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Alternative Dispute Resolution

When Should You Use Alternative Dispute Resolution in the Sale of an Internet Business?

By Internet Lawyer, Website Lawyer, Website Legal Documents

alternative dispute resolution

When you’re buying or selling an Internet business, you can reduce the chance of an expensive lawsuit where no one truly wins by using alternative dispute resolution (ADR) provisions in your legal documents that paper the deal.

What type of alternative dispute resolution should you agree to?

It’s a good idea to put into place a two-step process. First, try nonbinding mediation with the assistance of an impartial mediator. Bringing in a neutral third party whose goal is to help you resolve your dispute frequently makes problems go away quickly at minimal cost. Many Internet entrepreneurs use online mediation. This is particularly helpful when the purchaser and seller of an Internet company are located in different states or countries.

If mediation doesn’t work, the second step is typically binding arbitration. To reduce costs, most Internet business owners prefer to use a single arbitrator as the private judge of their dispute instead of a panel of arbitrators.

Who serves as mediators and arbitrators? What rules apply? That’s for you to decide and put into your ecommerce agreements before the dispute arises. That way everyone is on the same page of the process to be used.

Are there issues that shouldn’t be resolved by alternative dispute resolution?

Yes. In the sale of an Internet business, two common carve-outs from using ADR are intellectual property infringement and non-compete disputes. When these situations arise after a sale, the buyer of the Internet company will often want to head straight to court to get an order to stop the alleged infringement or improper competition by the seller.

Should you include alternative dispute resolution in an agreement if you don’t trust the other party?

That’s kind of a trick question. If you don’t trust the other party, that’s a sign to walk away from the deal. If the other party is dishonest or unreliable, the contents of the legal documents probably won’t benefit you much except for damage control. Better for purchase or sell an Internet business when you’re confident the other party will live up to their obligations.

5 Ways To Resolve Internet Business Disputes Without Going To Court

By Internet Lawyer

internet business disputes resolutionIn many cases, Internet business disputes can be resolved in a short period of time without filing a lawsuit. This includes both business-to-business (B2B) and business-to-consumer (B2C) conflicts.

Here are five things you can do to make your ecommerce life easier.

1. Put your ecommerce conflict resolution policy in writing.

Ideally you’ll want your written agreements for products and services to include provisions that clearly state how disputes will be handled if there’s a disagreement. That way everyone is on the same page for handling problems before they occur.

Related Article: 7 Keys To Picking The Right Internet Lawyer For Your Business

If you don’t set up a roadmap ahead of time, chances are you’ll get sued by an unhappy party with a very happy lawyer collecting fees for going after you.

At the first sign the other party might be considering a lawsuit, if you don’t already have an agreement in place for dispute resolution as part of a binding contract, reach out and see if everyone can agree to alternative dispute resolution rather than rushing to the courthouse.

2. Try informal dispute resolution first.

In this era of emails and text messaging, a lot can get lost in translation. This can lead to miscommunication, misunderstanding, and the destruction of an otherwise healthy business relationship.

Commit that you’ll try to talk things out informally face-to-face, by telephone, or videoconferencing (Microsoft Skype, Apple FaceTime, Google Hangouts etc.) if there’s a problem. You’ll be amazed at how many ecommerce problems simply disappear by this method.

3. Mediation is a good second step for Internet conflict resolution.

If you can’t come to a solution by dealing directly with the other party 1-on-1, bring in a qualified mediator to help you solve your problem. There are experienced mediators who can meet face-to-face or provide online mediation via telephone, Skype, etc.

Related Article: Does Your Business Lawyer Draft Contracts That Encourage Dispute Resolution Or Lawsuits?

4. If mediation doesn’t work, try binding private arbitration instead.

Having a neutral party arbitrate your dispute and render a decision is a lot like having a judge do it in court. The primary advantages of arbitration over lawsuits are cost, speed, the ability to select the decision-maker, and improving your chances of keeping your dispute confidential.

5. Cut your losses in Internet business disputes and walk away.

If the choice is between (a) an expensive lawsuit that will take years, and (b) chalking up a loss as a life lesson by walking away, consider what’s really best for you and your company.

If you’ve been wronged, rarely will you achieve true justice in court even if you technically win. And even a “win” can often be appealed by the side that loses, racking up more time and expense for everyone.

If the return on the investment of your time, energy and money justifies pursuing a lawsuit to resolve one of your Internet business disputes, go for it. However, carefully weigh your conflict resolution options before telling a trial lawyer “I want to sue someone.”

How To Find An Internet Lawyer

By Internet Lawyer
find internet lawyer

Find an Internet lawyer

Are you looking for an Internet lawyer?

The term “Internet lawyer” can mean many things. Before looking for an Internet attorney, you may want to consider what type of legal help you need from one.

For example, do you need a legal professional to sue someone, to defend you in a lawsuit, to represent your online business, or to help you protect your intellectual property?

What does an Internet lawyer do?

An Internet lawyer often focuses on a few niches in cyber law. These include:

  • Internet business transactions (contracts, joint ventures, buying and selling web businesses)
  • Website legal protection (website privacy policies, membership agreements, etc.)
  • Defamation, spam, and privacy lawsuits
  • Intellectual property protection (copyrights, service marks, trademarks, and patents)
  • Alternative dispute resolution (mediation and arbitration)

When comparing Internet lawyers, you’ll want to know which of these niches you’ll need help with the most so you can make an informed decision as to who can best represent you.

Business Attorney or Internet Lawyer

Very few business attorneys understand Internet law. This means that you’re paying them to learn about it when you hire them to handle a legal matter.

On the other hand, many Internet attorneys represent businesses both in their online and offline activities. When you retain a Web lawyer who focuses on e-commerce, there’s a good chance he can handle many of your business legal needs as part of the representation.

Advantages of Hiring an eCommerce Attorney

Unless you’re involved with a lawsuit, your Internet lawyer probably doesn’t even need to meet you in person in order to represent you. This saves you time and money.

Instead, you will communicate with each other mostly by e-mail, telephone, and sometimes using a service like Skype.

This means you can get an Internet attorney who practices law in a different city than where you live. In fact, there may not even be an Internet law firm in your hometown because the field is so specialized.

Most other types of attorneys insist on meeting you face-to-face. This means you drive to an office, try to find parking, and pay for a meeting that could have taken a lot less time if you had simply talked with each other by phone.

How To Hire A Web Attorney

Once you have decided on the type of legal work you need done by an Internet lawyer, check out the websites of several Internet law firms to get a feel for what type of work they do and whether or not they really understand the Internet.

Pick one that’s a good match and schedule a confidential initial Legal Strategy Session with that Internet lawyer. Unless you like to waste time and money, it makes sense for that first meeting with the Web lawyer to be held by telephone instead of at an office.

Independent Contractor Agreements: Should You Use Them In Your Internet Business?

By Business Contracts, Business Lawyer

independent contractor agreements

Let’s make one thing clear…

Never Use Independent Contractor Agreements to Hide Employees

Independent contractor agreements should not be used in your Internet business to disguise an employer-employee relationship. However, like an employment agreement, it’s an important legal tool you’ll use to handle your labor needs.

If you get caught treating an actual employee as an independent contractor, you could be held liable for payroll taxes and some nasty penalties. There’s also the potential to deal with unemployment and worker’s compensation claims with an unhappy state government involved because you haven’t been paying the related employer contributions to those systems.

Related Article: How To Use An Independent Contractor Agreement

In other words, it’s simply not worth the risk.

When to Use Independent Contractor Agreements

If there truly is an independent contractor relationship, such as a work-for-hire web design gig for a single site, you’ll want a signed written independent contractor agreement in place to protect your legal rights.

Although the terms of the contract will vary depending upon the type of work to be performed and the unique circumstances surrounding the relationship, there are some general provisions that most of these types of agreements have in them in order to be binding (legally enforceable) in a way that offers you protection.

Related Article: Non-Compete Agreement And Independent Contractors

These terms include:

  • Scope of work
  • Price (amount and time(s) of payment)
  • Expense allocation (including any reimbursements)
  • Deadline for completion
  • Milestones (often tied to payment)
  • Existence of an independent contractor relationship rather than employment
  • Ownership of intellectual property rights for work created and protection of trade secrets
  • Governing law and jurisdiction
  • Alternative dispute resolution provisions

How to Get Independent Contractor Agreements

Of course, an experienced Internet lawyer can draft customized independent contractor provisions that are designed to protect your interests while keeping you out of court in case of  a dispute. If you’d like to talk with Business Contracts Lawyer Mike Young about getting an independent contractor agreement, be sure to set up a telephone consultation.