Websites and social media are now mission-critical for every business. Section 230 of the Communications Decency Act immunized most speech over the Internet from libel and slander liabilities. So what could go wrong?
In the author’s experience: plenty.
Further, you could be blindsided by a vendor hired to create your website or handle your social media. If that vendor disclaimed all warranties, is in a foreign country, or is not a strong business entity, if a problem arises, you may not have any recourse to the vendor. Whether insurance would then cover the potential liability would depend on the specific type of claim and your specific insurance policy.
1. Americans With Disabilities Act
There are attorneys in California and elsewhere who search for websites that do not comply with Web Content Accessibility Guidelines 2.1 (“WCAG 2.1”), which sets forth guidelines that allow visually impaired persons to use a screen reader to access a website’s content. California has the Unruh Civil Rights Act, which allows for recovery of statutory damages of a minimum of $4,000, plus attorneys’ fees. Violations of the federal Americans with Disabilities Act (“ADA”) are considered to be violations of the California Unruh Civil Rights Act. Thus, California attorneys are demanding that companies pay thousands of dollars to settle ADA claims threatened by their visually impaired clients for failure to provide reasonable accommodations on websites that do not comply with WCAG 2.1. Attorneys in other jurisdictions assert similar claims based on civil rights laws in those other jurisdictions, sometimes seeking class action status to represent all visually impaired persons in those other jurisdictions.
2. Unlicensed Content
A website contains content that is subject to protection by intellectual property laws, including copyright, trademark, trade secret, and right of publicity laws. If your website contains (a) photos, videos, text, or music that have not been properly licensed from the copyright owner and had proper releases obtained from the persons or properties depicted; (b) displays a third party’s trademark in a manner that creates confusion as to whether that third party approved your website; or (c) discloses someone else’s confidential information, you may be faced with a claim for violation of intellectual property rights. Thus, you must be sure that you maintain adequate control of the content shown on your website – do not allow a summer intern to copy a photo from the Internet and post it on your website.
Photographers can use search engines to find copies of their photographs being used without permission on websites. Motion picture studios monitor torrent files and can subpoena internet service providers to find who has been downloading movies. Search engines can find other unlicensed content on your website. If your website contains unlicensed content for which a copyright registration was already issued, then the copyright owner is entitled to recover attorneys’ fees, and “statutory damages” of up to $30,000 ($150,000 for a willful infringement). If a vendor provides content for your website, you must be certain that the vendor will defend you if that content results in a claim for copyright infringement, trademark infringement, violation of the right of publicity, or other claims.
3. Privacy
If your website collects information from visitors who are under 13 years old, you must comply with the federal Children’s Online Privacy Protection Act. The Federal Trade Commission has published proposed regulations relating to commercial surveillance and data security. If your website collects protected health information, then you may be subject to the federal Health Insurance Portability and Accountability Act. Websites that allow credit card transactions should also comply with the Payment Card Industry Data Security Standard.
Several States (California, Colorado, Connecticut, Utah, and Virginia) have adopted laws governing the privacy of personal data. On August 24, 2022, the California Attorney General announced a settlement with Sephora for $1.2 million for violating California’s privacy law. The European Union also has adopted the General Data Protection Regulation, with fines of up to 4% of annual revenue or €20 million, whichever is greater. If your website serves a substantial number of persons from these jurisdictions, then you may become subject to these privacy laws.
4. Domain Names
If you choose a domain name for your website that is confusingly similar to someone else’s trademark, then they may file a lawsuit or commence a domain name arbitration against you, to take away that domain name.
5. Search Engine Optimization
If metatags and other metadata placed on your website to increase search rankings contain competitors’ trademarks, you may face a claim for trademark infringement. You may not know whether this has been done if you hired a contractor or consultant to increase your search engine rankings, because metatags and metadata, by definition, are not visible when viewing a website.
6. Reviews and Influencers
The Federal Trade Commission has published guidance documents for platforms and marketers. If your website allows reviews, those reviews must identify incentives and material connections between sellers and reviewers (disclose whether a reviewer or influencer received the reviewed item for free, for example); treat positive and negative reviews equally; and have effective reporting mechanisms for consumers and businesses to use.
7. Patent Infringement
Patents have been issued for various technical aspects of how Internet web pages operate. Amazon’s one click shopping was once patented (the patent was later invalidated after very expensive litigation). A claim may be asserted that your website infringes on one of these Internet web page patents. If such a claim is made, it must be evaluated very carefully by a registered patent attorney. Relying on Internet statements that someone is a “patent troll” is NOT a substitute for a careful evaluation. With rare exceptions, only a registered patent attorney would be able to properly evaluate a claim of patent infringement and advise of the available options for addressing it.
8. Hacking and Cybersecurity
The software used to create your website could create a vulnerability for hacking. One of the most important hacks ever of websites was the “Panama Papers,” in which a law firm’s website was hacked, and financial information of the rich and famous using tax havens was extracted and published, leading to worldwide repercussions. Several reports indicate that the hacker gained access through the Revolution Slider plug-in for WordPress, a content management system that creates web pages, used on many websites. Your website is an attack surface that can be exploited by hackers to gain access to all your other systems.
9. Content Issues
If you have customers in other countries, your website may violate laws in those other countries that govern content. The First Amendment only applies to the United States. Providing information or offering goods or services in other countries through your website or social media may subject you to the laws of those other countries. For example, France requires that all offers, terms of service, invoices, receipts, and other documents relating to trade be in French. All websites and social media pages of organizations carrying out commercial activities in Quebec must be in both French and English. The display or sale of items bearing symbols of the Nazi party is banned by the laws of several countries around the world. Depictions of the Prophet Muhammad may be very offensive or illegal in certain Muslim countries. Laws of various countries also forbid criticism of the government or of various persons.
10. Webmaster or Social Media Contact Leaves
Having an employee or independent contractor create a website or serve as your social media contact can create major problems if the webmaster or social media contact leaves. The webmaster may have registered the domain name in his own personal name and refuse to surrender it. If the webmaster created the website as an independent contractor, he or she owns the copyright rights to the website, unless the copyright rights were transferred to you in writing. The webmaster may keep all the data that came through your website. The webmaster may charge a substantial amount of money for translating your data from a proprietary format used on your website to an industry-standard or open format that a new webmaster can use. The webmaster could decide to sabotage your website if terminated. The social media contact may have registered your organization’s name on social media websites under his or her personal name, and take all the followers with them when he or she leaves. Many other problems could arise. You must be sure that you can continue to use your website without interruption, even if your webmaster is terminated, and that you will not be damaged if your social media contact leaves.
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The author hopes that this top 10 list serves as a warning that helps your organization avoid being victimized.
