Dealing with Online Legal Risks

Publishing your own content on the Internet sometimes seems like a daunting endeavor, especially when you read press accounts of this blogger or that website getting sued over what they publish online. The hard fact is that there are a number of legal risks involved in online publishing. Nevertheless, proactive measures exist that can help you minimize these risks and/or make them manageable. This section addresses the following four topics:

Managing Your Site and Reducing Your Legal Risks

As a website or blog operator, there are some basic steps to consider that will reduce your legal risks. One is creating terms of use/service and a privacy policy for your site or blog, which will help you structure your relationship with your users and let them know what your practices are regarding personal information.

The second is taking steps to bring your site within the "safe-harbor" provisions of the Digital Millennium Copyright Act, which can help you avoid liability for linking to other sites containing copyright infringing material and for hosting copyright infringing material posted by your users.

Creating Effective Terms of Use and Privacy Policies

There are two key documents or statements that all websites should post before (or at least soon after) going "live" on the Internet. First, your site's terms of use govern your relationship with users, allowing you to set boundaries of acceptable on-site behavior and potentially limiting your liability. Second, you should create a privacy policy, which informs your users of your practices relating to private information and helps you avoid liability under a complex array of federal and state privacy laws. The following sections address these two important documents in greater detail and provide examples that you can follow in creating your own terms of use and privacy policy.

See one of the sections listed below for more information: 

Privacy Policy

A privacy policy is a statement placed in an easily visible place on a website informing users about how the website deals with users' personal information. Privacy policies generally explain whether and how users' information will be shared with third parties, including parent companies or subsidiaries. It frequently explains whether and how the website uses cookies.

Why Is It a Good Idea to Have a Privacy Policy?

Privacy policies let people know what you will do with information that they provide when registering with your website, as well as information that gets logged while they browse. A privacy policy allows users to find out what you do with their private information and enables them to adapt their conduct accordingly. Beyond that, a privacy policy will help you avoid liability under a complex array of state and federal laws dealing with users' private information.

What Should You Include in a Privacy Policy?

A well-crafted privacy policy should include the following items (although the particular items included may depend upon the nature of your website):

  • a statement explaining what kind of information you collect about your users, how you use it, and with whom (if anyone) you intend to share it;
  • a statement disclosing whether and how you use cookies and/or other tracking software;
  • a statement reminding users that data is collected through a server access log when a user browses, reads, or downloads information from the site;
  • a statement reminding users that the website operators may have to disclose user information in response to warrants, subpoenas, or other valid legal process;
  • a description of the process through which users can request changes to any of the personally identifying information collected and/or stored (you can provide an email address for notifying the website operator of changes);
  • an opt-out procedure for users to request that their information not be shared with third parties, or that their contact information not be used to send unsolicited correspondence (again, this can be done with an email address);
  • a description of the process through which the website operator will notify users of changes to the privacy policy;
  • a statement identifying the effective date of the policy.

Another important aspect of a privacy policy is what it says about minors. If your site targets or knowingly collects information from children under age thirteen, it must comply with the Children’s Online Privacy Protection Act. For more information about how to comply with the Children's Online Privacy Protection Act, please see COPPA.org's compliance page. If you do not plan to collect information from minors, you should consider adding a statement to your privacy policy saying:

This website's content is intended for adults and we will not knowingly collect personal information from children under 13 years of age. If you are a parent or legal guardian of a child under age 13 who you believe has submitted personal information to this site, please contact us immediately.

There are also rules about collecting medical information and information about criminal records. Unless it is important to the purpose of your website, you should not gather this type of information. If you plan to gather this type of information, you should consult a lawyer about your data collection strategy.

You can find good examples of privacy policies on the following sites: MinnPost.com, HuffingtonPost.com, Ars Technica, and CMLP.

What Should You Avoid?

It is common to see the following statement in website privacy policies: "[Name of website] will not collect any personal information about you except when you specifically and knowingly provide such information." While this kind of statement may sound reassuring for your users, it is not true in most cases. When a user visits a website, he or she provides personal information to the website operator simply by virtue of browsing, reading, and downloading material. This information includes IP address, user configuration settings, and what website referred the user to the site, among other things. It is better to tell users that this type of information is being collected automatically on standard web server access logs.

Terms of Use

Terms of use (or "terms of service" or "terms and conditions") generally are a statement placed on an easily visible place on a website that governs the relationship between the site and its users or visitors. Users explicitly agree to the terms when they sign up for an account and, depending on how you write the terms, visitors may implicitly agree to them when they use the site.

The terms generally consist of a number of paragraphs describing what you expect from your users and what they can expect from your website. Among other things, terms of use identify what users may post onto or use from your site. They also specify what your obligations are, and what you can do in terms of editing, removing, and changing material. For an example, see the CMLP's Terms of Use.

Why Is It a Good Idea to Have Terms of Use?

Terms of use help you put your users on notice of what you consider to be an acceptable use of your site and what you do not. They enable you to reserve the right to deny access to users who engage in objectionable conduct and to remove content that you find offensive or that may subject you to liability from third parties. It also gives you an opportunity to put language up on your website that may help protect you in the event of a lawsuit.

Terms of use are especially important if your website gives out accounts because they help specify the mechanics of how the account system will work. But keep in mind that terms of use can also apply to visitors merely browsing the website or posting comments (assuming you allow comments without an account, which many do not).

Terms of use are also useful in dealing with user-generated content. When a user creates a comment (or any other original expression) and posts it to your website, the user owns the copyright to that comment. Absent an agreement or license (see the Allowing Others to Use Your Work section for details), you could be held liable for copyright infringement for editing or changing the comment. By posting terms of use on your website, however, you can specify (and make clear to users) that you will have a license to edit, change, and remove all content posted to the website. These provisions in the terms of use give you effective control of user-generated content on your site, even if users own the copyright to that content.

What Should You Include in Terms of Use?

As discussed above, terms of use should set out the ground rules for your site. Here are some key items you should consider including in your terms:

  • terms about creating and accessing accounts;
  • a disclaimer of affiliation and/or responsibility for material posted or linked to the website;
  • guidelines for acceptable user-generated content, such as:
Content may not be illegal, obscene, defamatory, threatening, infringing of intellectual property rights, invasive of privacy or otherwise injurious or objectionable.
  • a provision conditioning the posting of user-generated content on the grant of a license to the website to use and alter the content of the posting, such as:
By posting or contributing content using these Services, you are granting [name of your website] a non-exclusive, royalty-free, perpetual, and worldwide license to use your content in connection with the operation of the Services, including, without limitation, the license rights to copy, distribute, transmit, publicly display, publicly perform, reproduce, edit, translate and reformat your content, and/or to incorporate it into a collective work.
  • a provision or provisions reserving your right to terminate or restrict access to a user's account, and to delete any content posted through it;
  • a provision prohibiting the impersonation of another person (the point here is to stop a user from misleading others about their identity, not necessarily to prohibit anonymous or pseudonymous speech);
  • provisions relating to inter-user relations, such as clauses prohibiting on-site and offline harassment; and

You can find good examples of terms of use on the following sites: MinnPost.com; iBrattleboro.com; Google; and CMLP.

Finding Insurance

Even frivolous lawsuits dismissed at a relatively early stage of the litigation can be expensive to defend, and the cost skyrockets the longer the litigation continues, particularly if judgment is rendered against you. While most lawsuits never get to trial, if you lack the money to carry out a vigorous defense, the only option available to you may be to settle (perhaps even to take down the allegedly offending content or even your entire site) regardless of the merits of your defense.

For these reasons, it is important to assess whether your online activities are covered by your existing homeowners or renters insurance. If your activities are not covered, it might be worth getting media liability insurance, even if such policies initially appear to be prohibitively expensive. Alternatively, if your online activities are part of an existing business, you may be able to add coverage to your business insurance policy through an add-on rider. Consult your insurance agent for costs and details.

Here are a list of steps to take when evaluating your insurance coverage needs:

  1. Carefully review your existing insurance policies to see if claims related to your online activities are covered (e.g., claims for libel, invasion of privacy, copyright infringement). Review the section on Homeowners and Renters Insurance Coverage in this guide for help in making this determination.

  2. If your current insurance policies don't cover you, consider switching to another carrier that will provide coverage. See the section on Evaluating Homeowners and Renters Insurance Policies for guidance.

  3. Consider whether your state's law excludes coverage for your specific activities.  This is especially important if you make any money from your online activities. See the section on Insurance Exclusions for Business Pursuits for information.

  4. If your state excludes coverage for business pursuits and you make sufficient money from your site to be excluded, carefully weigh whether the income you receive is worth the loss in coverage.

  5. Consider whether media liability insurance might be a better option (for many, it may be prohibitively expensive, but the coverage can be quite comprehensive). See the section on Media Liability Insurance for help.

Homeowners and Renters Insurance Coverage

If you have homeowners or renters insurance, your policy may cover some of your online activities. Most such policies cover damages and legal fees incurred in suits against the insured for "bodily injury," and "bodily injury" is often defined as including personal injury arising out of defamation or invasion of privacy. Obviously, you are only covered if your insurance contract contains this or similar language and your first plan of action should be to read your policy, paying close attention both to the body of the policy and any separate definition sections.

You should note, however, that your policy may not include coverage for copyright or other intellectual property claims, which do not typically fall within the standard definition of "bodily injury" or "personal injury" covered by most policies.

Homeowners and renters insurance policies generally cover both compensatory damages and legal defense costs, but not punitive damages (damages awarded above and beyond the amount necessary to compensate the plaintiff for his or her injury). This is important because plaintiffs often seek punitive damages in defamation suits, and the fear of large punitive damages might prove an insurmountable inducement to settle or remove content. On the other hand, actual verdicts (as opposed to settlements) for plaintiffs are fairly rare in these types of suits and even rarer in the case of punitive damages.

Possible Coverage Exclusions

Most homeowners policies exclude coverage for "business pursuits." How "business pursuits" is interpreted varies from state to state. (See the Insurance Exclusions for Business Pursuits section of this guide for more information.) In most states, your activities may be excluded from coverage if you earn advertising income from your site or blog or you collect money through other online means (say, through a PayPal "Donations Accepted" link on your site). If you are worried about losing coverage because you make a small amount of money from your site or blog, you may want to consider forgoing the advertising revenues and donations.

In a few states, you might still be covered even if you make money if your online activities are not your "primary" occupation. In other states, you will need to show that your online activities are no more than a "hobby," even if you made some money from it. Note, however, that there may be adverse tax consequences from characterizing your business as a "hobby." You should consult a tax adviser before characterizing for tax purposes any income you make from your online activities.

If your existing homeowners or renters insurance policy does not cover your online activities, you may want to consider switching carriers or purchasing additional coverage through an umbrella policy. See the section on Evaluating Homeowners and Renters Insurance Policies for a discussion of the terms and coverage of several large carriers.

If you are interested in further reading on this topic, Eugene Volokh published an excellent post on the Volokh Conspiracy.

Evaluating Homeowners and Renters Insurance Policies

Homeowners insurance policies (and renters insurance policies) typically provide some personal liability coverage that may cover claims brought against you arising from your online activities. As a general rule, however, the more you expose yourself to potential claims, the more you should consider coverage beyond your homeowners policy. This is especially true if your online activities even arguably constitute a business.

In general, homeowners insurance policies do not refer specifically to claims arising from online activities, but this does not rule out the possibility of coverage for such claims. When evaluating policies, you should pay particular attention to two factors: (1) the types of potential claims covered by the policy, and (2) the scope of the policy's business activity exclusion.

To help you consider these factors, we have reviewed five policies:

Want to help us create a more comprehensive review? We are hoping to collect homeowners and renters insurance policies from every carrier and every state. Please contact us if you would be willing to send us a copy of your policy (with any personal information redacted, of course).

Legal Claims Potentially Covered by Homeowners and Renters Insurance

In the course of your online activities, you may be sued for defamation, invasion of privacy, or intentional infliction of emotional distress. These claims may be covered by your insurance policy if it includes coverage for personal injury claims. Personal injury coverage is not dependent on physical injury, and commonly includes (among other things) claims for defamation (including libel and slander), "humiliation," and invasion of privacy. For more information about defamation, privacy, and intentional infliction of emotional distress claims, see the Risks Associated with Publication section of this guide.

Of the five policies we reviewed, only the Erie and Chubb policies cover personal injury claims. The Chubb policy also includes "shock", "mental anguish", and "mental injury" under its definition of personal injury.

You may also be sued for copyright or trademark infringement in the course of publishing your work online. These claims, as well as other Intellectual Property claims, do not appear to fall within most homeowners insurance policy definitions, and it is therefore unlikely that your homeowners insurance will cover you if you are sued for copyright or trademark infringement. For more information about copyright and trademark, see the Intellectual Property section of this guide.

None of the policies we reviewed provide coverage for injury that the insured "intends" or "expects." Additionally, none of the policies covers punitive damages. This may be particularly relevant to claims involving defamation, where plaintiffs generally seek punitive damages.

  • Bodily Injuries and Property Damage

All five homeowners insurance policies we reviewed cover claims involving bodily injury as well as property damage.

In general, bodily injury is defined as "bodily harm," "sickness," or "disease." The Erie policy also includes "mental anguish" in its definition of bodily injury. Additionally, each policy states that coverage for bodily harm extends only to situations where the injury results from an "occurrence," which is defined as "an accident."

Given these constraints, if your policy is limited to coverage of bodily injury claims, you will likely not be covered for claims against you that arise from your online activities.

Business Pursuits Exclusion

All five policies we reviewed exclude coverage for claims arising out of the insured's business activity. There are differences in the ways that state laws treat this exclusion, as well as important variations in the policies themselves. We discuss the different state approaches in the Insurance Exclusions for Business Pursuits section of this guide.

In order to understand the business activity exclusion in the five policies, we looked at: (1) its definition of "business" and (2) the scope of its exclusion.

1. Definition of "Business"

Although the Chubb policy states that it does not cover damages arising from the insured's "business pursuits" it does not define what a "business pursuit" is. The Erie policy defines "business" as "any full-time, part-time or occasional activity engaged in as a trade, profession or occupation." The Amica Mutual, OneBeacon, and Providence Mutual policies contain identical definitions: "A trade, profession or occupation engaged in on a full-time, part-time or occasional basis . . . or [a]ny other activity engaged in for money or other compensation."

The Amica Mutual, OneBeacon, and Providence Mutual policies further state that an "activity engaged in for money or other compensation" will not be characterized as business (and therefore will not be excluded from coverage) if:

(1) the insured received $2,000 or less in the year prior to the start of the policy, or (2) the insured engaged in a volunteer activity, and only received payment of expenses incurred in the performance of the volunteer work.
2. The Scope of the Business Pursuits Exclusion

The five policies that we reviewed vary a great deal in how narrowly they apply the business pursuits exception:

  • Chubb's coverage is the most favorable to the insured, as it does not exclude "incidental business at home" in which the insured has no employees and has gross revenues of $5,000 or less in any one year.

  • Erie's coverage is also somewhat favorable, covering "activities normally considered non-business" as well as all "occasional business activities." Whether blogging, for example, is "normally considered a non-business" activity is an open question.

  • Amica Mutual and Providence Mutual exclude virtually all liability "arising out of or in connection with a business" unless the participant is under 21 years old, self-employed, employs no other employees, and works either on a part-time or occasional basis. This exception to the exclusion primarily applies to jobs like baby-sitting and newspaper delivery.

  • OneBeacon's policy excludes coverage for all liability "arising out of or in connection with a business."

Increasing Your Insurance Coverage

If it seems likely that your online activities will fall under the business pursuits exclusion of your policy, you should consider purchasing Media Liability Insurance.

Otherwise, given the limitations of basic bodily injury coverage, if you engage in substantial online activity you should look for a policy that includes personal injury coverage. Such a policy will likely be more expensive, but the coverage for injuries like defamation may be well worth the additional cost should someone bring such a claim against you.

A more comprehensive alternative is to purchase an umbrella policy as recommended by the (not impartial) Insurance Information Institute, which states that such coverage typically begins in the range of $150-$300 annually. The primary effect of umbrella policies, which do cover personal as well as bodily injury, is to increase your coverage cap. Given the high cost of legal services, this may be worthwhile even if your policy already covers personal injury. Some umbrella policies also augment your coverage in other ways. The OneBeacon umbrella policy we reviewed, for example, eliminates the punitive damages exclusion; this might be crucial if you are sued for defamation, for which punitive damages are often sought.

Insurance Exclusions for Business Pursuits

Most homeowners insurance policies exclude coverage for liability relating to "business pursuits." Although the exact formulation varies by state, the courts generally define a "business pursuit" as a continual or recurrent activity carried out for financial gain. In most states, courts give a broad interpretation to "business pursuits," drawing in almost any activity that results in financial gain. In these states, if you devote a non-trivial amount of time to your online publishing activities and make any money from them -- for example, through advertisements or a tip jar -- then you probably are carrying on a "business pursuit," and your coverage could be lost. Conversely, if you don't make any money from your online publishing activities (or more precisely, if financial gain is not your motivation), then you probably are not engaging in a "business pursuit," and you won't lose coverage under your homeowners insurance. As Eugene Volokh notes, "if you're worried about the risk of libel lawsuits, you might want to consider staying entirely noncommercial." (emphasis in original).

In other states, the courts have interpreted "business pursuits" in a narrower fashion. There, you might be able to argue that your online publishing activities are not business pursuits so long as they are not your primary occupation or making a profit is not your primary motive. In these states, going commercial does not necessarily carry the same risk of losing coverage under your homeowners insurance.

Most homeowners policies do not have a separate provision stating what law will be used to interpret them, so courts ordinarily will apply the law of your place of residence.

Choose from the list below to view state-specific information on the "business pursuits" exclusion in the fifteen most populous U.S. states and the District of Columbia. Keep in mind that there is no case law directly addressing the definition of a "business pursuit" in the online publishing context, so there is substantial uncertainty surrounding this area of law.

Business Pursuits Exclusion in California

California law defines a business pursuit "as a regular activity engaged in for the purpose of earning a profit." Smyth v. USAA Property and Casualty Insurance Co., 152 Cal. App. 3d 864, 869 (1984). CMLP has identified no California cases interpreting this test in the context of online publishing out of the home (or elsewhere). As a general matter, however, California cases have established that an activity need not be full-time or a primary (or even major) source of income in order to qualify as a business pursuit.

Therefore, if you live in California, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Florida

Florida law defines a business pursuit as "a continuous and comprehensive activity for financial gain." State Farm Fire & Cas. Co. v. Friend, 478 So.2d 1198, 1200 (Fla. App. 1985). CMLP has identified no Florida cases interpreting this test in the context of online publishing out of the home (or elsewhere). The Friend case (above) suggests that a short-term, part-time activity carried out for money may not be considered a business pursuit when the primary motive of the activity is not financial gain (in that case, the insured person was helping out a friend).

Therefore, if you live in Florida, you may have an argument that your online publishing activities are not a "business pursuit" if your primary motivation is not financial gain. This argument might be undercut, however, if your publishing is more than a part-time, short-term activity.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Georgia

Georgia law defines a "business pursuit" as "a usual commercial or mercantile activity customarily engaged in as a means of livelihood and typically involving some independence of judgment and power of decision." Brown v. Peninsular Fire Ins. Co. 320 S.E.2d 208, 209 (Ga. App. 1984). CMLP has identified no Georgia cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, Georgia courts have excluded from the category of business pursuits activities that are not the insured's primary occupation, even if engaged in for profit. See for example Brown (above) and Southern Guaranty Insurance Co. v. Duncan, 206 S.E.2d 672 (Ga. App. 1974). Other courts have indicated that an activity will not be considered a business pursuit if the primary motivation is not financial gain. See for example Nationwide Mutual Fire Insurance Co. v. Collins, 222 S.E.2d 828 (Ga. App. 1975).

Therefore, if you live in Georgia, you have a good argument that your online publishing activities are not a business pursuit if you carry them out in your spare time or your primary motivation is not financial gain, even if you make money from those activities.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Illinois

Illinois law defines a "business pursuit" as a "continuous or regular activity, done for the purpose of earning a profit." State Farm Fire & Casualty Company v. Moore, 430 N.E.2d 641 (Ill. App. 1981). CMLP has identified no Illinois cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, Illinois courts deem even part-time and supplemental activities done for profit to be business pursuits. On the other hand, Illinois courts have determined that profit-making activities that are temporary or sporadic, or that result in compensation only irregularly, are not business pursuits. See for example the Moore case above.

Therefore, if you live in Illinois, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Indiana

Indiana law defines as business pursuit as "a continued or regular activity for the purpose of earning a livelihood." Mid-American Fire & Casualty Co. v. Shoneys, 843 N.E.2d 548 (Ind. App. 2006). CMLP has identified no Indiana cases interpreting this test in the context of online publishing out of the home (or elsewhere).

One Indiana court has held that the a for-profit activity is not a business pursuit if it does not occur continually or regularly, or if making a profit is not the primary motivation. See American Family Mutual Insurance Co. v. Bentley, 352 N.E.2d 860 (Ind. App. 1976). In that case, the insured rented storage space in his home to a third party for money, but there was no evidence that he did so regularly, or that profit was his primary motivation. In other cases, however, Indiana courts have held that an activity is a business pursuit even if the activity is not the insured's primary occupation. See for example the Shoneys case above.

Therefore, if you live in Indiana, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Massachusetts

Massachusetts law defines "business pursuits" as incorporating "two significant elements: profit motive and continuity." Nationwide Mut. Ins. Co. v. Bent, 1999 WL 1203774 (Mass. Super. Nov. 9, 1999). CMLP has identified no Massachusetts cases interpreting this test in the context of online publishing out of the home (or elsewhere). One Massachusetts court has indicated in reasoning not essential to its judgment that the category of business pursuits embraces “[a]ny full or part time activity of any kind engaged in for economic gain." Metro. Prop. & Cas. Ins. v. Fitchburg, 793 N.E.2d 1252 (Mass. App. Ct. 2003).

Therefore, if you live in Massachusetts, you may be in danger of losing coverage for your online publishing activities if you make any money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic. The law in Massachusetts is not clear on this point, however.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Michigan

Michigan law defines "business pursuits" as follows:

To constitute a business pursuit, there must be two elements: first, continuity, and secondly, the profit motive; as to the first, there must be a customary engagement or a stated occupation; and, as to the latter, there must be shown to be such activity as a means of livelihood, gainful employment, means of earning a living, procuring subsistence or profit, commercial transactions or engagements.

Riverside Ins. Co. v. Kolonich, 329 N.W.2d 528, 530 (Mich. App. 1982). CMLP has identified no Indiana cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, Michigan law excludes from the category of business pursuits activities engaged in as a hobby, when financial gain is only a side consideration. For instance, in the Kolonich case (above), a Michigan appellate court reversed a lower court ruling because the insured person's activities -- teaching ceramic classes in her home, firing ceramics pieces, and selling the occasional piece -- could constitute a hobby rather than an enterprise conducted for profit.

Therefore, if you live in Michigan, you may have an argument that your online publishing activities are not a "business pursuit" if you carry them out as a hobby and your primary motivation is not financial gain, even if you make some money from those activities. Additionally, you might be able to argue that your publishing activities are not sufficiently continuous to constitute a business pursuit, if you engage in them sporadically and they are not part of your "customary engagement" or "stated occupation."

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in New Jersey

New Jersey law defines a "business pursuit" as an activity involving "continuity" or "customary engagement" and a "profit motive." Prudential Prop. & Cas. Ins. Co. v. Boylan, 704 A.2d 597, 602 (N.J. Super. 1998). CMLP has identified no New Jersey cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, however, the New Jersey courts include nearly all profit-making activities carried out on a regular basis in the category of business pursuits. The activity does not need to be the insured person's sole occupation or means of support, but it must be more than merely sporadic or occasional.

Therefore, if you live in New Jersey, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in New York

New York law defines a "business pursuit" as an activity regularly engaged in with a view toward earning a livelihood or making a profit. In other words, to constitute a business pursuit, there must be two elements: "first, continuity, and secondly, the profit motive." Showler v. Am. Mfrs. Mut. Ins. Co., 261 A.D.2d 896, 897 (N.Y App. Div. 1999). CMLP has identified no New York cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, however, the New York courts include nearly all profit-making activities carried out on a regular basis in the category of business pursuits. The activity does not need to be the insured's sole occupation or means of support, but it must be more than merely sporadic or occasional.

Therefore, if you live in New York, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in North Carolina

North Carolina law defines the word "business" in "business pursuit" as "an individual's paramount means of earning a livelihood." North Carolina Farm Bureau Mut. Ins. Co. v Briley, 491 S.E.2d 656, 659 (N.C. App. 1997). CMLP has identified no New York cases interpreting this test in the context of online publishing out of the home (or elsewhere). As a general matter, however, North Carolina courts have declined to include part-time work under the exclusion, at least where the insured also had a separate full-time job.

Therefore, if you live in North Carolina, then you may have a good argument that your online publishing activities are not a business pursuit so long as they do not constitute your primary occupation or source of income.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Ohio

Ohio law defines a business pursuit as work "engaged in regularly" which "produce[s] an income." Watkins v. Brown, 646 N.E.2d 485, 488 (Ohio App. 1994). CMLP has identified no Ohio cases interpreting this test in the context of online publishing out of the home (or elsewhere). As a general matter, however, Ohio courts have deemed activities to be business pursuits even when profit was not the primary motive and the amount of money earned was small.

Therefore, if you live in Ohio, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Pennsylvania

 
Pennsylvania law defines a "business pursuit" as including two elements: (1) continuity; and (2) a profit motive. Old Guard Mut. Ins. Co. v. Quigley, 1990 WL 255912, at *3 (Pa. Ct. Comm. Pl. Jan. 31, 1990). CMLP has identified no Pennsylvania cases interpreting this test in the context of online publishing out of the home (or elsewhere). As a general matter, Pennsylvania courts have excluded from the category of business pursuits activities the primary motivation for which was not financial gain.

Therefore, if you live in Pennsylvania, then you may have an argument that your online publishing activities do not constitute a business pursuit if your primary motivation is not financial gain, even if you make some money from those activities.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Texas

Texas law defines a "business pursuit" as incorporating two elements: "(1) continuity or regularity of the activity, and (2) a profit motive, usually as a means of livelihood, gainful employment, earning a living, procuring subsistence or financial gain, a commercial transaction or engagement." Allstate Ins. Co. v. Hallman, 159 S.W.3d 640, 644 (Tex. 2005). CMLP has identified no Texas cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, however, Texas courts recognize that "hobbies" are distinct from business pursuits. One court has defined a hobby as "a specialized pursuit, such as stamp collecting, painting, or gardening, that is outside of a person's regular occupation, usually done in a non-professional way as a means of relaxation during leisure time." United Servs. Auto. Assoc. v. Pennington, 810 S.W.2d 777, 779 (Tex. App. 1991). In that case, the insured, a car salesman, bought a horse in order to experiment with new race training methods. The court held that the jury was entitled to view this as a hobby and not a business pursuit, even though the insured admitted that he would have liked to turn the activity into a business in the future.

Therefore, if you live in Texas, you have a good argument that your online publishing activities are not a business pursuit, so long as you can characterize them as a hobby. It will help if your primary motivation for publishing online is not financial gain, and you have other employment.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in the District of Columbia

CMLP has identified no District of Columbia cases interpreting the "business pursuits" exclusion. If you know of a case on this topic, please contact us.

Business Pursuits Exclusion in Virginia

Virginia law defines a "business pursuit" as follows:

To constitute a business pursuit, there must be two elements: first, continuity, and, secondly, the profit motive; as to the first, there must be a customary engagement or a stated occupation; and, as to the latter, there must be shown to be such activity as a means of livelihood, gainful employment, means of earning a living, procuring subsistence or profit, commercial transactions or engagements.

Virginia Mut. Ins. Co. v. Hagy, 352 S.E.2d 316, 318 (Va. 1987). CMLP has identified no Virginia cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, the Virginia Supreme Court has given a rather broad interpretation to the category of business pursuits. In Hagy (above), the court ruled that an insured person who performed childcare in her home was engaged in a business pursuit as a matter of law, even though she testified that, after experiencing a downturn in her business, her motivation for doing so was "love for the child rather than the prospect of financial gain." The court noted that the childcare operation bore all the outward signs of a business for profit and found that even a small amount of income was sufficient to provide evidence of a "profit motive."

Therefore, if you live in Virginia, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.

Business Pursuits Exclusion in Washington

Washington law defines a "business pursuit" as an activity that is (1) conducted on a regular and continuous basis; and (2) profit-motivated. Stuart v. Am. States Ins. Co., 953 P.2d 462, 465 (Wa. 1998). CMLP has identified no Washington cases interpreting this test in the context of online publishing out of the home (or elsewhere).

As a general matter, however, Washington courts give this test a broad interpretation. In order to be deemed a business pursuit, an activity does not need to be one's sole source of income and does not need to be full-time, nor does the activity need to be motivated solely by profit. "Some" profit motivation is sufficient to make an activity a business pursuit, so long as it is conducted on a regular and continuous basis. See, e.g., Stoughton v. Mutual of Enumclaw, 810 P.2d 80 (Wash. App. 1991).

Therefore, if you live in Washington, you may be in danger of losing coverage for your online publishing activities if you intend to make a profit from your website or blog, such as through advertisements or a tip jar, unless your activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall trend.

Media Liability Insurance

If your online activities are not covered under your current insurance policies, a growing number of companies are offering media liability insurance. While these policies are expensive -- perhaps prohibitively so for a newly formed business -- they can also be quite comprehensive. They typically cover costs to defend against suits brought for:

  • libel, slander and defamation.
  • invasion of privacy (a growing concern, as suits arising from newsgathering activities are not hampered by the First Amendment concerns that make libel and slander suits difficult to win).
  • copyright infringement and other intellectual property-related suits.
  • damages resulting from errors, omissions, misstatements or misleading statements made by you.

Media liability policies typically have a minimum coverage of $1 million and can run all the way up to $100 million for large publishers. The premiums may be as low as $1,500 a month, but typically begin at $2,500. Media liability insurance is a growing business with more companies underwriting policies every year, so it makes sense to shop around. Some carriers that provide policies in this area include: American International Group, Chubb Group, Media/Professional Insurance, First Media Specialists, ACE USA,OneBeacon Insurance Group, and AXIS Capital U.S. Insurance. Keep in mind that you will likely have to go through a licensed agent or broker to secure coverage from these companies.

There are several things to consider when shopping for a media liability policy:

  • International Coverage: Increasingly, traditional and non-traditional journalists are finding themselves sued abroad in jurisdictions more favorable to plaintiffs than the United States. If you are likely to touch on foreign issues or discuss foreign citizens in any way, you might want to ensure that your policy covers you for suits brought overseas.
  • Settlement: Many insurance policies include "hammer" clauses, which specify that the insurer, rather than you, gets to decide whether to accept a settlement (at the penalty of losing or drastically reducing coverage if you don't acquiesce). Because insurers are worried about their economic bottom line rather than your reputation (or good journalism, for that matter), you and your insurance company may not agree on when is a good time to settle a lawsuit. Insurance companies sometimes include clauses giving them a say in whether or not you will print a retraction (something that can limit liability or damages in many states -- please see the Overview of Retractions section of this guide for more information).
  • Punitive Damages: Some policies cover punitive damages and some do not. While actual awards of punitive damages against citizen journalists are likely to be relatively rare, this coverage may provide you with peace of mind and also enable you to fight rather than settle suits you believe are meritless.
  • Coverage Period: Some policies cover you for any claim filed against you during the policy period; others, for any claim brought against you for an incident that occurred during the policy period. The latter gives you more insurance should you discontinue your site, terminate your policy, and subsequently find yourself embroiled in a lawsuit.
  • Policy Limits: All policies will pay attorney's fees, but some deduct defense costs from policy limits and some do not. Because such fees can be significant, this may make a large difference in the actual coverage of your policy.
  • Counsel: Some policies allow you to select your own lawyer, while others do not.
  • Financial Security: It is important to make sure your policy is underwritten by a company that is financially secure.
  • Lawyer's Opinion: Some insurers require that you hire a lawyer to assess your chances of being sued and write an opinion letter to the insurer before it will underwrite a policy. The costs of this can be quite substantial.

Finding Legal Help

If you are faced with a situation that needs legal attention, you basically have two options: handle the matter yourself or seek professional legal help.

Representing yourself in a legal proceeding may hold some initial appeal due to the cost of hiring a lawyer or your interest in taking control of the situation. Before you decide to handle a legal matter yourself, however, review the section on Representing Yourself to assess whether you are ready to handle the matter and whether you have access to the resources you will need to succeed.

If you are considering handling the matter yourself, be forewarned that a seemingly simple issue can quickly grow complex. In most situations you will be better off hiring a lawyer, who will assess the merits of your case, explain your options, and help you achieve the best result.

If you decide to seek professional legal help, you can hire a lawyer directly or, depending on your situation, request legal assistance from a nonprofit legal assistance organization such as Legal Aid or the Citizen Media Law Project. See the sections on Hiring a Lawyer or Nonprofit Legal Assistance for more information.

Representing Yourself

Assessing Your Situation

It's not easy to decide whether to represent yourself. Before you make a decision, take some time to consider whether your personality, work ethic, and lifestyle are suited for the task ahead. The following questions should help you assess your situation:

  • Do you have the time to learn the substantive and procedural aspects of the laws involved?
  • Is your case relatively straightforward?
One way to make this determination is to attend a free legal clinic in your area. Call the clerk's office of your local court and ask if there are free legal clinics or a Volunteer Lawyer for a Day program. If there is one, attend it and discuss your case with the lawyer present. You should come away understanding more about the complexity of your case and whether or not you feel able to represent yourself.
  • Do you feel comfortable negotiating with the opposing party (or the lawyer representing the opposing party)
  • Can you clearly express yourself in writing and remain emotionally detached from the legal process?
  • Are you organized in your record-keeping?
  • If your case involves going to court, are you willing to:
  • speak in public?
  • understand the legal aspects of your case well enough to explain it to a judge?
  • meet deadlines?
  • perform legal research and understand court rules, cases, and statutes?
  • produce documents to file in court?
  • take the time and effort to understand and respond promptly to papers issued by the court?
  • respond to papers received from the opposing party?
  • free up time in your schedule to attend court hearings?

What it Means to Represent Yourself in a Legal Proceeding

If you are involved in litigation and decide to represent yourself, you will be referred to as a pro se litigant. While a court will hold you to the same standards as a lawyer, most courts will be less stringent with mistakes made by pro se litigants, and might even have a staff attorney at the courthouse to guide you through some of the procedural requirements. However, not all courts are helpful and can in fact be hostile to pro se litigants. Keep in mind that should you come to a point during the legal proceedings where you would prefer to be represented by a lawyer, you may have the option to do so.

Where to Find Help

In addition to the clerk's office mentioned above, there are several nonprofit institutions and other organizations that may be able to help with your case and provide guidance and resources. In extremely rare cases, they may even offer to represent you in court.

Other good resources include legal form books. Form books contain legal forms that lawyers use in drafting a legal document. Legal forms come in templates with suggested language and must be tailored to fit the situation. There are many types of legal forms available, categorized by subject, procedure, court, or state. Bear in mind that the forms are not meant to be used as boilerplate language. You will need to perform additional research to make sure that the form is appropriate to the situation and complies with current law. Here are some sites that have legal forms:

You can also visit your local law library (at a law school or courthouse) to find legal form books.

Additionally Nolo.com is another wonderful legal resource. Nolo publishes print, software, and online manuals covering a wide variety of legal issues, including materials on taxes, employment, intellectual property, and how to operate a small business. The publications are written for the layperson and are terrific do-it-yourself legal guides.

Hiring a Lawyer

Like doctors and other professionals, lawyers range from general practitioners to specialists. Typically, lawyers who offer general legal services concentrate on legal issues concerning the general public—for example, wills or real estate transactions. However, if you are seeking a lawyer because of legal problem associated with your online activities, you should look for a specialist who focuses on media law or intellectual property issues on the Internet. If you want to set up a business, you should find a lawyer with experience in corporate and tax matters.

Finding the right lawyer

There are several ways to find a lawyer:

  • Personal Recommendations
The best way to find a good lawyer is by word-of-mouth. Ask your family, friends, or colleagues for recommendations. If you previously hired a lawyer for another situation, ask her for references in the field you need. Don't stop at getting names and contact information; press the referrer for reasons why he thinks the lawyer is good.
  • Bar Associations and Other Organizations
Your state or county bar association will likely have a referral service that matches your legal problem with an appropriate lawyer. Visit the American Bar Association's Consumer Guide to Legal Help to find bar associations in your state. Additionally, other types of organizations are focused around a specialty rather than geography. For example, the Media Law Resource Center provides a list of their law firm members who specialize in media law, including First Amendment and intellectual property law. (Organizations that might provide legal representation without a fee are covered under the Nonprofit Legal Assistance section of this guide.)
  • Advertisements and the Yellow Pages
You may come across advertisements for a lawyer's services through tv, radio, magazines, newspapers, websites, or phonebooks. Remember that the advertisement has little to do with the lawyer's abilities. You should thoroughly research the lawyer by following the steps outlined below.
  • Your Insurance Company
If someone has brought a lawsuit against you, check with your insurance company to see if you have liability insurance for the situation at hand. If you do, your insurance company should provide you with the necessary legal defense and indemnify you if any money needs to be paid to the other party. In this case, you will be represented by the lawyer from the insurance company and will not need to seek a lawyer of your own.

Once you have a list of lawyers, research them as much as possible. The lawyer's education background and the firm that the lawyer is associated with may be an indication of the quality of a lawyer's practice, but the best indicator of a lawyer's service is experience. Additionally, check your list of lawyers against a legal directory, a resource that contains peer ratings of lawyers, to see the opinions of others in the legal community. Martindale Hubbell is a highly regarded legal directory and is available online.

Initial Meeting With a Lawyer

Once you're comfortable with your list, call each lawyer to set up an initial meeting. Apart from the where's and when's of the meeting, you should make sure to find out:
  • approximately how long the meeting will take
  • what documents you should bring
  • whether the lawyer charges for an initial meeting (and if so, the amount and method of payment)
  • whether the lawyer can provide you with a list of references from current or former clients
You should prepare so that the meeting stays focused, allowing you to gauge the lawyer's response to your situation.
  • Gather all documents pertaining to the situation in a file. This includes printouts of any relevant emails and webpages. Additionally, note dates and times you received each document.
  • Write down everything you know about the situation, including:
  • the nature of the actions that triggered the situation
  • when and how you received any documents about the situation
  • any relevant interactions you’ve had with anyone involved in the matter
The act of writing the summary allows you to: record events you may forget during the conversation; better understand your position; and focus your conversation with your prospective lawyer. If there is a lawsuit, you may be required to disclose this summary to the other side, so keep to the facts and do not include your opinions.
  • Prepare a list of questions. The lawyer will ask you a lot of questions to help her evaluate the strengths of your case; you should do the same to evaluate the lawyer. Alexander Hawes, LLP has a terrific approach to identifying the information you need, as does the Monroe County Bar Association.

Understanding Legal Fees

The lawyer should go over her fee arrangement during your initial meeting. Bills may run high and you must understand the various fee structures to avoid unpleasant surprises.

There are several ways you may be billed for a lawyer's services:

  • Hourly fee: The most common fee structure, an hourly fee is a person's hourly rate times the hours spent working on your case. Hourly rates will probably vary from lawyer to lawyer within a law firm, and from lawyer to non-lawyer. If money is an issue, ask whether a junior lawyer can work on the case while a senior lawyer reviews the final product. Make sure to get a breakdown of the hourly rates for each person who will work on your case, and an estimate on the length of time each person will spend on your case. The amount of work put into a case varies and it's impossible to project a definitive amount; however, a good lawyer should be able to give you a ballpark figure based on her prior experience.
  • Retainer Fee: A retainer is an advance payment, or down payment, to be applied towards the hourly fees earned later. (Note: in some cases, a retainer fee also refers to the amount paid to an attorney on a regular basis to keep the attorney available for handling legal services.)
  • Fixed fee: A fixed fee is a flat amount that covers a specific legal service. For example, if you need help starting your business, a lawyer may charge you a fixed fee for helping you to incorporate.
  • Contingency fee: In a contingency fee arrangement, the lawyer only gets paid if she is successful in getting you an award of damages, whether through trial or settlement. A lawyer's portion of the award is usually a fixed percentage of the total amount, depending upon the type of case involved.
  • Mixed Fee: A mixed fee arrangement combines contingency and hourly fees.
  • Costs: Fees go to the lawyer for her work, while costs cover the payments incidental to those services. For example, if you've hired a lawyer to help you incorporate your business, one cost will be the filing fee for the articles of incorporation. For purposes of a lawsuit, talk to the lawyer about advances for the costs associated with litigation.

The First Meeting

Plan to arrive 5 minutes early so that you can be ready as soon as the meeting starts. Bring your summary and file of documents. As you explain the situation be candid. Remember, the lawyer needs all of the information, good and bad, to assess your case and give you a useful road map of what lies ahead. Except in rare cases, lawyers are bound by professional rules to keep the initial meeting confidential, so you should not feel constrained. You should already know how long the meeting will last, so keep an eye on the time and make sure the lawyer addresses all of your questions.

Post-Meeting

After you've met with a few lawyers, compare how they approached your situation and think about whose counsel you valued the most. If you met with a lawyer who was personally recommended to you, don't be surprised if you don't like her as much as the recommender did. There are many different styles of lawyering, and you may not be as comfortable with some as you are with others.

If there are one or two lawyers with whom you connected, call their references and speak to former clients. Once you're comfortable making the decision to hire a lawyer, make sure you have a written fee agreement to avoid billing surprises.

Lastly, don't lose touch with your case just because you have hired a lawyer. Your lawyer works for you. You need to set the goals, and your lawyer will use her legal expertise to help you achieve them. The only way for you to make decisions about your case is to stay informed.

Nonprofit Legal Assistance

Many lawyers and legal organizations provide pro bono work. In common usage pro bono refers to volunteer work done for the public good. In the legal field, lawyers who do pro bono work take cases for those who are disadvantaged and unable to secure legal assistance. Additionally, legal advocacy organizations (organizations that take on cases) usually provide pro bono representation for their clients.

There are a number of nonprofit institutions and other organizations that may be able to represent you or provide other legal assistance. Should the organization offer to represent you in court, you will be in the enviable position of enjoying free legal work done by lawyers passionately committed to the underlying causes of your situation. Note that these lawyers may be working on your individual case because they want to break new legal ground or advance the law in a particular way to benefit society as a whole. Thus, you will want to make your individual goals clear to them. More often than not, they will share your goals and you'll be able to forge ahead.

See the Nonprofit Legal Assistance Organizations by State section for organizations in your state that may be of help. On a national level, here are some organizations whose work may be of interest (listed alphabetically):

Nonprofit Legal Assistance Organizations by State

 

Choose your state from the list below for more information about nonprofit legal assistance organizations in your state.

 

Nonprofit Legal Assistance Organizations in Georgia

The following organizations provide legal assistance to individuals and organizations in Georgia:

 

Nonprofit Legal Assistance Organizations in Indiana

The following organizations provide legal assistance to individuals and organizations in Indiana:

Nonprofit Legal Assistance Organizations in Michigan

The following organizations provide legal assistance to individuals and organizations in Michigan:

 

Nonprofit Legal Assistance Organizations in New Jersey

The following organizations provide legal assistance to individuals and organizations in New Jersey:

 

Nonprofit Legal Assistance Organizations in the District of Columbia

The following organizations provide legal assistance to individuals and organizations in the District of Columbia:

 

Nonprofit Legal Assistance Organizations in Virginia

The following organizations provide legal assistance to individuals and organizations in Virginia: