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Chapter 20 Business and the Internet. Internet is an essential part of doing business Many issues involved PgP BUSA331 Chapter 202.

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Presentation on theme: "Chapter 20 Business and the Internet. Internet is an essential part of doing business Many issues involved PgP BUSA331 Chapter 202."— Presentation transcript:

1 Chapter 20 Business and the Internet

2 Internet is an essential part of doing business Many issues involved PgP BUSA331 Chapter 202

3 Litigation Concerns: E- Discovery Business as target of lawsuit Documents contain data-possibly incriminating evidence Documents contain metadata-additional pertinent data-authors, dates, times Litigation hold-when lawsuit is reasonably anticipated-beware evidence destruction Electronically Stored Information-broad Requesting party must describe items sought with reasonable particularity-avoid fishing expeditions PgP BUSA331 Chapter 203

4 Litigation Concerns: Corporate Securities Quiet period-limits release of information to public SEC Act 1934, Rule 10b-5, fraud or deceit-such as stock pump and dump via spam, can boost stock price by 6% JOBS-Jumpstart Our Business Startups Act (2012) No limit on who can be solicited Limit on who can buy Advertising and solicitations must be filed with SEC Crowdfunding (KickStarter) exception- <$1M in 12 months, individual limit of 10% or $100K PgP BUSA331 Chapter 204

5 Litigation Concerns: Corporate Securities Regulation FD-Fair Disclosure Prohibit issuer from disclosing material nonpublic information Netflix CEO release of information on social network site probably not an appropriate venue for announcements of nonpublic information unless investors notified in advance PgP BUSA331 Chapter 205

6 Litigation Concerns: Cybergripers Web provides anyone a soapbox to criticize a firm Possible concerns- Defamation Trademark Copyright infringement SLAPP suits (next) Firms must weigh possible negative publicity before initiating suit PgP BUSA331 Chapter 206

7 Litigation Concerns: SLAPP Strategic Lawsuit Against Public Participation Lawsuit lacking merit to stop citizen from exercising political right or punishing them Elements of SLAPP Speech is basis of claim No true legal merit to claim being made by plaintiff ‘John Doe’ defendant Plaintiff tries to discover ‘John Doe’s’ identity Result is free speech is chilled California is at forefront, can award defendant attorney fees, 27 states have such laws (2010) PgP BUSA331 Chapter 207

8 Litigation Concerns: Interference Tortious Interference with Business Relationships Elements- Existing contract or business relationship Defendant’s knowledge of relationship Intentional interference Defendant causes harm Financial damages Cases-interfering with spamming, framing, griping PgP BUSA331 Chapter 208

9 Interstate Commerce and the Internet Borderless nature makes it difficult for states to enforce let alone justify restraints on Interstate Commerce Protectionist laws-shipping wine Cigarettes PgP BUSA331 Chapter 209

10 ICC-Sales Tax Supreme Court allows businesses to avoid collecting sales tax in states where they do not have a ‘physical presence’ Borders owed CA tax for online sales due to owning physical retail stores although was a separate division Online agents or affiliates? Amazon, Overstock- NY, IL and other states Congress may decide, or Streamlined Sales Tax Agreement among states PgP BUSA331 Chapter 2010

11 Privacy Concerns-Policy At issue-personal information-control, accuracy, handling Privacy policy should outline collection and use, review periodically PgP BUSA331 Chapter 2011

12 Privacy Concerns-Data Breach Personal information is valuable What is reasonable security? At issue-identity theft, humiliation Data breach cyber insurance Encrypt data PgP BUSA331 Chapter 2012

13 Employer Concerns-Job Applicants Much information available concerning job applicants online Employers demanded applicants provide social network login information Facebook states this is violation of terms of service Many states enact law prohibiting this practice, many more considering PgP BUSA331 Chapter 2013

14 Employer Concerns-Employee Bloggers Does employee have 1 st Amendment free speech right to criticize employer? PgP BUSA331 Chapter 2014

15 Employer Concerns-Employee Bloggers-Friendster Friendster developer fired for blogging negative comments on prior web site performance Outraged members cancel membership, post 4630 comments Friendster can fire, but must suffer consequences PgP BUSA331 Chapter 2015

16 Employer Concerns-Employee Bloggers-Firings Microsoft contract employee blogging on Microsoft purchase of Apple computers Delta fires attendant for suggestive pin ups in flight attendant uniform Google employee of 11 days fired for musings on Google CIA contractor fired for blogging about interrogation methods At-will (non-union mainly) can be fired for blogging on own computer on own time PgP BUSA331 Chapter 2016

17 Employer Concerns-Lifestyle Privacy Work life and private life sometimes overlap Employees are entitled to reasonable expectation of privacy in off-work hours Employees with high profile public personas have a diminished expectation of privacy Employees of organizations promoting certain code of ethics should not violate these, even outside of work PgP BUSA331 Chapter 2017


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