My business idea involves creating a localized website such as dentists in Los Angeles. I would then spend a lot of time on SEO (search engine optimization) and pay per click advertising to bring traffic to the site. I would then generate leads for dentists that are looking for appointments. They would pay me per lead. I would be selling this persons information to the dentist for the dentists office to follow up on. Is there a legal way to do this? How many legal issues would I be facing?
While specifics of your particular business plan do matter, I don't see anything that would prevent you from starting and running the type of business you describe, and decrease your legal and financial risk to an acceptable level. And in fact, I have previously represented and/or am currently representing a number of start-up companies whose businesses are analogous to yours.
That said, as Counselor Wigell rightly notes, there are a great many issues (both legal and business) to be addressed in founding any new venture. A non-exhaustive list would include:
(1) creation of a separate business entity such as a corporation or LLC (highly recommended, especially if you have personal asset you wish to segregate and protect from the new venture's activities) through which to conduct the business, and to serve as a platform for any subsequent financings;
(2) a form of independent contractor agreement for use with your website developer(s), assuming of course that they will not be actual EMPLOYEES of the business;
(4) good advice regarding what those risks (some of which you will have considered, many of which you perhaps have not) are likely to be, and ways to eliminate or at least minimize them.
I would be happy to discuss this with you further. Contact information is on my AVVO profile, and I reproduce it below.
Terry L. Thomas
My colleagues have done a good job of summarizing the most important legal issues you will need to address (none of which should preclude operating your intended business).
My concern is commercial, rather than legal: Given the number of companies already doing, or trying to do, the same thing, what will make your business sufficiently unique to have a reasonable chance of succeeding?
A startup business requires a great deal of thought and preparation. Any business plan must include and is not limited to issues of legal structure, administration, startup and capitalization costs, marketing and advertising, public relations, competition analysis, accounting, etc.
An Internet business has all those issues and is compounded by the nature of the environment in which it will operate.
Only an experienced Internet savy business lawyer should be consulted to help you with your idea. Good luck in your endeavor.
Attorneys tailored for startups and technology firms.
David N. Sharifi, Esq.
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LA TECH & MEDIA LAW
Intellectual Property | Entertainment Law | New Media
8052 Melrose Avenue
Los Angeles, CA 90046
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Do a marketing survey to determine what dentists are willing to pay for a lead. Take a sample of at least 30 dentists. Then determine whether or not you plan will be feasible. If the pay per click costs $5 and the dentist is only willing to pay $5 what does that leave you? Bear in mind, not all leads will show up so that factor needs to be considered. In addition, all pay-for-clicks will not call.
The legal issues are primarily contractual in nature. There are many contractual terms to consider. Meet with an attorney to determine how you wish to structure your deals.
Are You Planning on Opening a New E-Commerce Website?
There is much you need to know as you begin your new business.
Below is a checklist for legal issues I use for new e-commerce clients.
1. Busines entity - Are you going to be a C corp, an LLC or a sole proprietorship?
2. Terms of Service - This is your contract with your visitors and is the most important item for any e-commerce site. A little work here brings big dividends in the future.
4. FTC guidlines - The FTC has been regulating business advertising for almost a century. All of their advertising guidlines apply to e-commerce sites.
5. Domain Name issues? Is your name available. Can you create a Trademark?
6. Trademark - Do you have a brand name free from conflict? Should you start with just common law rights? Should you register the mark, and when?
7. Copyright - If it is on the web, it already belongs to somebody. Did you buy a license for the images you are using? Do you have a DMCA notice on your web site?
8. Do you need a DMCA policy?
9. Web Site security issues?
10. Do you need and have an EIN? You can get that for free.
11. Do you have employees? - If so you need written policies regarding their authority and use of the internet.
12. Do you know the difference between a "browser wrap" and a "click wrap" and which do you need?
When I discuss this list with clients other issues arise. Finally, I always discuss with my clients their need for good accounting services. An accountant's advice as you start up can save you many dollars in tax that you might not save if you wait to speak to an accountant until your first tax return is due.
I hope this list will give you pause to think about those issues for which you might need to seek professional advice.
Please feel free to contact me concerning your issues, we can chat about your plans and what steps you need to take. This would be a No Charge Consultation.
Andrew M. Jaffe
Attorney at Law
Practice Limited to E-Commerce and Internet Law
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