Ep. #1078 - Selling Online . . . Legally
In today’s episode of Startup Hustle, let’s try to determine if you’re really selling online legally. Legal repercussions on copyright infringement and other issues are a hassle. So Andrew Morgans and Russell Anderson, partner at Pullman & Comley, are here to share their inputs. Take note of essential insights shared, such as why you need a lawyer and how to protect your business from trolls.
Covered In This Episode
How does Pullman & Comley help their clients? What are the common mistakes online sellers should avoid? Why should you take time to be organized in business?
These hot topics are discussed by Andrew and Russell. Don’t miss out on their advice that can save you from a downward legal spiral.
If you’re ready, tune in to this Startup Hustle episode now. And be prepared to learn a lot, especially if you’re selling online.
- Russell’s background story (02:58)
- Trademarks, copyrights, and other legal issues when selling online (08:59)
- Americans with Disabilities Act (12:27)
- The threshold for getting insurance on your online business (17:10)
- Why should an e-commerce business hire a lawyer? (20:28)
- The importance of being organized with your business (22:36)
- What does it mean to be “organized on the backend”? (27:18)
- Common legal issues that e-commerce companies run into (31:18)
- How to contact Russell (40:11)
That kind of regular touch with your attorney, sort of hearing what they have to say. And talking about your business and what you care about. And something like the ATA issue that we just talked about, maybe I could have flagged that and said, hey, I’ve seen a lot of clients getting hit with this. It’s something for you to think about.– Russell Anderson
When an investor comes to look at your business, they will do legal, due diligence. And [if] you’ve got everything squared away, it is very impressive. And it makes you look professional. It makes you look good.– Russell Anderson
When it comes to advertising on Amazon, we’re advertising all around the brands, protecting and insulating them. You really don’t give these things as much, I guess, attention or value that you really should until something bad happens.– Andrew Morgans
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Following is an auto-generated text transcript of this episode. Apologies for any errors!
Andrew Morgans 00:00
Hey, what’s up, Hustlers? Welcome back. This is Andrew Morgans, founder of Marknology, here as today’s host of Startup Hustle. We’re gonna be getting right into it. I’m super excited about today’s guest. We’re covering a topic that we don’t always get into. So I think it’s gonna bring a lot of value for our listeners. Before we jump in and make an introduction, today’s episode of Startup Hustle is powered by FullScale.io. Hiring software developers is difficult. Full Scale can help you build a software team quickly and affordably and has the platform to help you manage that team. Visit FullScale.io to learn more. Today’s guest’s company is named Pullman & Comley, and today we’re gonna be talking about selling online legally. Before we do that, Russell Anderson, welcome to the show. I want to get into your story a little bit. We were jamming before we got started. And I feel like there’s a lot to you outside of just the company that you’ve partnered with, that you created and founded. And I want to jump into that and be true to the show. We always get into the backstory. So, Russ, I know, you know, we were even talking about your Citrix. Like, you know, browser, like slowing us up on the podcast. And security is always a point of concern legally but be as transparent as you want. Let’s have some fun today. Welcome to the show.
Russell Anderson 01:13
Thank you. Glad to be here.
Andrew Morgans 01:16
So are you in Connecticut today? Or?
Russell Anderson 01:20
Yeah, everything is in Connecticut. I live in Connecticut and work in Connecticut. So my firm is almost entirely based in Connecticut. We have quite a few outposts in other parts of New England, but almost entirely a Connecticut-based firm.
Andrew Morgans 01:37
Very, very unique. I think I’ll be in the same spot these days. You know, it seems like it’s more and more rare. So we’re based out of Kansas City, but maybe about four or five years into our company’s history, we started, you know, being in Florida and New York in different markets. So it’s definitely a change as you start to grow. But I’m super excited to have you on the show. And I think we’re gonna bring a lot of value around e-commerce. And how to sell and build a business legally, like what online selling is. But I know you have a big background. Did you always see yourself, you know, working in legal or being a partner in a firm like this? Or, you know, did your business or entrepreneur journey start before that?
Russell Anderson 02:18
So I actually did kind of view myself as always being an attorney. I actually went back to California to clean out my parent’s house back in the fall. And I found some sheets somewhere that literally were me giving a sort of what I think my life would be like in 20 years. And I mean, I’ve pretty much nailed it. I mean, I, you know, basically, it was like, I think I’m gonna be an attorney from probably when I was like 12 years old or something like that. So I did, I did follow the path that I kind of had set out for myself, but in terms of my, you know, journey within law firms, it’s, it’s been a little bit more, you know, bumpy, I think, you know, I went to, you know, went to law school graduated, had a really hard time finding that like that first gig. And so I found myself at this medium-sized firm in Connecticut. And, you know, the first day I showed up there, you know, one of the partners came up to me and said, Hey, would you like to do real estate law? And so, you know, I was like, Okay, that sounds okay. And I did real estate, and I did a lot of the types of things I do now in terms of like, you know, technology contracting, and, you know, other things, but, you know, five and a half years into my career, you know, the partner who was, you know, sort of my mentors retiring in a year, and I say, Okay, well, you know, what’s, what’s my path look like, you know, I’m gonna have to get trained up a little bit more on real estate to, you know, take over this practice in a year. And, you know, the partner says, to me. Literally, you’re not ready instantaneously. And then, two weeks later, someone showed up at my door and said, Thank you so much for telling us we didn’t have a transition plan. We’ve hired someone to take over that practice, which, you know, is just kind of a little bit of a shock when you’re, you know, because the normal pathway for law firms is, you know, typically, you spend like six to 10 years kind of building up, and then you make partner. And so here I am, right on that threshold of where you would start thinking about making a partner. And instead of, you know, making partner, they literally just had the door shampoo, you know, slam on my face. And so, you know, very quickly after Headhunter called and I moved on to, you know, another very small firm, there was just one partner and two associates, where I got to do a lot of really interesting, much more focused work in the kinds of things I really should be doing for my background, because I’m kind of, you know, a techie kind of person, especially for East Coast standards. And certainly for the standards of the sort of lawyers. You know, of my ilk, my age And so, you know, I moved on and did a lot more data-focused and technology-focused work for, you know, three or four years. And just I could tell that that firm was also not really going to support me. And so I moved on to a third firm that was great, a really good fit. But ultimately, that firm merged into my current firm, which is Pullman & Comley. And I got sort of taken along for the ride. And the nice thing was, they didn’t have me, you know, they didn’t really have the geek lawyer within Pullman & Comley when I merged in, and it was really nice, it was a really nice fit. So I’ve, you know, go right in, and kind of did the work that they really needed to have, you know, someone to do in terms of, you know, that kind of, you know, the kinds of technology contracting and privacy law and marketing and advertising type work that I tend to focus on, you know, in addition to just general corporate. And so, as a result, everything worked out, and I mean, partner.
Andrew Morgans 06:02
Okay, so is it a firm? Would you guys like, just for those of us that are, you know, less familiar with how some of those firms work? I know their specialties within it? Is your guys’ firm, you know, specific around? Is it corporate law? Is it like you have different branches of it? Because you guys are a bigger firm?
Russell Anderson 06:21
My firm is actually a very old firm in Connecticut. Okay, it’s, you know, it’s been, it’s been around for, you know, 100 years or whatnot. But in terms of the way that, you know, my firm works, and I think a lot of firms work is, you know, it’s a big collection of lawyers. I mean, we have roughly 100 lawyers, and, you know, everyone kind of has the things that they do well because the law is just too big for everyone to know everything. And, yeah, well, I’d like to think that I’m very good at a lot of things because, especially with sort of the diverse background that I have, it’s just, it’s just too much for someone to try to do everything. And so, you know, the nice thing with having, you know, a bigger firm, you know, certainly, you know, I think 100 firms is 100 lawyers is a nice size, is just that you have someone who can help you on just about every right?
Andrew Morgans 07:21
So, when you say, let’s just break this down a little bit, I know you’ve shared a little bit, but like when you say you’re the geek lawyer, or the tech, the tech lawyer, what does that mean in common terms, layman’s terms.
Russell Anderson 07:33
Andrew Morgans 08:19
Okay, so, guys, for anyone listening, that’s what gig skills mean in the legal world. But, you know, it’s something that definitely, you know, I move around in regards to having an Amazon agency that’s, you know, nine years old, and what we’ve seen, you know, patents enforcement on the platform, you know, e-commerce enforcement around patents, copyright, trademark, all the different types of a trademark from design trade, knowing the difference between design mark and you know, traditional how to go about getting it, you know, Amazon changed their a lot of their policies around trademark because you had in order to have an established brand on Amazon, at one point, you had to have a trademark registration, which could take nine to 10 months. They sped that up to a two-week process, in a lot of ways, which was crazy from when I started it being a nine-month process to like being able to get it in two weeks in regards to access on Amazon as if it was like, you know, you still have to wait for it to fish to be official nationally. But in that regard, wow, that was a game-changer. You know, I’ve seen it, so you have to know about that. Most people say, okay, you’re an Amazon expert, you’re an Amazon agency, you’re managing brands, well. I know way more about trademarks and patents and enforcement and all of that than I probably should have, you know, working hand in hand with what either legal or just sellers are trying to figure things out and then being like, wow, this is a whole arena, all the way down to you know, software like I don’t know, there’s been a ton of legal issues around the Amazon marketplace in general in regards that people get in trouble for doing things unlawfully are bribing officials or bribing workers in different countries that are touching Amazon things because it’s huge commerce, these things that, you know, people are like, Oh, they’re gamifying reviews they’re doing things like this results in millions and billions of dollars in some aspects depending on who you’re talking about. So, never take that lightly. I really just thought, like, how to, you know, I definitely moved out of like a, what is this phase two? I want to be a white hat. And in this space, you know, I was a computer scientist. I have a degree in computer science in regard to networking and security. So as always, on the site of studying and learning, like anti-hacking, you know, how to be more secure, how to have a safe network, you know, how to build security. Against attacks like this, I worked in a knockout college, which is just security. Network Operations Control security for MasterCard was not my passion, it was definitely not my passion, but it definitely was my education in a lot of ways, and I learned that quickly. But I took that into a, you know, I think that was just my approach when I came into this industry, like, Oh, I’m gonna do things the right way. Because that’s kind of like, you know, the way I gravitate. But it’s super interesting. And I continue to learn. And I think one thing that we can talk about on the show is like, maybe even talking about some common mistakes that online sellers fall into whether it’s e-commerce, b2b, Amazon, a lot of them are the same, just like the medium that they’re selling is the same. I recently learned about ADA compliance. Like, I don’t know what you have to share on that. But that was something that I just wasn’t aware of, you know, but that could be potentially a big risk too, you know, a young brand starting out.
Russell Anderson 11:47
Yeah. And I can, I can certainly speak to that. So what’s happened with the Americans with Disabilities Act is it used to be about brick and mortar? And, you know, so basically, you have a physical space, and there’s certain types of entities that are what are called public accommodations, and those are the ones that are supposed to apply, you know, that this is supposed to apply to. And, you know, what has increasingly happened is that, you know, plaintiff’s lawyers, and again, I say this, you know, as someone who thinks that accessibility on websites is a good thing, but lawsuits against entrepreneurs, you know, are not good things. So, you know, I think there’s, you know, so, you know, the good thing with this, I guess, is if I educate you in advance, you can avoid the plaintiff, lawyer, you know, the plaintiff’s lawyer, you know, coming after you later. But then, you know, what’s happened is that, you know, the plaintiffs bar realized that they could essentially force every business in America to have an accessible, you know, website at the, you know, basically, by sending demand letters and or suing to force businesses to meet the accessibility standards. So the accessibility standard that everyone’s trying to be forced to meet, according to the plans so far, is the Website Content Accessibility Guidelines, which are also known by the acronym WCAG. And I believe the current threshold is 2.1, level double A. So that’s the standard. And there are tools actually, that will help you to determine whether or not you meet the standard. So an example of this would be the WAVE tool, which I think Utah State has on their website, I could be wrong about which institution offers it. But you know, it’s really neat. I mean, it’s a plugin that goes into the browser, you can go and look at your own website, or really any website, and just, you know, see if, you know, see what is wrong with your site. Before the plan for spar, you know, finds you because what’s what I think what’s happening is these, you know, the plaintiff’s attorneys, you know, troll the internet, you know, run similar tools to go find websites that, you know, are doing the right things, things like, you know, offering all text on, you know, images, you know, easy low hanging fruit things to prove. And then they file suit, or they send a demand letter, basically demanding that you, you know, meet the standard Oh, and pay them, you know, several $1,000 in their legal fees for the privilege of telling you that you weren’t doing it right in the first place.
Andrew Morgans 14:29
Yeah, it’s definitely not a good feeling what they’re doing in that regard, but that’s why I’m, you know, I’m bringing it up on the show is to just make people as aware as they can, you know, better to spend a couple 100 bucks to be in control of that. It’s a good thing to do as well. Sure. I do believe that it’s a good thing to do. But, like you said, not at the expense of, you know, ruining someone’s business or, you know, hitting them with a 10,000 $20,000 You know, Bill for, you know, not having some kind of compliance on their site. You know, for most websites, there’s simple plugins like you mentioned, that can either that or that can help you get that done. And that’s something that we did last year, just across our sites that we work with, you know, we built our own brands and just making sure that they were compliant, I think it’s the same thing, as, you know, if you’re in real estate and rentals or in any other business, like you’re exposed, and in the web, there’s just not, it’s still so Wild West, that, you know, there’s not a lot of thought leadership, like even this podcast, this episode, what we’re talking about online, like selling online, legally, and what that looks like, there’s not a lot of content out there that saying, Hey, these are some of the pitfalls you can fall into. Because it hasn’t happened to that many people yet. You know, having insurance on your products is another one, let’s talk about that. Just like at what level of a small business, a little maker selling with an Etsy shop or a website or on Amazon, you know, what do you really need to be doing or thinking about to protect yourself with your products? You know, we’ve all heard about someone getting sued, like McDonald’s getting sued for hot coffee, you know, it’s hot coffee, you know? Was the label not big enough? Like, what was that about? And you can think about your products and be like, Well, how is anyone going to hurt themselves with the phone case, or, or this or that, but there are certain things you need to think about. If you’re really trying to build a brand online and sell to protect yourself? Do you know, like some of the thresholds for like, when you need insurance on your business as an online business? Like what threshold that looks like?
Russell Anderson 16:30
Yeah, that’s an interesting question. I don’t know, if there’s like a specific number at which you cross the threshold of I should go get insurance. But I think there’s a way of thinking about this. So when you start a business, presumably, you should form some form of, you know, limited liability company, whether that is an LLC for, you know, a more formal Corporation. And, you know, basically, what you do is you put your, your business in the LLC, or the corporation, and you basically say, These are the assets that are tied to this business. And if there’s a claim, these are the assets you can go after, right, and so by doing that, you kind of build a certain amount of insurance in the first place. And then obviously, you hope that your business will grow and expand. And you know, when it’s big enough that it justifies spending the money on the insurance premiums, because you wouldn’t want to lose all the things that you’ve now put in this box. That is, you know, your company, you know, that’s really where that threshold, you know, kicks over. And so, I’m not exactly sure what the premiums are on, you know, products, liability insurance, but let’s say they’re, like 10, grand, you know, or something like that for a small business that, you know, sells enough units to make a difference. You know, if your business is worth, you know, $300,000 a year, absolutely, you should be spending the 10 Grand on the products liability insurance to, you know, make sure that you can control that risk. If on the other hand, it’s 10 grand versus 10 grand, then you’re probably not in that equation. Yeah. Right.
Andrew Morgans 18:05
That’s, that’s good advice, I do believe it to be quite a bit less than that, at least for that size of business, like, you know, sub 1 million. But you know, you start adding up these costs when you’re just like, maybe for the first part, you’re like, This is a side hustle, turning into a business. And in a lot of ways, that’s how a lot of people’s business starts. And this is something that they’re doing for extra money or passion. And they’re not thinking through all these things, because you start adding those things up. And it’s a lot of reasons to say no, you know, it’s a lot of reasons to be like, this isn’t even worth it. I’m paying 5000 and insurance, I’m paying, you know, 500 a month to have ADA compliant websites, where I’m playing like, you know, yada yada, yada, the list goes on, and on and on, there can be a lot of reasons why not to do something. And that’s not what I’m trying to share. But more so like, once you get to the point where your business is bringing in revenue that’s substantial to you. These are things that you need to start thinking about, and how to protect yourself and insulate and solidify your business, from those trolls from, you know, people that are just looking for an opportunity. We’ve got a couple of questions for you. But before I do shout out to our sponsor, FullScale.io Finding expert software developers doesn’t have to be difficult, especially when you visit FullScale.io We can build a software team quickly and affordably. Use the Full Scale platform to define your technical needs, and then see what available developers, testers, and leaders are ready to join. Visit Full Scale dot.io to learn more. So a couple of points I wanted to bring up and make sure our listeners walk away with like, Why do e-commerce companies need legal advice or a lawyer on retainer or need that as part of their team? And let’s start there before I hit you with the next one. I don’t I don’t want to complicate it. But I think that that’s one that’s just like, why do I need a lawyer as an e-commerce business?
Russell Anderson 19:48
Right. And I think the main thing is just a lawyer can keep you out of trouble in the first place. I mean, I’ve had a couple of different clients. For lack of a better way of putting it you know, they just didn’t Talk to me, like, you know, I was there counsel, I was doing work for them, but they just weren’t, you know, I think in part maybe to minimize the bill or whatnot, you know, they just weren’t having me work on, you know, sort of the day to day things that they were doing. And, you know, in each case, they didn’t really have a good set of commercial terms with their customers. And so this was a b2b scenario. And, you know, in each case, there were problems with the product or, or the relationship. And, you know, they ended up getting sued. And so I’ve had two different clients get sued them last year, where I mean, frankly, I could have prevented, you know, I might have been able to rent the suit altogether, or at the very least, put them in a much better position, you know, within the lawsuit for, you know, for just not having damages really against them. And so, you know, it’s, it’s a struggle, because, you know, ultimately, I care about my clients and seeing them, you know, have to spend, you know, a lot of money, you know, legal fees sounds like a great thing for me, but it’s, it’s not really my preferred position, like I’m a corporate person, and I want my clients to succeed and do well, without having the stress of litigation and bad things happening to them. And so you want them to stay in business, you want them to stay in business. And so, you know, I think, you know, I think that kind of regular touch with your attorney, and sort of hearing what they have to say, and talking about your business and what you care about, and maybe, you know, something like the ATA issue that we just talked about, you know, maybe I could have flagged that and said, Hey, I’ve, I’ve seen a lot of, you know, clients getting hit with this, something for you to think about. And just seemed like, you know, getting people ahead, and that’s the kind of the relationship with a lawyer that you can, you know, hopefully establish, yeah, and it’s so much better to be in a position where you’re paying for that legal advice.
Andrew Morgans 21:56
When you’re not, you’re not in trouble. You’re not, you’re not already in trouble. Now you’re paying to defend and like, you know, just get yourself out of it. But, you know, I’m gonna spend a couple grand here and get more insulated and prepare to get some better advice, or I’m gonna get my contracts better. This is just like something I thought of, while you were sharing, how important do you think it is? And this is coming from my own perspective, but I want to hear from you. How important do you think it is, for a young business owner, or, as in the business being young, or a newer business owner, to like, be organized, when it comes down to defending them, when it comes down to like, really getting yourself out of trouble, you know, like defending your case, or like, you know, being able to present. Or, at least in my experience, it was like, you know, if I had been documenting better if I had been like, you know, paying more attention to contracts, or different things like that. Most of the time, whatever I’m into, I can get out of or I’m like, I’m in the clear, I’m like, you know, I’m protected. It’s been the times that I wasn’t taking good notes, or documenting Well, or like really being organized and couldn’t find stuff that I needed that I felt the most exposed as just a general rule of thumb. When it comes down to those things, and you’re like, trying to help somebody that’s in trouble, like, you know, how important is that?
Russell Anderson 23:24
I think being organized is very well, I mean, just in general as a life skill. It’s obviously very helpful. I think, in the legal world in particular. I mean, yes, it’s very helpful for really all different types of things. I mean, everything from, you know, just making sure that you’re on top of, you know, the customer contracts, or the supplier contracts, or you know, whatever it might be. The interesting thing is, it’s not even just, you know, as you’re going day to day that the organization matters, it matters on the back end. So when you actually go to sell your company or raise money, the fact that you have your stuff together really matters. Because when an investor comes to look at your business, and they will do legal due diligence, and you’ve got everything squared away, it is very impressive. And it makes you look, it makes you look professional, it makes you look good, it makes you look like you’re someone who’s worthy of you know, having this investment or frankly, you know that they can trust that they can buy your business entirely. So it’s a weird kind of thing to think about. But when you’re starting your business, if you’re organized and doing the right things, it flows all the way through to when you’re actually trying to sell either parts of or all of your business.
Andrew Morgans 24:46
I think there’s like, really two two types of like, you know, entrepreneurs or business owners or whatever you want to call it, I’m generalizing. But in general, there’s like you know, I’m more of the creative side like I was a musician before I got into this and I’m a little bit of a hybrid because I was a techie. But I like to be creative, you know, and it was like, that’s really what I love about e-commerce is because I feel like you get to be creative and invent and be innovative. But then also you have to have a technical background to operate it and implement it. So but before I found e-commerce, it was, it was music, it was all these things. And I’m definitely someone that I like, was very forward and early in the Amazon industry in space, like a creative, almost like a creative move, you know, caring about something before other people do. But I’ve had to learn the skill over the last eight years, nine years of getting organized, and systems and process and there’s the other type of people that are, they start with that foot forward, they might be a little bit less creative and innovative, but like everything’s got its its proper place, and documentation and, and systems and scale. And those things come naturally to them. So wherever you are on that kind of tipping point, from my end, I’ve always just wished now that I’ve learned some of these things like, Man, I wish I had documented all this, I wish I had been so much more organized. What does it look like when you talk about on the back end, and being organized for a company that’s trying to buy you because that is definitely something I mean, I’m actually in courses, not that I’m looking to exit, but I’m in courses, getting coached on all the things to think about for an exit, and what that looks like, just so that I can prepare as best as possible. Is that like having all of your contracts in nice little folders? Is that like, you know, knowing, you know that your system, your business can run without you? Is that like having clients that might be here and long term contracts? Like what does that actually mean to be organized on the backend?
Russell Anderson 26:38
Right? So an easy way to sort of do this, as I bet you if you Google, and I haven’t done this myself, but if you Google due diligence checklist, you know, or legal due diligence checklist, I bet you can find something that sort of breaks down the kinds of things that, you know, lawyers are going to be asking of you, you know, when you go to exit, or when you go to, at the very least, you know, do a do a fundraiser, you know, do a financing round. And so you have to sort of break your company into bits. So you think about your company as a corporate entity, you know, so if you’re an LLC, do you have an operating agreement? Does it document Well, what your ownership structure is, and how you’re run? Do you have minutes to show that if you have a board that, you know, show the decision making process that has gone on, on the major decisions, so if you did, like, if you did bite bank financing, that you have minutes of showing that you approve, you know, the bank financing? So that’s, that’s like one aspect of it. And then you might have an employee aspect of it? Do you have a complete handbook? You know, do you have, you know, good employee contracts with, you know, your executives, to, you know, reflect, you know, what those relationships are, like, do you have, you know, good customer and supplier relationships and contracts there. And, you know, and you can break your business up into all these little component parts. And if you look at a due diligence checklist to kind of get a sense of what that might look like. And obviously, the more that you have in place, the better you look. I mean, I’ve certainly, and look, I mean, if you haven’t done it, I’ve seen businesses sold literally last year that I’ve worked on, where they did nothing. I mean, it was the business I was jokingly calling this business non legal. Like, they had done everything on handshakes, and, you know, with with no attention to legal for, for 20 years, built a good business, and were able to sell, and it worked out and it was, you know, find them, you know, I was on the buy side and our buyer, you know, in that instance, you know, was was reasonably okay with that, and, but, you know, it still creates friction, when you you know, as a, if you’re the buyer side, you’re trying to get a business that’s clean. And so the more that you, you know, have, you know, these points where it’s just not that clear that everything’s been done correctly, there’s that extra nervousness that comes in and sometimes that can affect the deal terms. So for example, you know, a lot of m&a transactions will have, you know, escrows and whatnot of money being set aside to cover potential claims. And, you know, if the business is not particularly clean, and the buyers nervous that the escrow demand might be higher, because they’re just less confident that everything has been, you know, managed correctly.
Andrew Morgans 29:34
So, it’s like buying a property and doing inspections and being like, you know, we just don’t really know what this you know, floors, like once we’re gonna rip this this carpet up, you know, we just don’t know or foundation being, you know, and they’re gonna come back and make a lower offer because, you know, they don’t, they don’t know all these things, or maybe, you know, in that circumstance just to relate it like, you know, someone’s looking at the foundation of your business and having questions. You know, it’s going to be a question mark on that process. So instead of it being like, proactively, so we’ve we’ve like, you know, we’ve talked about proactively, like what you can do, which is like being organized and being ATA compliant, and you know, getting your trademarks or like, those are all pretty much proactive things you can do, you know, to not get in trouble. Let’s end the last part of the show. hearing from you a little bit about, like, what kind of issues e-commerce companies run into with trolls or like, just with, I guess, people looking for opportunities to like, you know, have a lawsuit or get a brand in trouble? What are some of the issues that you’ve seen working with e-commerce companies?
Russell Anderson 30:38
Yeah, so some of these, some of these are actually kind of easy to really flag out. So an easy one is copyright issues. So, you know, generally with with images, it’s the person who created it. So if it’s a photographer, it’s the person who took the picture, you know, owns that particular, you know, photo. And increasingly, what I’ve seen is that, you know, sometimes people will just, you know, use things they find on the internet and say, I can use this right? And the answer is no, and what’s happening more and more is that, especially for things that might be, you know, stock photography, or from the big agencies, you know, they have someone trawling the internet with, with bots, looking for, you know, where, you know, images get used, they find that you’ve used an image, and, you know, they’ll have a lawyer send a demand letter for, you know, roughly maybe $5,000 1000, or whatever it might be saying, you use our image without our permission, without paying, you know, pay us and it’s just such a, it’s such an unforced error. Because it’s, it’s so easy just to, you know, if especially for stock photography, you know, just pay the money for, you know, or just the very least understand, you know, where the images you’re using come from, and, you know, make sure that you have the license, you know, and if it’s a friend who took the photos, or, you know, someone you know, that you’ve paid, or maybe you haven’t paid them, and that’s the problem, you know, it just you gotta you have to make sure that before you start building your website, based off upon these, these photos, that you make sure you have the rights, because if you don’t, and let’s say, hypothetically, you have a dispute with your photographer, and you’ve had them take, you know, 1000 photos for you over your entire product line, but then they try to charge you triple, you know, you might be in a position where they’ll try to take your whole website down using a DMCA complaint. And, and trust me, no, mean build, the website will do it. Because the alternative is really just to have a copyright claim against the website itself. And so it’s, it’s that That, to me, is an unforced error is, you know, so just making sure you have the copyright rights, you know, set. I think another example is obviously in your mentioned this, Andrew is trademarks, I mean, making sure that, you know, when you go to brand, that you really, you know, make sure that you have, you know, some proper clearance, you know, in the, you know, copper clearance done, you know, make sure that you you know, you understand sort of where you live within an ecosystem with your brand, it’s very rare that you’re ever going to have like a perfect Cooley clear, completely imaginative brand that no one has anywhere near you. But at the very least you can, you know, understand sort of what your risks are, before you go to market with a particular, you know, branding, and especially, you know, if you’re taking something like, you know, like, I’ll just give an easy example, that if you’re going to, you know, be using something with three stripes, you know, you know, you know, Adidas is going after literally everybody with that, like so if you’re adjacent to somebody that’s really aggressive, like clothing companies, I think are infamous for this, especially, you just know that you shouldn’t be going into that ecosystem. And picking that fight. You know, and I think and this is, I think what you were thinking about a little bit in there is also just, it’s not just how you stay out of trouble, you know, from, you know, plaintiffs lawyers and others, but I think it’s also how do you defend your brand? And so, you know, a lot of law, and a lot of what I’m sort of talking about is sort of, you know, thinking about law as being, you know, a shield, right? And so, you know, saying if I do all these right things, like I’m going to be protected against this kind of claim or this. But, you know, I think sometimes you have to think about sort of using, you know, when you can do things to help protect yourself a little more aggressively upfront. And so, you know, an example of this, as I’ve seen, you know, a few different, you know, clients of mine, you know, have people kind of impersonate them Yeah, and so you know, if you create, you know, a brand, like, you know, Startup Hustle, you probably want to own 50 domains around it. Right? So startup hustles, startup hustle.org, Startup Hustle, done that, because if you don’t, then, you know, someone can abuse you like that. And then all of a sudden, like, you know, they start sending out emails impersonating you, you know, maybe doing scams.
Andrew Morgans 35:32
It’s happening to me right now on social media, like, you know, there’s probably three accounts or so on Instagram, that look, it’s crazy, because they actually have like, my videos, my posts, like everything, right? It’s like a nuance of a letter and underscores something you can’t even really tell even if you’ve been following me a long time. And they’re sending out DMS, you know, they’re like, acting as me at this time, and going straight to Instagram does nothing for me.
Russell Anderson 35:58
Exactly. It’s so I mean, it can be really hard to affirmatively stop these folks. Because, again, even if you own 50 combinations, you know, there’s always probably going to be the one that you miss, but at the same time, you can, you can really narrow the field and make it that much harder for them. And, you know, I’ve had clients, you know, within the last year, really, this one really rapidly expanding, you know, e-commerce and also just retail physical retail company, you know, really run into trouble against someone who was out for them, you know, basically copy their website, you know, changed one letter in the domain, somehow, I don’t know how, but effectively got them out of locked out of their own Facebook account was running ads, basically pretending to be done, you know, and point by point we went through, and, you know, managed to get most of these things down over time. Certainly having a registered trademark in this helps, because it just makes that process that much faster to get these things down. But, you know, you really, it’s, it’s hard, you know, and it’s, it’s reactive. And so the more that you can do upfront to sort of limit the issues as much as you can, the better because that’s, you know, that’s really all you can do to protect yourself.
Andrew Morgans 37:29
Think of it like creating a moat-like it’s an old school, you know, thing but like the water around the castle where you know, the whoever’s attacking the castle can’t even get close without going through this tar there’s, you know, there’s water slows them down, you know, so they know castles have still been seized, or there are other ways of doing it, but it really slows things down. And I think that’s kind of what I think of as, like, you know, insulating yourself with trademarks and or copyrights $60. Like, you can get a copyright on your images that you’re using for like $60 If you submit it yourself or something like that, you know, which is it’s not a trademark, it’s not a patent, but it’s a lot more than having nothing at all, and on channels like Amazon it’s enough to be able to police your brand. And you know, most people just think, as you know, they’re not thinking about why they don’t want to spend 64 that well, what are you losing in branding? Or what are you losing in a reputation? Or what are you losing in potential sales from not doing those things? So you know, a lot of times when it comes to advertising on Amazon, we’re advertising all around the brands and protect them and insulate them, and you know, you really don’t give these things as much, I guess attention or value that that you really should until something bad happens and that’s what’s like you know so bad about those kinds of things is that it really takes almost like getting whacked upside the head so to speak, for you to be able to pay attention to this stuff. And as an agency owner and you on the other side. I think we can both. You know we’re just harping on. You know to pay attention to these things. You’re not a victim until it happens, you know, kind of thing, but like, once you get in deep with a competitor that’s really out for you, it can be really bad. And you know, what are the things you’ve done to protect yourself? This is a great lot of value, Russ, you know. Thank you for sharing all this. We’re coming up on time, so I have a hard stop for us, but before we jump off where people can come in contact with you, you know, your personal brand, you know, if they’re looking for legal help, like what’s the best way to contact you directly? You know, outside the firm.
Russell Anderson 39:31
Sure. So the best way to contact me is just, you know, Russell Anderson, and that is RAnderson@pullcom.com, which is my email address.
Andrew Morgans 39:41
Okay, can you spell it? Can you just spell that person with an O at the end?
Russell Anderson 39:44
And that’s at pullcom.com.
Andrew Morgans 39:50
Perfect, and we’ll have all this in the show notes for anyone that’s like, you know, on a computer listening to the podcast, but for anyone driving. I hope that’s been helpful. Um, you know, we’re sharing this kind of information for free. And you know, these are this is not stuff that you get all the time, and you know, I don’t love talking about all the bad things that can happen, but I think it’s important to really think about, and it’s more so like, you know being in the gym, being healthy being fit stretching so that whenever as something comes along, you feel like you know, you’re prepared to handle whatever comes. So, Ross, thank you so much for your time. It’s been awesome having you on the show. Thank you. Appreciate it. And, Hustlers, shout out again to our sponsor, Full Scale. Do you need to hire software engineers, testers, or leaders? Let Full Scale help. They have the people on the platform to help you build and manage a team of experts when you visit FullScale.io. All you need to do is answer a few questions and let the platform match you up with a fully vetted, highly experienced team of software engineers, testers, and leaders at Full Scale. They specialize in building long-term teams that work only for you. Learn more when you visit FullScale.io Always a mouthful, always a lot of fun. Hanging out with you guys, Hustlers. Thanks for tuning in. We’ll see you next time.