5 Common Legal Errors in Internet and Social Media Marketing

"Kyle-Beth Hilfer"

Kyle-Beth Hilfer

[tweetmeme]I have met a surprising number of experienced business people who do not budget for legal advice. Here are five common legal mistakes in Internet and social media marketing that can result in financial penalties and business interruption.

1. COPYRIGHT MISTAKE: Photographs on Google Images are not free for the taking. Regardless of whether a photograph bears a copyright or watermark symbol, it is not in the public domain. Someone holds the copyright. It may even be a famous organization like Getty Images. If you use these images, you may receive a cease and desist letter and a claim for financial damages. Always take photographs from stock photo houses or buy rights directly from the photographer. Read the licenses to be sure you understand your rights.

2. TRADEMARK MISTAKE: Trademark infringement is not based on precise copying. The test for trademark infringement is likelihood of confusion in the marketplace. This means altering one word of a slogan may not ward off a trademark infringement claim if you market in similar trade channels with similar goods. Take the time to create original trademarks.

3. DATA COLLECTION MISTAKE: If you are collecting any consumer data on your website, in social media, or on mobile devices, you should publicize a privacy policy that explains to consumers where that data goes, how it is shared, and how it is protected. An astounding number of website owners do not protect themselves properly with updated Terms of Use and Privacy Policies. Many who have those policies do not update them annually. Review these policies annually with legal counsel to see if they still align with current business practices.

4. PRIZE PROMOTION MISTAKE: If you are running a sweepstakes or contest, do not copy rules from another promotion you find on the Internet. Every promotion has its own details that require careful crafting of rules. Each of the 50 states has complex statutes governing prize promotions. There are a variety of contrasting requirements on such issues as rule requirements, disclosures in advertising, prize delivery, and registration and bonding. Using social media platforms for public voting can render the promotion an illegal lottery if not implemented properly. Prize promotions require close legal vetting.

5. MOBILE MARKETING MISTAKE: An astounding number of marketing companies are trying to break into the fast growing area of mobile marketing. They rely on third party lists of mobile phone numbers, and they have not done proper due diligence. They do not understand the legal requirements of obtaining consumer opt-in before commencing a mobile campaign. Enforcement of federal statutes in this area as well as state attorneys-general investigations are on the rise. The financial ramifications of a failure to obtain a proper opt-in can be staggering. Consult with your legal counsel about the proper way to obtain the opt-in before commencing a mobile campaign.


This post first appeared on the author’s blog. © Kyle-Beth Hilfer, P.C. 2011.  Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP, a full service intellectual property law firm. For more information about her law practice and more blog posts, visit www.kbhilferlaw.com.


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  1. Thanks for these eye-openers.All look easy enough to avoid.

    Of particular interest, the Prize Promotion Mistake. It makes me want to avoid the whole thing. Or, do a Google search so I can find the rules for my state. I’m not certain, but I believe I could even go to my state’s website and find those guidelines. Glad I’m not thinking about a promotion any time soon though.

  2. Patricia, thank you for your comment. On Prize Promotion, no need to avoid prize promotions. Companies have been running these for years successfully. There is a learning curve in doing them. I have been practicing law in this area for over 20 years and have guided many clients, small and large, through running a prize promotion. I guide clients regularly on the scope of their promotion in accordance with their budget and business goals. All it requires is a willingness to do your due diligence with qualified counsel who can walk you through the steps. After you’ve done a few, things start to fall into place unless you are adding new technology platforms or new layers of the promotion. You can also consult the Promotion Marketing Association or DIrect Marketing Association websites for advice. If you are in the mobile space, the Mobile Marketing Association has some basic information as well. None of these websites will walk you through the intricacies of 50 states’ laws, but they provide a good understanding of the basics of promotion law. A google search will likely reveal other sources of information as well. In short, you should not be afraid of running a prize promotion, understanding like anything else, you may need to do some homework.

  3. Great information. I’ve been talking about the need for bloggers and social media users to learn the “rules of the road” for some time now, and it’s always nice to hear another voice calling for more education on this subject! Thanks for the tips, especially the reminder about the prize giveaways.

  4. Deb — Thank you for your comments. The confusion sometimes comes because people do not see water marks on the photos. This combined with the misconception that the Internet is “free” makes for a bad conclusion. Intellectual property law will continue to develop as technology develops. It just means that creators have to be more innovative about protecting their rights….Kyle-Beth Hilfer