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Website Attorney: Group Think – Why Some Gurus Break Internet Laws

By Internet Lawyer

website attorney group thinkIf you want to know why some Internet info product marketers break the law and think they can get away with it, take a look at the Eight Symptoms of Group Think. As a Website attorney,  believe these 8 symptoms cover most situations.

1. Illusion of Invulnerability. The marketers take unnecessary risks because they’ve never been caught by the government or sued. Combined with the ego stroking of having cult-type followers, there’s a sense that nothing can touch them even when they break Internet laws.

2. Collective Rationalization. Anyone who warns against misconduct is discredited by the Internet marketers and their followers. The attacks are personal and designed to distract from what actually occurred.

3. Illusion of Morality. Morality is based on whether a launch is profitable to the product’s creator and the affiliates. Something is “wrong” only when a launch flops.

4. Excessive Stereotyping. Anyone who doesn’t believe that “money = morality” is stereotyped as unsuccessful, jealous, or a loser regardless of the underlying facts.

5. Pressure for Conformity. Those who don’t go along with deceptive and fraudulent Internet marketing tactics are considered traitors. Pressure is applied by blacklisting or threats of blacklisting. Commonly this takes the form of refusing to do business with those who rock the boat or encouraging those with large e-mail lists not to promote as an affiliate.

6. Self-Censorship. Fear of blacklisting causes some Internet gurus to keep quiet when they see others engaging in unethical or illegal online marketing practices.

7. Illusion of Unanimity. Because no one publicly dissents, some large Internet marketers that promote for each other assume that everyone agrees with hidden continuity, deceptive billing, false earnings claims, and other illegal Internet marketing practices.

8. Mindguards. The big Internet kahunas serve as the filter for the lesser gurus for information as to how things should work pre-launch, launch, and post-launch. As if handing down the 10 Commandments in stone, these gurus define what’s acceptable in online marketing regardless of legality.

The dangers of group think are exposing cracks in the foundation of Internet marketing cliques as Congress, the FTC, and various law enforcement agencies are beginning to take a dim view of Internet scams that hurt consumers, particularly those involving health or biz opp. If you’re practicing group think in your online business (your Website attorney can help you with feedback), re-evaluate the long-term prospects for your ventures. If you can’t do business legally and ethically, chances are you won’t be around in five years. Whether it is the government or a lawsuit, karma has a way of taking down those who score big at the expense of others.

To your success!

-Mike the Website attorney

Worldwide Internet Consulting: Franchise Scam

By Internet Lawyer

Ian del Carmen is selling territorial franchises for Worldwide Internet Consulting. Nothing says “proven business model” like pitching a get-rich-quick scheme (make $500 an hour!) that teaches you the supersecret concept of building websites for local businesses and charging them for it. With only 133  million search results on Google for “web design,” who wouldn’t want to pay $697 (plus $97 annually after the first year) to buy a franchise.

Here’s the website’s registration info.

Domain name:

Registrant Contact:
   Fireball Planet Corporation
   Fireball Planet Corporation ()

   G/f Feron Bldg 9590 Kamagong cor Bagtican sts
   San Antonio Village
   Makati City, Metro Manila 1203

Can we presume that Ian del Carmen is operating out of the Philippines only because the weather was too hot to operate the scam out of Nigeria?

The website doesn’t mention the term “franchise.” Instead, we get code for it like “we’re only accepting one partner per territory.” However, the e-mails pitching the business flopportunity include phrases like “Just grab your franchise here” and “see the details of this franchising offer.”

For credibility, the sales pitch notes that Microsoft, Google, and Amazon have territorial managers too. Comparing a scam “franchise” to salaried employment at three of the largest online companies? That’s ridiculous.

Of course, you do get ready-to-print business cards that state you’re a “Certified Marketing Consultant.” Oh really? Why not “Certified Dupe” instead?

Now let’s look at the particular legal aspects of this franchise scam.

  • The biz flop is being sold in county-size territories within the United States. However, potential franchisees are not being supplied with Uniform Franchise Offering Circulars (UFOCs) as required by federal and some state laws.
  • There does not appear to be any attempt to qualify to do business in each state where franchises are being sold.
  • Utilizing the term “partner” in the sales pitch suggests that equity may be sold as part of the deal. If so, there appears to be no effort to comply with U.S. federal and state securities laws.

Don’t think that I’m just picking on poor Mr. del Carmen and his flopportunity. There is at least one U.S.-based Internet marketer (social media guru) treading on thin ice with something similar. If that marketer doesn’t clean up his act, I’ll be posting about his scam too.

If you’ve been deceived into buying an illegal franchise in the United States, here’s what to do.

1. Demand a full refund.

2. Contact the U.S. Federal Trade Commission.

3. Contact your state’s Attorney General’s office.

4. If you still want blood, hire a good trial lawyer to destroy the con artists who duped you.

05/16/09 – Someone hacked and destroyed this post. It was restored but comments were lost. Because this post was targeted, comments will be closed indefinitely. Not rewarding bad behavior.

Wolverine: Pirates Steal X-Men Origins Movie Online Before Its Public Release

By Internet Lawyer

wolverine - fair use for commentaryHugh Jackman’s X-Men Origins: Wolverine has leaked out onto the Web. Downloads via P2P are estimated to already be in the hundreds of thousands. The Hollywood blockbuster release model is becoming increasingly irrelevant because technology has moved beyond it.

The FBI is investigating the unauthorized distribution of the film and the studio claims that it is forensically marked so that it will be easier to identify who leaked it. That being said, what’s occurring now is damage control.

The PR spin is that the lack of certain CGI and sound effects will make the pirated version less attractive to the general public. The studio will insist that those who have watched the leaked movie will want to pay to see the final version in theaters. That’s wishful thinking. There will be lost ticket sales.

Is there a solution? As long as there is a market demand for pirated movies, books, songs, etc., blockbuster new content (like Harry Potter Book 7) will always be prone to leaking no matter the criminal and civil penalties faced by those who leak or download. The MPAA can lobby for stricter copyright infringement penalties but it will be of little consequence.

I predict that blockbuster “star” movies will decline in number because of the return on investment is too unpredictable with piracy plus there are more choices for online and offline entertainment. To hedge their bets, studios will produce smaller budget films with no-name actors (or strictly animation as CGI costs decrease). Promotional tie-ins through product placement will partially cover production costs…and to the extent star actors are involved, they’ll be asked to shoulder more of the risk of piracy through taking a greater portion of their compensation based on the box office rather than a nice up front flat fee.