Making It Legal:

Do-it-yourself legal sites drive me crazy.  I came across a DIY legal site called Negonation this week – yeah, OK, it’s in Brazil, but the principle is the same.  It touts a “get-your-contract-off-this-site-and-avoid-legal-feesâ€? service.  It claims that “its contracts are legally enforceable in the offline world, even if the parties are in different countries.â€?  That’s quite a bold claim.

Online sites don’t necessarily empower the lawyer in all of us.  What they do is delude many people into thinking that they have an “inner lawyer�.  Not everyone does, and that’s okay.  I don’t have an “inner doctor� –- if I have a medical need (even a regular check-up), I get help.  I don’t have an “inner accountant� – I make sure that I have one on call who can provide guidance as to how I should handle my financial statements and taxes.  I am who I am:  anal, cautious, and detail-oriented (among other things).  That makes me perfectly suited to being a lawyer.  I am not cut out for many other professions, and that suits me just fine.  I’ll leave those areas of specialty to the experts.

What’s dangerous about these sites is the false sense of security that entrepreneurs get from taking legal agreements from the Internet, without having the background or training to fairly evaluate whether what’s in the agreement is in their best interests, or whether there are other things that should be in the agreement that aren’t.  There’s no one affiliated with the sites who will give you the legal advice about your specific situation –- they’re just selling you a product (the agreement).  Take it or leave it.  They don’t take your own needs into account when creating the agreement –- it’s an off-the-shelf product. 

It would be like walking into Bloomingdales and buying a suit without looking at the size.  You know you need a one, but if it doesn’t fit properly, you could end up spending more for alterations than you paid for the suit.  Getting the right legal protections in place for your company isn’t just a matter of one-size-fits-all merchandise. 

Lawyers provide a hybrid:  product and service.  And it’s the service you receive that ensures that the product truly meets your needs.  For more guidance, see my article “What You Should Know Before Copying Contracts from the Internet.� 

Few aspects of marketing are as crucial to a company’s identity than its website.  And fewer marketing vehicles can become as much of a money pit and time suck as . . . a website.  It’s a never-ending process of evolution, a frustrating “work in progress.�  Just when you think you have it figured out, your customer base changes, or your pitch changes, or your business model changes – something always changes.  And heaven forbid your site stay static!   

Websites can be a trap for the unwary . . . but you can easily acquaint yourself with the right questions to ask.  Learn from some of the aggravation that others have endured.  Business Week’s article, “Web Design Horrors: Be sure you get the site you bargained for,� points out several of the key issues such as (1) who registers (owns) the domain name? (2) what details should you spell out? and (3) where does the human being who’s building the site actually work?  Plus, you get the “gossip� from readers who have commented on their own tales of woe.

I, too, ran into web design problems in developing my Wise Counsel Press site, which you can read about in my article, “Playing Ostrich is for the Birds.�  By the time you look at those two sources, you’ll have a solid idea of the kinds of discussions you should have with a web designer well before you plunk down that hard-earned deposit money!

I don’t advocate that entrepreneurs treat their legal work as a DIY project.  And neither does California attorney Nina Yablok.  But in her post, “How to Write a Contract,� she gives some great pointers in how to get the ball rolling so that your attorney has less rewriting to do (which can then save you money).

And who am I to argue with a namesake?  J 

I had a query about using confidentiality agreements.  “Cee� asked: 

<<i have every person i deal with sign confidentiality. but i have found that it does not really protect you because unless you are willing to pour tons of money into a lawsuit, and most small people dont have tons of money, then what can you do?>> 

The first question I have for Cee is what’s IN your agreement?  Most confidentiality agreements that I see downloaded from the Internet (where many entrepreneurs get their legal advice) have more holes than Swiss cheese.  They may be 1-pagers that simply say “we acknowledge that we’re sharing information and agree not to disclose it.� 

That’s not enough!  A good confidentiality agreement contains a lot more, such as: 

• Identifying the specific information that will be considered confidential 
• Detailing the actions OTHER THAN mere disclosure that will be considered a violation – such as doing an end run around you and “doing the dealâ€? with someone else (called “non-circumventionâ€?) 
• Limiting the number or identity of people within the company who have a right to know the information 
• Imposing confidentiality requirements on third parties (such as subcontractors) 
• Providing TEETH in the agreement!!!  (Can you hear my frustration?).   

One of the fatal flaws of most canned confidentiality agreements is that they don’t spell out what happens if the other side divulges the information.  (Acchhh – if I had a nickel for every lousy confidentiality agreement I’ve seen . . . .).  That’s where entrepreneurs and small business owners lead the fox right into the proverbial hen house.  There need to be penalties for bad behavior (improperly disclosing information).  Such as the right to bring an expedited lawsuit (called “injunctive reliefâ€?), the right to have your attorneys’ fees paid if found in your favor, the right to bring the lawsuit in your local courthouse (“jurisdiction and venueâ€?).  All of these things can make it v-e-r-y unpleasant for a party – especially one overseas — who has the inclination to pirate your valuable intellectual property. 

Confidentiality agreements can’t necessarily prevent the need to bring a lawsuit to enforce them.  But, if properly worded, they can make the process swifter (and less expensive); plus, a clearer case of infringement with a well-written agreement might make your case a more tempting one for an attorney to take on a contingency fee basis (in which case, you don’t have to front the legal fees).   

Final words:  especially if you are negotiating with an overseas company, do your due diligence!!  Find out if the company is reputable.  Learn about the customs of doing business (just how informal is it?).  Is there a culture of pirating? 

To those who say, “I can’t afford the due diligence,� I ask, “can you afford not to do it?�

When entrepreneurs start their businesses, they have a number of “Holy Grails� in mind.  One of them is being able to do business on a handshake (yikes!).  The other is finding the perfect 1-page written agreement for use with their clients and vendors.  Double yikes.  And where does that “perfect agreement� reside?  Somewhere on the Internet, of course.  Double yikes and an oy gevalt!

See Nina Yablok’s post, “The Perfect Contract? I think not� (besides, how can I argue with a namesake?).  To extrapolate on Nina’s point, one size does not fit all when it comes to small business contracts.  You and your best friend may both have started Internet businesses, but what you sell may differ.  Your payment terms may differ.  Your target market may differ.  Your marketing approach may differ.  Your legal terms and the laws of your states may differ.  And they may differ from a major corporation’s online business.   

So when your running your business, always make sure that your own attorney looks at it from your unique perspective.  After all, your business is unlike anyone else’s!  Doesn’t it deserve a little special treatment?