Cyber Safety

A Tangled Web

Well-designed Web sites can reach thousands of potential customers, but they can also leave your company vulnerable. "I call it `shark-infested cyberspace,' " says Nancy James, principal of N.P. James Insurance Agency in Concord, Massachusetts, and a specialist in cyberspace liability. "There's insurance to protect you, but we're talking about very expensive policies that might not protect you from every risk."

If you have a Web site, James notes, you're technically considered a publisher and are therefore liable for all the same things as a major publisher, including being sued for plagiarism, copyright infringement and libel. In addition, there are no geographic boundaries on the Web, which can lead to potential trademark risks. A business in Chicago with the same legal name as a business in Atlanta never used to worry about customers confusing the two. On the Web, however, these companies might end up suing one another.

How can you protect yourself? James recommends that in addition to beefing up your liability insurance, you should invest in a few hours of legal advice before opening your online storefront. And don't put up your Web site without including a rock-solid disclaimer. Want to learn from a company that can afford the very best in insurance and legal protection? Check out Microsoft's online disclaimer at

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This article was originally published in the April 1999 print edition of Entrepreneur with the headline: Cyber Safety.

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