My first presentation this HostingCon was on how to deal with legal threats in your business. Of all the presentations I’ve given on similar topics, this was the most well attended. I’m not sure why, but I’m glad that hosting providers are taking an interest in preventative lawyering. There were a number of follow up questions for Jeff and me, so I thought I’d answer some of them here:
First, reviewing or revising your agreements is not as expensive as you think. It’s certainly more expensive than cut and pasting them from a competitor, but only a bit more. What you gain by a custom set of agreements are agreements that actually reflect the individual risks confronting your business.
Next, you do need to standardize how you respond to customer complaints, subpoenas, warrants and abuse issues. Some hosts outsource that function to their lawyers, some have developed very good in house systems, and some only escalate major issues to counsel. However addressing this issue on an ad hoc basis leads to missed deadlines, frustrated customers and a higher likelihood of litigation.
Finally, while lawyers are expensive, there is almost no charge in having a lawyer learn about your business. If you don’t have counsel, set up an informational meeting. Most lawyers are happy to spend half an hour of their own time learning what you do, and at least getting an idea of what risks you face on a day to day basis. Having this relationship in place will speed the time it takes for your lawyer to figure out a good resolution to a pressing legal problem and is time well spent.
About David Snead
David Snead is a lawyer whose practice is focused on internet infrastructure providers. In his eleven years in this practice, he has represented clients including multinationals, middle tier hosting companies, and two guys, a server, a T-1 and a huge MasterCard balance.
A long-time WHIR contributor, David Snead is the Web hosting business's best-known legal expert. Through his WHIR blog, he offers a credible legal perspective on both specific actions in the Web hosting business and general developments in legislation.
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