Succeeding in Your Business: Your website terms of service need more than just passing attention

“I operate a website with training and instructional materials for people who want to engage in certain online activities.

“Lately I’ve been getting ‘cease and desist’ letters from companies saying that I am doing things on their websites that violate their terms of service.

“I’ve looked into their complaints, and it seems that while I am not doing anything to harm these companies, some of my customers may — without my permission and in violation of my instructions — be doing things on these sites that the companies have a right to complain about.

“When I mention this to the lawyers who write the letters, they say that my website terms of service does not explicitly prohibit people from engaging in improper or illegal behavior.

“I admit that when we first launched our website we ‘borrowed’ our terms of service from another similar company in Europe and assumed that it would be OK for us to use.

“I guess you’re going to yell at me for not doing a better job on this, right?”

You are 100 percent correct.

The website terms-of-service document (if you are hosting a software application on your site, this may be called a user agreement or license agreement instead) is probably the most overlooked document in the entire legal contract canon.

Too many website owners think that “since nobody reads these things anyway, it doesn’t really matter what they say, so let’s save some money on lawyers and just grab someone else’s document.”

My position when it comes to website terms of service documents is exactly the opposite: Since they are your first line of defense against potential lawsuits, lawyers need to be involved.

Yes, you are correct that your customers hardly ever read the terms of service, to the point where failing to do so has been a punch line for years on TV comedy shows like “South Park” (go to YouTube.com and search for “South Park terms and conditions” for some examples).

But you are wrong when you say that nobody reads your terms. There are, in fact, two types of people who do:

• Professionals like me who are drafting terms of service for a client and want to see what these look like for similar companies and — ahem — borrow some language if needed.

• A humorless, tough-as-nails lawyer whose client wants to sue you and is looking for loopholes in your legal protection.

You do not really care about the first person — after all, imitation is the sincerest form of flattery, and the last time I looked, there is no copyright on legal form documents — but you should care, and care deeply, about the second person.

Since no one but nasty lawyers is going to read your terms of service, why not make the document the most airtight, legalese-y, one-sided (in your favor), protective document it can be? No website owner has ever lost a customer because its terms of service were difficult to read and making them airtight will prevent at least some of these people from making your life miserable (with lawyers, there is never a guarantee).

Here are some of the things your terms of service document was missing:

• A clear disclaimer saying you are not liable for a customer’s abuse of your product or services.

• A clear warning that users are responsible for how they use your instructional materials and that improper use will lead to your terminating their account, a possible lawsuit and even criminal prosecution.

• Indemnity language by which the customer agrees to “hold you harmless” and pay your legal fees should you ever be sued by someone because of that person’s improper or illegal activities.

I would also add some language to your privacy policy saying you will share your customer’s personal information with law enforcement officials and “to attorneys in connection with any legal action against you for activities that violate or are alleged to violate these terms of service.”

More broadly, I would take a good, hard look at the services you are providing and ask yourself if you are in any way helping others violate the law or breach contracts with other people (what the criminal lawyers call aiding and abetting). If your website specifically mentions any of the companies that have contacted you, I would delete all references to those companies immediately. Even better, I would delete all references to specific companies and their websites, period.

While a federal law (called Section 230) protects website owners from lawsuits arising from things other people do on their websites or with their online products and services, that law does not protect you from things you yourself are doing on the site.

Have a good lawyer look at your instructional materials and website text. If, in fact, you are encouraging people to do illegal things or breach other people’s contracts, you could well be sued for millions of dollars under the legal doctrine of tortious interference (look it up online).

If you aren’t, then update your terms of service to make it a firewall against legal threats. Because some people do read these things.

Cliff Ennico (crennico@gmail.com) is a syndicated columnist, author and former host of the PBS television series “Money Hunt.” 

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