This post is a guest post by Nan Gibbons
Running a business is complicated and becomes even more as the company grows. It becomes increasingly important that those in charge establish rules and set precedents in potentially troubling or complex areas, especially regarding legal matters. It doesn’t matter if a business operates domestically, internationally or both; there need to be safeguards in place to avoid unnecessary and costly litigation. Having a reliable legal team is valuable not only for getting a company out of tough legal situations, but in helping ensure it doesn’t get into them in the first place. Every policy should be run by the company’s attorneys to make sure it is consistent and viable. Some areas that should be considered are usage rights, contracts and social media. Each area leads to companies spending millions of dollars on legal action every year because of a lack of prevention.
Check Usage Rights
Many individuals and companies seem to be unaware of the seriousness of copyright and trademark infringement. Others don’t seem to care and blatantly steal intellectual property. Regardless of intent the results are the same: legal trouble. It should be a part of company policy to verify copyright/trademark status on any media a company wishes to use and to only make use of it after permission has been sought from the owner. Doing so shows good faith on the part of the company and, if used properly, can bolster the reputation of independent artists whose work is used. Further, treating designers with respect can open doors to further business relationships, helping a company find and retain valuable creative assets.
Have a Solid Contract
Drafting a clear, well-defined business contract is a major step toward preventing troubling litigation between two parties, particularly if the relationship crosses national borders. Both companies should know the other’s terms and conditions of service, giving them basic knowledge of each other’s business practices and allowing them to define and clarify further terms. International disputes, especially, can be hard to resolve, so best practices dictate that the issue of choice of law, essentially defining which nation’s laws the contract and any disputes fall under, be settled in the initial contract. To avoid costly and image-damaging courtroom battles, companies can agree to submit potential quarrels to international arbitration, which will ensure a balanced process with a legally binding ruling.
Define Social Media Practices
Social media is here to stay. With hundreds of millions of people using services like Facebook, Twitter, LinkedIn and running blogs, it’s an inevitability that every company will have employees who actively engage in social media. Rather than discourage social media usage, businesses should provide basic instruction on proper usage. Employees who manage a company’s branded social networking accounts should be made aware of the tone they should use when making announcements or interacting with other users as well as any usage policies put in place by the owners of the social network. Any employee who manages their own account and discusses the business should disclose their relationship and note that their beliefs do not reflect the beliefs of their company. By ensuring that employees are not seen as the voice of the company and that the official social media accounts for the company are run consistently and avoid any usage violations, businesses can reduce the risk of being seen as untrustworthy or misleading.
When navigating the many labyrinthine passages of law, it can be easy for companies to take a reactionary stance toward litigation. It is often easier to see problems after they have arisen than it is to create contingency plans or attempt to prevent any and all problems. However, with some clearly define company policies and employee education, businesses can avoid lawsuits and many other legal worries, saving them precious time and money.