Hi,

I have 2 relatively large clients. They are both direct competitors with each other.

I knew they were feuding for some time, then I get a call from one of them to say that he is going to sue the other company for "passing off" with their brand (they have similar brands and the new brand of the competitor looks very similar).

Now I've developed both sites and I've put up the logos on both their websites... and I receive a solicitor/lawyer's letter in the post and via email today saying that I must take down the website of the other party because they are in breach of copyright and trademark infringement.

I ring the client in question and he says that they aren't and it's not my problem - I am only the host and they can't sue me.

Ummmm..... I don't want to get into any legal disputes so I'm currently organising the domain to be hosted elsewhere at a larger host. Anyone have any input/ideas? Can I get sued for hosting a website that is infringing another website's copyright/trademark?

Cheers,

PS: One of their points in the letter is "time is of the essence" so... yeah... i'm gunna have to do something real soon.

Say good bye to both clients :)

First and foremost, you should definitely consult a lawyer. Now here's what I know:

As an ISP you are protected under the DMCA (Digital Millenium Copyright Act). You, as a web host, are sheltered from liability because you're merely a conduit and the products and website content of your clients have nothing to do with you and is something you can not continuously monitor and control. You are not responsible for making sure all the content your clients are uploading is not infringing on copyrights.

As long as you:
1. have mechanisms in place to allow your client to remove the supposedly infringing material (Yes because your clients can simply FTP in and remove the material), and
2. accomodate the copyright owner's protections via technical measures (Yes because other's cannot access their files, putting things on their website is their choice)

So you have safe harbor under the DMCA. You are not legally required to take down anything and in fact, my personal recommendation is that you do not interfere at all for now. AGAIN, consult a lawyer as soon as you can.

As a side note:
If the issue at heart is specific graphics and trademarks that you helped create for the two companies, then there may be some trouble for you. Because unless you signed a contract that some how states the websites are "works for hire" technically you are the copyright holder. But I'm gathering this is not the case.

Originally posted by xsdv
and I receive a solicitor/lawyer's letter in the post and via email today saying that I must take down the website of the other party because they are in breach of copyright and trademark infringement.

A lawyer is not a judge, and has no right to tell you to do anything. This issue is for the two parties to work out. If and when the courts find that there is in fact trademark/copyright infringement, then and only then can you be requested to take action against the other party's site. At that point, yes, you can be held liable if you don't remove the offending content from your server.

That said, I'm not an attorney, and my words here are worth exactly what you paid for them. The best thing you could do is consult with a real attorney.

-B

In the contract my clients agree to I have the right to terminate their accounts for any reason at any time.

I would prorate their accounts and refund all monies if either of them had lawyers contacting me.. provided your TOS/AUP has something similar.

Then again.. I don't respond well to threats. ;)

they developed the logos themselves.

i have a content management system running on both systems which allows them to update flyers and stuff... but the template is hardcoded and i need to change it.

I have offered my client to take down their logo free of charge.

In fact, I am thinking of putting in some code that makes their logo (header) a part of the content management system so they CAN update their logo without needing my help.

Personally I would consult a lawyer before I did anything at all...

Most likely I wouldnt do anything as far as removing or terminating anyones account until that lawsuit is settled. You cant be in breach of anything until the suit is settled...

Maybe I am mistakin, but thats why I would consult a lawyer...

Personally, I would agree with the part about contacting Lawyer and not doing anything until it goes to Trial. Odds are you'll get pulled in anyway no matter what you do. Just make sure your Lawyer includes an arrangement (counter suit) to have the losing party pay for "your" Lawyer bill, time lost in Court, and anything else you two can think of. ;)

Contact a lawyer immediately because maybe if you are violating one party's right they can sue you for any damages caused.

Definetly contact a legal authority for some advice. Make sure you have a terms of service outlined to rid you out of any liabilities.

its 11pm here but yes everyone i've talked to has convinced me to talk to my solicitor first thing tomorrow.

i'll post up the details here tomorrow afternoon.

Originally posted by xsdv
its 11pm here but yes everyone i've talked to has convinced me to talk to my solicitor first thing tomorrow.

i'll post up the details here tomorrow afternoon. Good luck...Im curious about how similar the two logos are...

xsdv, I am glad to hear you will be consulting with a solicitor, I think that is wonderful.

My other piece of advice, although very hard to follow, I understand :) will be do not freak out. There is absolutely no need to panic. :)

It is at best, a civil case, not a criminal matter. Your liability is limited no matter how it is cut, because it is these companies' property, not yours. As others have said, you are merely the conduit, you are not the goods itself. :)

I have been on all 3 sides of such cases in my business travails over the years :) and can assure you that absolutely nothing happens overnight. You have every right to take ample time to consult with a solicitor, think things through, talk with friends and associates, pray a bit :) and so on.

This is also a good opportunity to review your Terms of Service and your development contracts to make sure that you are protected from such issues moving forward. (If you have a clause in your TOS like "these terms may be changed at any time" then the new terms are live to future issues.)

Anyway, try not to freak out. Get lots of rest, eat well, keep a cool head, take things one at a time. It seems like such basic advice and probably sounds silly, but the first couple letters I received from lawyers left me gasping for breath. :blush: It's just human nature. Lawyers have impressive stationery but lawyers have little true power. They are bargainers and they have tools at their disposal to make things move and shake... but they aren't the judges. Really no action is required of you until you receive a court order.

Take care and let us know how it goes. :)

:D Bailey

Obviously, the trademark holder lawyer gonna ask you to remove it. It's his first option in the process.

I would personally wait for a legal decision before taking action.

Cheers,
Matt

This is going to be another expensive lawsuit..... Anyway, I think there are two points I am not clear about.

If you are an ISP, you are protected by some Act. But what if you are the developer who put the logo there in the first place? Do you sign an agreement with your client indicating that they should hold all the copyright , and that your job is just doing development?

Joshua

Hi.

I spoke to my lawyer this morning and he will write up letters to both parties tomorrow seeking to indemnify me of any suit and to pay for any damages.

basically it went like this:

was given notice that websites must be brought down by client A's lawyer
asked client B to either:
a) change website contents - which i will do free of charge
b) move their site onto another host
c) bring down their site at 6pm for breach of overdue account.
was threatened to be sued for damages by Client B if site is brought down

was given the ok by client B to move their site to a third party provider. rang client A's lawyer and said it will be out of my hands in a few hours. transferred their stuff onto another machine. was out the door. get a call from client B saying they have changed their mind and they will 'comply' with client A's request.

bring computer back. transfer sites back to main machine. activate site again. their new logo is emailed to me. changed their logo on client B's website.

rang client A's lawyer and told them that they decided to comply and the new logo is up and they were happy.

received a call from client B TODAY saying that i need to write down everything that happened yesterday because client B's lawyer is going to call me to ask me what happened.

I am awaiting my own lawyer to finish his golf game (yes, he's playing golf right now) so he can go back to the office and send out my letters..... which will be tomorrow.

I'm glad you sought professional legal advice and are sorting the matter out.


Originally posted by joshuayip
This is going to be another expensive lawsuit..... Anyway, I think there are two points I am not clear about.

If you are an ISP, you are protected by some Act. But what if you are the developer who put the logo there in the first place? Do you sign an agreement with your client indicating that they should hold all the copyright , and that your job is just doing development?

Joshua

As a developer, your client is responsible for making sure that you sign a service contract indicating that the materials created under the contract are "works for hire." This means that even though the developer created the material, the client will hold the copyright. If there is no contract indicating work for hire, in a legal dispute, the developer can actually claim copyright for all the materials made for the client.

Now don't quote me no this but if say client A never signed a work for hire contract with the developer. Client B sues client A for copyright infringement - then client A can actually say well we don't own the copyright, our developer made it. Then client B can sue the developer for copyright infringement.

i know what you are saying but i'm not worried about that - i'm pretty sure they wont try that since the design house is well known and their logos are everywhere its almost common knowledge who designed them - so basically i didn't make their logos. they were emailed to me.

Originally posted by xsdv
i know what you are saying but i'm not worried about that - i'm pretty sure they wont try that since the design house is well known and their logos are everywhere its almost common knowledge who designed them - so basically i didn't make their logos. they were emailed to me.

...so refresh for my why you were up to your elbows in mud, then?

If you didn't do the design and you didn't hold the copyright, it's not your problem until you're served with a binding court order.

You're not the referee and most certainly clean-up work should not be done for free.... you're just the critter getting caught under the tires of a passing disagreement....

*$.02*

:D Karin

yeah I agree with bithost(NET)

you should have charged for the change, I wasn't your problem!

it's more complicated than just getting caught inbetween.

fwiw each client is worth amost $1000 per month... and they hint at "taking their business elsewhere" when they are not happy.

If I lose both clients I am perhaps $1,500-$2,000 poorer per month... and over the course of 1 year that is around $15-20k.

Keeping both clients happy and trying to be the peacekeeper and saying "hey i won't charge you for 1 hour of my time if it means you'll stay here" is a small price to pay imo.

Originally posted by xsdv
it's more complicated than just getting caught inbetween.

fwiw each client is worth amost $1000 per month... and they hint at "taking their business elsewhere" when they are not happy.

If I lose both clients I am perhaps $1,500-$2,000 poorer per month... and over the course of 1 year that is around $15-20k.

Keeping both clients happy and trying to be the peacekeeper and saying "hey i won't charge you for 1 hour of my time if it means you'll stay here" is a small price to pay imo. so what did the lawyer say?

I have a really really hard time with threats and intimidation, and frankly I've been known to cut off my nose to spite my face when confronted by bullying.

I personally would turn both of their sites off and tell them to get lost and that's that, can't be sued over what you're not hosting, right?

And I'd probably kick myself for deleting two such large clients later. But then I'd remember how much I hate it when people try to pressure or bully me and just shrug it off and instead of spending that time trying to coddle them while they claw at each other, I'd spend that time looking for less bothersome clients to replace them with.

the lawyer was pretty calm and he downplayed everything and got me laughing (in other words he was good at making me feel at ease).

he told me this stuff happens all the time and not to worry. he will write out letters and send them to both clients requesting them to sign. It is supposed to indemnify me from any damages / whatever that may occur if there is a suit etc...

I believe it will cost me a couple of hundred bucks for him to do that, but at least I'll still have both clients and protection. Hopefully....

Originally posted by xsdv
the lawyer was pretty calm and he downplayed everything and got me laughing (in other words he was good at making me feel at ease).

he told me this stuff happens all the time and not to worry. he will write out letters and send them to both clients requesting them to sign. It is supposed to indemnify me from any damages / whatever that may occur if there is a suit etc...

I believe it will cost me a couple of hundred bucks for him to do that, but at least I'll still have both clients and protection. Hopefully.... Couple hundred dollars should be well worth it if you can keep both clients...

xsdv,

I don't think that you are liable for this type of activity. But then again as everyone else is stating... this is a legal matter and requires Lawyers to play the ball game.

I would just lay back and let things unfold but also make sure your butt is covered by making your TOS squeeky clean.

This is a matter of their business vs another business. You just happen to be in the middle of if it because you host it. You are not required to take down the web site just because a lawyer sends you an e-mail... it is a judge that can only tell you to do something.

Keep us posted on this.

If all else fails... keep a packed suitcase under your bed for a quick getaway :)

someone didn't read the thread:rolleyes:

Glad things worked out for you :)

BTW, would I have to pay a retainder fee for a Lawyer?

Originally posted by axe9
someone didn't read the thread:rolleyes:

Glad things worked out for you :)

BTW, would I have to pay a retainder fee for a Lawyer? Only if you want ready access to the lawyer in the future...For writing letters and such most just use a flat or hourly fee.

lol, missed the entire second page... my bad.