Posts tagged Legal
Next Step in Crowdfunding Growth: Make It Legal
Dec 5th
In previous months, we’ve covered here in ReadWriteWeb a new and emerging concept called crowdfunding – a way for entrepreneurs, especially apps developers, to obtain just enough funding to get off the ground, by way of a handful of collected funding sources contributing no more than $1,000 each. It’s a superb alternative for businesses as small as one person to build an app and place it in the cloud.
The problem is, it’s not officially legal. Not that there’s any enforcement against the practice at the moment; in fact, last week the House of Representatives overwhelmingly approved by a vote of 407 – 17 language that amends the Securities Exchange Act of 1934, in order to exempt crowdsourced funds from having to clear legal hurdles from every state from which a member contributes funding.
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But a last-ditch effort to rile up some opposition to the Senate version of the bill, perhaps from Senate Democrats, is being put together by the North American Securities Administrators Association (NASAA). Their theory is this: Internet-based ventures are more speculative, and are thus more susceptible to carpetbagger-like shysters who could take advantage of entrepreneurs through spamming techniques.
Aren’t there plenty of banks?
In testimony before the Senate Banking Committee last Thursday, NASAA President Jack Herstein argued that crowdfunding would not even be necessary if entrepreneurs could easily get the funding they needed from banks. And since such easy funding from banks is readily available, then perhaps there’s something wrong on the entrepreneurs’ end.
“If a company cannot get financing from a bank, an SBA loan, a venture capital fund, or even friends and family, it is probably because there is a significant risk that the investment is extremely risky,” Herstein told Congress. “The critical questions are: Have these sources stopped funding small businesses? If so, why?
“If the answer is that funding is not available because banks are not lending as they should, or because traditional sources of small business capital are unavailable even to well-qualified, established, or very promising small business endeavors, then this has the potential to stifle small business growth and hurt the economy,” he continued. “Therefore, Congress might consider certain steps to minimize or remediate this needless loss of productivity. On the other hand, if the answer is that traditional sources of small business capital have reviewed the particular small business applicant and determined that the risk is too great, then we should not allow that applicant to seek investment from unsophisticated, ‘mom and pop’ investors without appropriate investor protections. The typical retail investor, unlike the traditional small business financier, does not have the ability to conduct a reasonable investigation of a start-up or development-stage entity.”
The Senate bill’s key sponsor is Sen. Scott Brown (R – Mass.), who suggested last week that “mom and pop” investors should have greater opportunities to fund “mom and pop” entrepreneurs without as many as 50 state governments standing in the way, arguing over jurisdiction.
“At a time when technology and social networks are shaping our daily lives and driving our economy to new frontiers, the small business and start-up communities are stuck with investor regulations that predate the first computer,” stated Sen. Brown. “With these fossil-like rules tying down our entrepreneurs, it’s no wonder a lasting economic recovery has been so hard to achieve. This bipartisan jobs bill seeks to replace outdated restrictions so that small businesses have new ways to access capital and can more effectively compete in the global marketplace. It cuts the red tape that prevents small businesses from connecting with investors and, while retaining important investor protections, opens the door for more Americans to invest in new companies and their cutting edge ideas. If we pass this bill, opportunities to invest in the next Facebook or Google won’t be limited to the most affluent Americans.”
It’s always sunny in Washington
Recent amendments to the Senate language could improve the chances for the bill among some opponents, who had previously sided with Prof. John Coffee of Columbia School of Law. Last week before the same hearings in which Sen. Brown testified on behalf of the bill, Prof. Coffee suggested that passage of the bill could lead to carpetbagger chaos. He suggested a compromise approach would prevent crowdsourced funds from actively soliciting potential customers, including via the Internet, and also make certain that any party that does solicit potential investments as well as customers register themselves with federal and/or state authorities.
In an effort to make his testimony more memorable (which probably worked), Coffee added this: “Failure to adopt this approach or some similar variant would likely mean that every barroom in America could become a securities market, as some unregistered salesman, vaguely resembling Danny DeVito, could set up shop to market securities under the crowdfunding exemption. Under the current version of S. 1791, such a person could open his laptop on the bar, show slides of a half dozen companies to the bar’s patrons, and solicit sales. This will create few jobs – except for dubious unregistered salesmen – and much fraud.”
Under the amended bill, entrepreneurs could be introduced to the existence of such funds by way of so-called broker intermediaries, which may include consultants such as Sramana Mitra. Her One Million By One Million (1M/1M) initiative (not to be confused with a brokerage) has a goal of enabling one million entrepreneurs to obtain $1 million in investments annual revenue by 2020. Perhaps not coincidentally, the Brown bill would limit the total size of securities available through crowdsourced services to $1 million.
[Danny DeVito photo from ComicCon 2010 by Gage Skidmore.]
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Google’s Legal Woes: U.S. Government, Motorola, AT&T … Al Franken?
Sep 29th
A number of updates on Google legal and antitrust woes cropped up this week, as the Department of Interior/Microsoft case came to a close, the Google/Motorola deal received a second request, and Google filed to prevent release of proprietary infor…
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SEO Legal Services weighs in on big anti-foreclosure lawsuit – Athens NEWS
Sep 6th
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SEO Legal Services weighs in on big anti-foreclosure lawsuit
Athens NEWS An attorney with a local legal aid agency has signed onto a "friend of the court" brief filed with the Ohio Supreme Court in a case that could have a big impact on home foreclosures in the state. The brief, in US Bank National … |
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Google Buys 1000 IBM Patents as Smartphone Legal War Intensifies – International Business Times
Jul 31st
 New York Times |
Google Buys 1000 IBM Patents as Smartphone Legal War Intensifies
International Business Times Blog SEO by the Sea first reported the news. A Google spokesperson subsequently confirmed the purchase via an emailed statement. The patents Google bought span a wide range of fields that may or may not directly involve smartphones. … Google Buys IBM Patents Google acquires over 1000 IBM patents Google buys up 1029 IBM patents |
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Cartoon: “Let those who worship evil’s might, beware my legal team!”
Jul 10th
If the minions of Satan ever want to seize your soul, they don’t have to trick you into signing it away in exchange for untold wealth, fame or a sneak peak at Uncharted 3: Drake’s Deception.
All they have to do is tuck a provision into the iTunes user agreement. Something like “The Licensed Application and related documentation are ‘Commercial Items’, as that term is defined at 48 C.F.R. §2.101, consisting of ‘Commercial Computer Software’ and ‘Commercial Computer Software Documentation’, as such terms are used in 48 C.F.R. §12.212 or 48 C.F.R. §227.7202, as applicable. You further agree that your immortal soul, and all derivative works thereof, are the sole property of the Dark Lord.”
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But you know what? That’s how it ought to be. User agreements should be interminable, impenetrable and indecipherable, because:
- The online economy is the only one that actually seems to be working at the moment.
- The legal and business environment most online companies operate in demands that they impose outrageously sweeping conditions on users.
- If we knew just how much of our freedom, privacy and personal autonomy we were surrendering, we might opt out. And at the very least, it would depress the hell out of us.
It would be the height of irresponsibility for companies to come clean with users about just how draconian those terms of service are. They would threaten both the fragile economy and the even-more-fragile public mood.
So it’s our economic and social duty not to read too closely. Instead, scroll down as quickly as you can, click “I Agree” and enjoy that brief whiff of brimstone.
When I first wrote the caption for this cartoon, it read Repeat after me: “In brightest day, in blackest night, no evil shall escape my sight, subject to the terms and conditions of the attached 56-page user agreement.” But a quick bit of focus testing revealed that hardly anyone got it, because so few people recognize the Green Lantern oath.
Honestly. What are they teaching in schools these days?
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Internet Legal Marketing Consultant: Expertise, Ongoing SEO Effort Is Vital to … – DigitalJournal.com (press release)
Jun 20th
 PR Web (press release) |
Internet Legal Marketing Consultant: Expertise, Ongoing SEO Effort Is Vital to …
DigitalJournal.com (press release) A winning search engine optimization (SEO) campaign takes expertise and steady effort, national law firm Web marketing consultant and Consultwebs.com CEO Dale Tincher writes this week on the company's blog site. “Turning on a website and walking away … Internet Legal Marketing Consultant: Expertise, Ongoing SEO Effort Is Vital to … |
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Twitter Reveals British Celebrity Sins Despite Legal Injunctions
May 24th
In British law, a “superinjunction” is a gag order on the press that extends even to reporting on the fact that there is a gag order on the press. In U.K. courts, these superinjunctions are apparently handed out like popcorn on behalf of any strutting boob with enough pounds sterling or screen time to get the judge’s attention. This can hardly be surprising for a country whose libel laws are so biased that it has given birth to “libel tourism.”
Now, the Twitterverse has no such law. I think you can figure out what happened next. Although newspapers have been fighting against superinjunctions for some time, with one, the Sun, even kicking at the boundaries, one Twitter user just up and pegged it right in the gear.
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An anonymous user created a Twitter account, @superinjunction, with the apparent purpose of posting six tweets about the subjects of various injunctions; including actors, a soccer player and a chef.
Now, according to Forbes, the Twitter scoop is “forcing British lawmakers to think about whether such a thing is still feasible in the age of social media, and if it is, how to enforce it.”
What the tweets have done, I think, is given the British press a legal pretext for reporting on the injunctions. They are, the logic goes, not reporting on the material the injunction covered, but on the fact of the injunction being blown.
The first news organization to take this tack is Glasgow’s Sunday Herald. They’ve put a photo of the soccer player, Ryan Giggs, on the front page of their newspaper with a twee black bar over his eyes. It snowballed from there.
The article, an indictment of the superinjunction system and its hypocrisies, attracted enough traffic to crash the Herald’s site. (It’s up now.)
Giggs is pursuing a suit to force disclosure of the Twitter account holder’s name. (He tried to press the suit anonymously but was found out, which seems to be a theme with him.)
Whether the reality of social media will force a change in British law is certainly beyond me. I feel confident, however, in saying that people, like it or not and regardless of the law, will continue to use social media tools like Twitter to tell tales out of school.
Other sources: Technology Review
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LawPivot Takes Its Q&A Legal Advice Site Nationwide
May 19th
Legal questions about the establishing, incorporating, or funding a startup are among the most common that entrepreneurs have. There’s perhaps a distrust of lawyers and a sense that legal advice will be too costly. As we’ve written about before, LawPivot tackles this problem by providing a place where startups can ask legal questions and get crowdsourced answers from qualified lawyers. By doing so, LawPivot lowers some of the barriers that startups might face – legal and logistical – when trying to find a lawyer.
Up until now, this service has only been available in California, but LawPivot announces today that it’s opening availability nationwide.
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LawPivot’s co-founders, Jay Mandal and Nitin Gupta, are both lawyers. Mandal was the lead of Apple’s mergers and acquisitions team, and Gupta was an IP attorney at a several national firms. They bring to the table, then, an understanding of the needs of entrepreneurs and lawyers, the latter of whom are finding their own profession changing and are needing new ways to develop their businesses.
Both businesses and lawyers can register on the site, which is unveiling its new product today. This includes better profiles for lawyers, which will include information about how frequently they answer questions on the site and by extension what their online reputation is like. Lawyers can also add background information to their profiles.
All of this is in the service of making it easier to match businesses and attorneys, and LawPivot has improved the searching capabilities on the site so that it’s easier to identify lawyers based on their responsiveness, quality, contribution to the community and legal expertise.
As always, and unlike other Q&A sites, the questions you pose to LawPivot are confidential. You tag your questions with relevant keywords, which helps the site’s recommendation engine identify the best lawyers for the job. It’s the addition of recommendations and algorithms to this sort of online inquiry that LawPivot’s Gupta describes as “the next direction of Q&A.”
The site is still free, but following its free trial period, LawPivot will charge companies on either a per question or per monthly basis.
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Legal Woes Mount For Google: “Locationgate,” Skyhook Suit And FTC-Search Probe
May 2nd
Following the revelation last week that the iPhone stored user location data a consumer class action was filed. This kind of disclosure/revelation-class action cycle is now familiar. And because Google also collects location data it is now also the subject of a similar class action (Brown et al v….
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