Lessons I Learned Today 5/29/09 One Lawyer’s Guide to the Tortoise vs. Hare Race

This is a digest and recap of highlights, quotes, and comments from articles and discussions posted on this date on the Applied Entrepreneurship, LinkedIn group site.


*Brand Protection Online: 11 graphic examples of brand abuse online

The threat of aggregate brand abuse can fuel a tipping point of how your brand is perceived, affecting the brand’s reputation, and thus, equity, worth, or value. Addressing threats to your brand on the internet is a primary business concern and the consequences of multiple brand abuse issues online can loom much larger than singular incidents of unauthorized sales, counterfeiting, cybersquatting, trademark dilution, or a gripe site making unpleasant claims.

This article is particularly useful because it presents nice examples of the primary forms of online brand abuse. Some of these are:

  • Brand Erosion (trademark infringement, copyright violations, defamatory claims, and competitors advertising on trademarks) Brand Erosion is a slow but deadly brand killer. It is easy for disgruntled customers, clients, employees, or deceptive competitors to publish negative experiences or content about your company’s products and services.
  • Cybersquatting is the registering, trafficking in, or using a domain name with bad-faith intent to profit from the goodwill of a trademark belonging to another entity.
  • Typosquatting (a form of Cybersquatting that utilizes various typographical errors within the name of a trademark)
  • Brand Siphoning – On the surface it makes sense for direct selling and network marketing brands to utilize affiliates and web-savvy reps to generate revenues in the search engines for branded searches.
  • Traffic Diversion occurs when any third party places ads for your trademarks (company name, products, etc.) on the search engines. These ads dilute your brand and divert traffic away from your web assets.
  • Phishing – Generally speaking, phishing is primarily a threat to financial services companies. Phishing ploys are not only targeted at consumers, but to employees as well, designed to extract account information, passwords, and even trade secrets.
  • Unauthorized Sales – Gray market and unauthorized sales channels can compromise the integrity of a brand and can create rancor amongst authorized vendors and reps who follow corporate guidelines and pricing structures.
  • False Associations can be conveyed using trademarked domains (cybersquatting) as well as text or logos that suggest or imply some type of business relationship.


*A Theory of Trademarks in the Blog Era by Ron Coleman

The IP implications of blogs beyond trademarks, especially regarding copyright but even recently involving the publication of trade secrets, are also wide-ranging.

Unlike virtually no other mass publication of trademarks that is likely to interest mark owners, the Internet raises few barriers to entry. Blogging presents even fewer – virtually none. Trademark enforcement practitioners who are used to the frustration of chasing after ethereal Internet-based trademark infringers are understandably aghast over the incredible ease, and functional anonymity, with which bloggers can instantaneously upload text, graphics and files, including HTML links. Blogger software platforms, including substantial hosting resources, are available for free from services such as Blogger and many others.

There is virtually no editorial, legal or other oversight over what content is to be found on blogs, as is the case on most privately-hosted websites, but while most recreational blogs are graphic nightmares, even the simplest blogs present a structure that features easy interactivity, a choice of practical and attractive graphic designs, and numerous add-on features that enable even lightly experienced amateurs – for no or very little cost – to easily monitor the volume, origin and trends of reader traffic, feature cooperative or trade advertising (and for higher-traffic blogs, even paid advertising), and take advantage of the burgeoning phenomenon of online blog networking.

Communication on the Internet, typified by blogs, is highly symbolic, and trademarks, if they are any good at all, pack a powerful semiotic punch. This attraction is intensified by the countercultural, or at least individualistic, tone affected – and frequently realized – widely throughout the blog subculture.

Blogs are democratic, self-obsessed, essentially unaccountable, cheap, technologically powerful, judgment proof, ungoverned, interconnected, and very, very public – meaning that intellectual property lawyers, or those who play them on the Internet, should proceed with care.


*Forming and Operating a Small Business– ABA Family Legal Guide

A little planning now might save plenty of time, money, and heartache down the line.

This article deals with the legal and other issues that have to be resolved when forming and operating a small business. Whether you’re manufacturing lawn furniture, selling stuffed animals, or offering high-tech computer consulting, you’ll have to face certain basic issues, all of which have legal dimensions.


*So your Business has a Legal Problem. . . 8 Useful Tips on what to Expect from your Lawyer by Igor Ellyn

This article provides a very nice and details series of tips on everything from finding and hiring a lawyer, fee structures, and settlements, to how to be a good client and avoid legal problems in the first place. Definitely worth reading for any entrepreneur.

As a business owner, you are usually run off your feet with the challenges of operating your business. The last thing you need to worry about is a legal problem. Many business people put off dealing with a legal problem because they don’t know where to turn, don’t have the time, or most often, are afraid of how much it will cost and how much time it will take. The authors give tips on how to get legal advice efficiently.

Every business should have a team of on-call lawyers. This is less expensive or complicated than it sounds. All you need are the telephone numbers and email addresses of trusted corporate, employment law and litigation lawyers. Depending on the nature of your business, you may also need an intellectual property lawyer, who deals with trademarks, patents and copyright. You may even need a tax lawyer because not all tax issues can be solved by an accountant.

When you retain a lawyer, you need a trustworthy advisor, who will point out the weaknesses of your case as well as the strengths. A litigation lawyer who is waiting by the phone for your call and tells you exactly what you are hoping to hear may be too hungry or too inexperienced to manage your case. He may be in over his head and will bail out as soon as your case takes a negative turn. By then, your legal situation may have worsened. It will be more expensive and perhaps impossible to repair it.

Competent legal advice is available for matters such as corporate organization, leases, the wording contracts and other documents you use in your business, partnership and shareholder agreements, your relationships with your employees, your company’s trade names, logos and website, your regulatory compliance, your risk management and litigation prevention techniques. It’s all important to arrange legal affairs to ensure that your personal liability is limited in the case of a claim against your business.

Ensure that the legal issues affecting your business are in good order. This is likely to save you a lot of money and grief in the future. You might even consider having a legal audit or a “business legal checkup”. We plan to write about this topic in a future article in this newsletter. Preventative legal advice may be expensive but it is just as important as fire insurance.


*To Avoid Tax, Set Up as S-Corp or C-Corp? by Karen E. Klein

“The debate on proposed tax rate increases for the country’s wealthiest people has just begun, and the potential increases would not happen until 2011. Still, tax experts say it is not too early for small business owners to think about defensive strategies. Whether they’re contemplating moving from S-corporation to C-corporation status, accelerating income, or deferring compensation, their decisions should be thought through in the larger context of their business and personal goals.”

” Small business owners who think they might be affected really need to see their tax advisers and look at their long-term desires, not just for their businesses but also for their personal needs. They need to run the numbers; this should not be a gut reaction.”


*A Guide to Self-Employment

Besides paying taxes, finding health care, and landing clients, self-employed workers face another big challenge: motivation. It’s easy to procrastinate when there’s no boss looking over your shoulder.

One of the most important referrals you can get is for a good accountant. Knowing what to write off as business expenses can save enough on your tax bill to make hiring an accountant worth it,


What I Think

I think, after probably scaring you half to death yesterday, with a score of articles about a wide variety of potential legal entanglements, the articles posted on this date may calm you back down, a little.

Sorry about yesterday, if you still have the shakes. Unlike my usual custom of pretty much choosing the most interesting articles at random, I made some attempt in choosing the articles I posted on this date, to make amends for the horror show yesterday. The “amends” I’m referring to are those articles which demonstrate there can be light both at the beginning of the tunnel and at the end, in terms of what legal counsel can do for you. Not only do some of these articles tell you how to get out of your legal jam, some actually should help you avoid one in the first place.

This, of course, is good for you as a bottom line oriented entrepreneur, and bad for me, as a lawyer who makes much more fixing problems than helping clients avoid them. Oh well, it is great to see such a high percentage of my clients surviving the inevitable potholes on the road to success. My theory, is that a good counselor, legal or otherwise, will eventually see greater professional success, as well as personal satisfaction, helping clients avoid disasters for relatively lower retainers, than letting the chip fall where they may, hoping some of them will come back seeking disaster repair advice at relatively higher hourly rates. Stay tuned for the results.

Sure, I couldn’t help starting out with 11 graphic examples of brand abuse online, but the graphic depiction of the various forms of online abuse should help educate some as to what to actually look for. The Trademarks in the Blog Era article, by Ron Coleman, points out many of the problems the law has in keeping up with emerging technology. The other articles posted on this date provide a range of advice on topics, such as comparing an “S” corporation start-up to an LLC, self-employment issues, and a whole host of other topics, which should pretty well cover the spectrum for a small start-up business. Just as the horrors from yesterday’s articles wait in the bushes to jump you when least expected, obtaining sound legal and accounting advice is pretty easy and the sources plentiful.

Historically, it has seemed that cyber criminals, identity theives and their ilk always managed to stay one or two steps ahead of the law. I continue to be amazed, however, every time I research a legal or business issue, how many more narrowly focused blogs there are on topics of interest in my search, then there were the last time I looked.

With the explosion of such blogs and informational Web sites, this may be the first time the sources of advice have exceeded the number of individuals committing the crimes. Use these resources wisely and often to avoid becoming one of the statistics.


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If you enjoyed my impression of these articles, why don’t you read them for yourself and see what you and I missed or hit? Join the Applied Entrepreneurship group on LinkedIn. Membership is free and I try to post about ten articles a day there. We have some great discussions going and if you are an entrepreneur, we hope you will join us.

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Posted in Applied Entrepreneurship, Business interruption, crisis, etc., Business life cycle, Buying a business, Family business issues, Financial security, Financing a business, Growing a business, Innovation, Intellectual property, Law, Perseverance, Personal happiness, Planning for a business, Recession strategies, Running a business, Selling a business, Starting a business, Succession Planning, Thinking about a new business, Women Business Enterprise
2 comments on “Lessons I Learned Today 5/29/09 One Lawyer’s Guide to the Tortoise vs. Hare Race
  1. Igor Ellyn says:

    Your blog referred to an article called “So your Business has a Legal Problem. . . 8 Useful Tips on what to Expect from your Lawyer”. You excerpted the first two paragraphs. Readers can find the rest of the article at the following link: http://www.ellynlaw.com/info_centre.htm.

    The same link, http://www.ellynlaw.com/info_centre.htm, also refers our article: “The Business Legal Checkup: Preventive advice for the legal health of your Business” and other articles of interest available for download.

    Business people involved in disagreement with their partners may be interested in “Shareholders Remedies in Canada”, which may be found at http://www.hg.org/article.asp?id=4818.

    Igor Ellyn, QC, CS
    Ellyn Law LLP
    Canadian Business Litigation and Arbitration Lawyers
    Toronto, Ontario, Canada

    • bizlawblog says:

      Thank you for your comments.

      All of the articles found in the excerpts or digest can be found with a direct link and attribution where I have posted them originally, which is on the Applied Entrepreneurship LinkedIn group site. The links at the beginning and end of each post will take you directly to the registration screen of LinkedIn, where one can register for free and and join the group to see these posted articles on various aspects of entrepreneurship at the rate of about ten a day during the week, with a few sprinkled out on weekends and holidays. I try to post this commentary on them, via this blog, a few weeks in arrears to give a second taste.

      Ellyn Law, LLP, a law firm in downtown Toronto, Ontario, Canada, has a number of nice articles on their site.

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