The Court agreed, finding “that to the extent that plaintiffs allege that the inaccessibility of Target.com impedes the full and equal enjoyment of goods and services offered in Target stores, the plaintiffs state a claim [under Title III of the ADA].”1

Anyone familiar with the ADA knows that costs of non-compliance can be steep. In a civil action, a court is authorized to grant injunctive relief as well as monetary sanctions for failure to comply. These penalties can be as much as $75,000 for the first violation and $150,000 for any subsequent violation. The problem most businesses will face when trying to determine if its website meets ADA requirements is that it is difficult to tell whether a website is ADA compliant simply by looking at the page. This is because most changes occur behind the scenes through the use of embedded code. If you are worried that your website might not comply with the ADA, a great resource for you or your web designer is the Web Content Accessibility Guidelines, which can be found at https://www.w3.org/TR/WCAG20/.

 


1  See United States District Court, Northern District of California, MEMORANDUM & ORDER, Re: Defendant’s Motion to Dismiss; Plaintiffs’ Motion for Preliminary Injunction; p. 11 at http://writ.news.findlaw.com/ramasastry/nfbvtarget90606ord.pdf.

 


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Posted in Copyright, Data Privacy, Privacy Policy, Terms of Use, Website Compliance and tagged , , , , .

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