Web design and the Law

by Timothy J. Walton

People who design sites for the World Wide Web need to be aware that they are legally responsible for the content of that site. The Internet may seem like a lawless frontier, but cyberspace is still governed by laws designed for use in the real world. In addition, the tremendous growth of the Internet and the activities of schemers and hucksters have caught the eyes of elected officials, so there are new laws that apply specifically to the Internet. This page will give a brief overview of areas of the la w that Web designers need to understand. State of the Art Jurisdiction Those who confidently scoff at laws passed in another state should heed the disturbing trend of courts exercising jurisdiction across state lines. This was seen first in a Tennessee court which ruled against a California couple that had never before ente red Tennessee. The couple had interacted with Tennessee citizens by operating a Bulletin Board Service in California. Tennessee citizens downloaded pornographic materials from the California BBS. More recently judges in Minnesota, Ohio and Arizona have exercised jurisdiction over businesses located outside their state. This means that a Webmaster or hosting service may be held responsible for the laws of other states. For example the Minnesota ca se involved a Nevada company whose Website featured the opportunity to gamble. What is perfectly legal in Nevada was accessed by citizens of Minnesota, where gambling is prohibited by law. Most recently, a California appellate court found jurisdiction over a dispute involving a contract formed by email and telephone contacts. The decision significantly extends California law because people using email, unlike telephone users, may not be aw are of which jurisdiction the message is going to or coming from. I Was Framed The California Legislature has also passed a set of laws aimed specifically at Web merchants. Anyone selling to (or attempting to sell to) a California citizen through the Web must comply with specific laws intended to reduce the incidence of fraud. Onli ne merchants must adhere to all the same statutes that a merchant in the real world must follow. But online merchants also must comply with the additional requirements. The first is that before any product can be sold, the vendor must state the legal name of the business, the full text of the vendor's return and refund policy and the street address where they conduct business. A post office box may be used if certain other requirements are met. This can be done either on the Website or via email. If this disclosure is done on the Webpage, then it must be in one of four places: 1. 2. 3. 4. The first screen displayed when the site is accessed; The screen where the goods are first offered; The screen where an order is placed for the goods; or The screen where the buyer enters payment.

The required information cannot be smaller or less legible than the offer of goods or services. The merchant must also state a method for the buyer to receive this information by email. The email disclosure must be made within five days of request. If you write pages for companies that advertise a toll free phone number on the Web, you should talk with an attorney in your area about the requirements. Laws regulating telemarketing may also cover Web merchants, depending on the state. In California, failure to comply could subject the vendor to a misdemeanor conviction and either six months in jail or a fine up to $1000. Exceptions to the Rule Attorneys Attorneys with Websites must adhere to more rules than other people. Each state has its own Rules of Ethical Conduct that govern behavior. If you are doing Web work for lawyers, you should check your local law library for the rules about advertising legal services. Attorneys in Florida and Texas must submit sites to the State Bar for review prior to publishing on the Web. Many states require that ads have specific disclaimers or labels. (You have seen those ads that say "solicitation" or "advertisement." ) So far, no State has specifically required such labeling of web pages, but technically, Websites apply. You would not want your page to be the first to get hit with disciplinary action. Securities Sales Spring Street Brewery made headlines and history by selling stock over the Web. With a knowledgeable attorney representing them and prior approval from the SEC, they had great success. The interest in this type of marketing has prompted the SEC to promulg ate a new set of guidelines for those seeking to sell or promote securities over the Internet. Since securities regulations are a detailed and complex area of the law, it is crucial to consult an attorney before selling stock, bonds, notes, investment con tracts or businesses. Taxes Governor Pataki of New York took one of the first steps in encouraging commerce over the Internet. He exempted out-of-state companies from paying sales tax on web advertising. Unlike New York, California is considering taxing Internet services. In particu lar, the State Board of Equalization would like to tax services and information transferred over a modem. The Clinton administration announced last fall that it will not seek new taxes on Internet transactions. For now, it seems that the prudent company n eed only pay sales tax in its home state, as it would when selling items through a mail order catalog. Heating Your Own Boilerplate It has been said that ownership is like a bundle of sticks, where each stick represents a right of ownership. The "right to be paid" is one stick. Most sites don't ask for payment in exchange for

info, demonstrations or product download. But there are oth er rights that the owner may wish to protect. Software companies often place a page of legal mumbo-jumbo that is "required" reading before downloading a copy of a product. The "shrink-wrap licensing" of a product, whether for sale or for free, has become increasingly important. This is definitely not something you should attempt to write without qualified legal assistance. Merely copying the language of someone else's shrink-wrap license is particularly dangerous and should not be considered adequate. Can I Use It? Copyright is another right of ownership. Some people believe that if an image appears on the WWW without a copyright notice, that means it has entered the public domain. Nothing could be further from the truth. The law says that when an idea is expressed in "fixed and tangible form," then the idea is copyrighted, whether there is an explicit copyright notice or not. In a case named MAI v. Peak, a court even ruled that placing code in RAM can violate copyright! Images on the Web come with an implied license to download into RAM and your browser's cache, but duplicating beyond that may be infringement. There are very few acceptable "fair use" exceptions to this rule, and the exceptions are narrow. One should see k the advice of legal counsel before "borrowing" images or code without permission. Whose Line Is It Anyway? Although individual states have their own laws regarding copyright, federal copyright statutes generally supersede them. International law influences federal law, but does not dictate it. For instance, Europe protects copyright aspects that America does n ot, such as the right to prevent alteration of finished artistic work after it has been sold. US copyright law protects Webmasters. Unless there is an agreement to the contrary, the creator of a site owns the copyright. This means that businesses that hire an independent contractor to create a Website must continue to hire the individual contracto r for all alterations. Businesses that intend to hire a different contractor to handle site maintenance (or who plan to do it inhouse) may require you to surrender your copyright by express agreement, oral or written. Placing a copyright symbol at the bo ttom of a page with the date and legal name will not always provide the specified individual with the rights, but it does indicate an intention to do so. The US Supreme Court The US Supreme Court has decided the fate of the Communications Decency Act, or "CDA" as it is known, by overturning certain sections. The Court left intact, however, the portions dealing with "obscene" content and content providers should take steps to a void viewing/use of such material by minors. One way to do this is to have a warning page, where surfers must click on a statement certifying that they are over the age of 18 and will not hold the site responsible for violation of community standards. No court has yet decided whether this type of warning is sufficient. Sites that wish to avoid the risk inherent in such minimal prevention can make use of the cottage industry that has sprung up to verify a user's age, such as AdultCheck and AdultVerify. Oth er methods include listing a site with Surfwatch or Cyber Patrol or including

warning labels. The W3C has warnings that can be created and attached using the new Internet Content Selection (http://www.w3.org) Scams, Schemes and Scares The Federal Trade Commission is looking into claims that more than 500 Web-hosting pyramid and ponzi schemes were in operation in 1996. These "get-rich-quick opportunities" are the same online as they have always been: someone promising that you can make money by making the same promise to someone else. For example, if an ISP offers you free Webspace in exchange for signing up clients, be very cautious. This can be a legitimate promotional tool, but it can also be abused. Be certain that the ISP can fulfi ll all the promises it makes, and avoid the company completely if the plan sounds "fishy." From Indiana to the Internet, if something sounds too good to be true, it usually is. Keeping Up Web design is becoming more and more regulated and therefore perilous. As always, "ignorance is no excuse." Knowledge and understanding of the law are basic requirements for selling services in any forum, and HTML scriptors are no exception. If you have q uestions about the legality or propriety of your content, it is wise to check with an attorney who is familiar with the Internet and the unique new issues it has created. Disclaimer 1998 Timothy J. Walton All Rights Reserved