1. What Every Business Owner Needs to Know About the Legal Risks of Blogging November 17, 2009 5 oclock Seminar, NAWBO Silicon Valley Chapter By Kristie Prinz, Managing Principal The Prinz Law Office 1© 2009 The Prinz Law Office.

2. I. Risk of Copyright Dispute Controversy launched by Associated Press over Drudge Retort quotes Associated Press posted new licensing fees for excerpts of five words or more Prevailing view that Associated Press wants to launch battle over fair use Risk of becoming perfect test case 2© 2009 The Prinz Law Office.

3. II. Risk of Deceptive Business Practice Suit Federal Trade Commission has proposed guidelines which will revise 1980 Endorsement Guide FTC concerned about undisclosed conflicts of interest in blogging Push back by traditional advertising and public relations world? © 2009 The Prinz Law Office.3

4. II. Risk of Deceptive Business Practice Suit FTC targets expert endorsements –Must be supported by actual exercise of expertise in evaluating product features –Must include an examination or testing of the product as extensive as someone with expertise would normally need to conduct –If endorsement implies comparison made, must be based on expertise/ evaluation © 2009 The Prinz Law Office.4

5. II. Risk of Deceptive Business Practice Suit New rules impose burden on companies of monitoring what is being said about their products on Internet Importance of good contracts with bloggers engaged in viral marketing New oversight needed of advertising and public relations help © 2009 The Prinz Law Office.5

6. III. Risk of Defamation Liability or Vicarious Liability for Defamation Defamation can occur in blog posting or blog comment Potential shield from republication liability in Section 230 of Communications Decency Act of 1996 Barrett v. Rosenthal, 40 Cal. 4 th 33, 146 P.3d 510 (Cal. 2006) © 2009 The Prinz Law Office.6

7. IV. Risk of Trade Secret Disclosure Danger that trade secrets will be intentionally or inadvertently disclosed OGrady v. Superior Court, 139 Cal. 4 th 1423 (Cal Ct. App. 2006): trade secret disclosure case involving Apple; viewed as victory for bloggers; court protected status as journalists © 2009 The Prinz Law Office.7

8. IV. Risk of Trade Secret Disclosure Importance of education within company on what constitutes a trade secret Importance of entering confidentiality agreements with individual members of workforce, which are clear and easily understood © 2009 The Prinz Law Office.8

9. V. Risk of Employment Law Issues Risk of employment discrimination liability if harassment on blog Continental Airlines case involving female pilot; male coworkers posted statements about her in online forum Blakey v. Continental Airlines, 992 F. Supp. 734 (D. N.J. 1997) © 2009 The Prinz Law Office.9

10. VI. Risk of Conflict of Interest Risk that undisclosed conflict of interest will become basis of suit –FTC suit against Whole Foods following CEO John Mackeys statements about competitor Wild Oats © 2009 The Prinz Law Office.10

11. VII. Risk of Privacy Law Violations Classic scenario: doctor bloggers writing about patients Can arise where corporate blogger holds personal information © 2009 The Prinz Law Office.11

12. VIII. Best Practices for Managing Risks Adopt a business blogging policy –Guidelines on disclosure –Prohibition of conflicts of interest –Prohibition of anonymous blogging –Guidelines on quoting © 2009 The Prinz Law Office.12

13. VIII. Best Practices for Managing Risks Adopt a business blog policy –Explain what laws apply to blogs –Provide appropriate blogging guidelines –Require signature Insure your business against blog risks Educate business on blog law developments © 2009 The Prinz Law Office.13

14. CONTACT INFORMATION: Kristie D. Prinz, Managing Principal The Prinz Law Office P.O. Box 1594 Los Gatos, CA 95030 kprinz@prinzlawoffice.com www.prinzlawoffice.com Phone: 408.884.3577 Fax: 408.317.0316 © 2009 The Prinz Law Office.14