Monthly Archives: August 2016

The Legal Lowdown On Pokémon Go Lawsuits & Marketing Tactics

pokemon Go Lawsuits
Here Come The Pokémon Go Lawsuits (& Other Marketing Legalities to Consider)

The micropayment miracle, Pokémon Go (PoGo), currently holds the prize belt for “most popular game of all time,” and in short few months, it’s raked in over $210,000,000. Market experts expect revenues to hit $1.1 billion by year’s end, and savvy brick-and-mortar businesses are PoGo promoting — to huge success.

But, dear reader, don’t be lulled into submission! The Pokémon Go story is NOT all smiles and profits. [DUN, DUN, DUN!]

Oh yes, there’s the dark side of Pokémon Go. The side that’s spawned a PoGo disaster map; the side that’s raised get-off-my-lawn stakes to lawsuit level; the side that has people wondering, “Can I sue Pokémon or Nintendo for injuries sustained in the line of PoGo battling!?”

Is Pokémon Go ushering innocents down a dangerous personal injury path? And if so, can the game’s maker be held liable? Moreover, what legal aspects must be considered when promoting a business through PoGo?

Let’s examine this mobile gaming phenomenon, with legal scalpels.

Pokémon Go Lawsuits

Nintendo aims to “put smiles on people’s faces.” Yet, not every civilian is grinning over Pokémon Go. In fact, two households have definitely NOT caught the PoGo craze; instead…they’re filing Pokémon Go lawsuits — alleging nuisance and unfair enrichment.

Get Of My (St. Claire Shores, Michigan) Lawn

The Place: Wahby Park, St. Claire Shores, MI. A point of pride in a middle class enclave, Wahby is a public recreation area that doubles as a Pokéstop and Poke gym.

The Problem: People who live near Wahby aren’t happy. They claim Poké players are driving on private lawns, parking on public streets, tearing up gardens, and…looking at them! One resident lamented, “I don’t feel safe sitting on my porch!” Another referred to the situation as “a nightmare.” Someone else said she was “afraid to go to sleep,” and a man cursed his lack of prescience, lamenting: “If I knew [Pokémon Go] was coming, I’d have sold my place two months before it got here!”

An online anti-PoGoer warned the game was “ruining the quality of life for many Americans,” and a seemingly committed jingoist, who clearly isn’t a free market proponent, cautioned, “It’s a form of destrictive [sic] society, designed by the Chinese. And it’s a shame [Pokémon Go Players] have the power to vote, because it seems that they are easily brain washed. Which could lead this country to it’s [sic] destruction.”

Local Solutions?: Several residents near Wahby Park did seek redress with the city council — and the council did take steps to remedy the situation, like increasing signage, blocking off private roads, and increasing nightly police patrols. Apparently, however, the measures didn’t satisfy one couple who is moving forward with a Pokémon Go lawsuit.

The Lawsuit: One of the disrupted homeowners is suing Niantic, Inc., The Pokémon Company, and Nintendo Co. Ltd. for “nuisance and unjust enrichment.” Why unjust enrichment? Well, the plaintiffs feel that their lawn, being so close to a public park, has helped PoGo become a financial phenomenon. Plus, the lawsuit “seeks to stop designating GPS coordinates on or near private properties without permission.”

Local Opposition: Some Whaby Park Pokémon players are side-eyeing the plaintiffs. One young father interviewed for a local television station explained his viewpoint:

“For the majority, for the mass populous that comes here to play Pokémon, they’re here to have fun and enjoy the nature and meet cool people. We’re not trying to trespass anybody.”

Likely Outcome: Will the homeowners win? Believe it or not, they have a sliver of a shot. There’s a legal standard known as the “attractive nuisance doctrine,” which says homeowners can be held liable for a child’s death or injury if:

  • The landowner keeps something potentially dangerous on their property (i.e., broken car on lawn, trampoline, pool without fence (in some jurisdictions)).
  • The landowner knows children are around who might trespass.
  • The landowner knows that something on their property may endanger trespassing children.
  • The children are too young to recognize the risk.
  • The landowner can fix the problem at a reasonable cost.
  • The landowner does nothing.

Now, this lawsuit isn’t directly related to children harmed by Pokémon Go, but attorneys could argue that Niantic and Nintendo should have foreseen PoGo’s negative consequences. It’s a stretch, but not an impossibility.

That said, PoGo’s terms of service includes an arbitration clause that, in part, reads:

“[D]isputes between you and Niantic will be resolved by binding individual arbitration, and you are waiving your right to trial by jury or to participate as a plaintiff or class member in any purported class action or representative proceeding.”

Does that mean nobody can ever sue Niantic or Nintendo? Nope. Because also embedded in the ToS is a stipulation allowing customers to opt out of the arbitration clause, via email, within 30 days of downloading.

So, bottom line: who will likely win this Pokémon Go lawsuit? If we’re hypothetically trading Vegas odds, then sure, Niantic and Nintendo probably win this one. But you never know. At this point, we cab only be sure that the Courts and clerks are tackling the issue.

Pokémon Go Marketing: Ideas & Legal Considerations

Marketing gurus agree: If you’re a brick-and-mortar business that isn’t using PoGo to lure customers (pun intended), then you’re missing out on…well…money. As one Reddit user urged, “[Using Pokémon Go to promote] is the greatest investment you can make right now.”

So, how are business owners putting PoGo to work?

  • Bars, pubs and restaurants are becoming Poké gyms, then offering discounted drinks for members of the team that holds the gym.
  • Animal shelters are encouraging people to pick up dogs to walk while they’re out for Poké play, which has led to an increase in pet adoptions (Nice!).
  • Creating power stations for “phone refueling.”
  • Following the game and using social media to advertise when a rare Pokémon is in an establishment.

Are the promotions working? Heck yeah! As another Reddit user succinctly said, “[Pokémon promotions brought him] SO. MUCH. FOOT. TRAFFIC.”

“Put down a lure and watch the customers flow in,” advised another.

Tips To Avoid Pokémon Marketing Pitfalls

  • Account Security: Pokémon Go registration means handing over access to your entire Google account. Though Niantic does a wonderful job at keeping secure, the threat of a breach still lurks. Consider creating a new e-mail for your Pokémon Go marketing efforts in case disaster does strike.
  • Malware Concerns: Malware is starting to spread throughout the Pokéverse. Avoid risk by downloading from a reputable source.
  • Play Nice: Don’t try to sabotage a competitor’s PokéMojo. What do we mean? The app includes a Pokéstop and Poké gym removal form. So, let’s say Frank is in direct competition with Mary. They both own and operate ice cream parlors on Main Street. Being a gamer, Mary adopted Pokémon Go early and started using it to promote her business. It didn’t take long for her shop to become both a Pokéstop and a Poke gym. Frank, saw the amount of foot traffic Mary’s Poké-efforts garnered — and he didn’t like it. One day, when feeling particularly spiteful, Frank decided to sabotage Mary’s success by submitting a Pokéstop / Poké Gym removal request for Mary’s business. Frank’s actions could be considered unfair and deceptive marketing, and he could be fined — heavily — by the FTC. (And so can you, if you “pull a Frank.”)

Expect to read a lot about Pokémon Go lawsuits over the next several months. But the question remains: will the PoGo craze outlasts the lawsuits it spawns? Only time has the answer.

Kelly / Warner is a top-rated law firm that focuses on Internet, startup, and eSport law. To learn more about the firm, jump this way.

Online Review Defamation: A Client Lied About Your Business. Now What?

online review defamation
Protecting your online reputation can be as difficult as winning the Tour de France…clean. So, what can businesses do when faced with online review defamation? Let’s take a look.

  • First, ask yourself: “Is the review accurate?” This can be the hardest step. If the review is negative but true, the chances of remedying the situation with a defamation claim diminish considerably. Why? Well, under United States law, legal defamation requires falsity. Does this mean you can’t combat the negative review? No, it doesn’t. You can. (We’ll get to “the how” below.)
  • Second, ask yourself another question: “Is the review fundamentally true, but grossly exaggerated?” Hyperbole, believe it or not, rarely passes the defamation sniff test. Sometimes, but not often. In the eyes of the law, reasonable people can distinguish hyperbolic speech from a false statement of fact. For example, an online reviewer condemns: “Mr. Widget’s Widgets are the WORST widgets in the world!” Mr. Widget is peeved about the review and threatens a defamation lawsuit. But the truth is, he probably wouldn’t win an online review defamation lawsuit, because “the worst company in the world,” is an exaggerated opinion and not tantamount to libel. Does this mean you can’t combat negative reviews? Again, no. (I promise we’ll get to how below.)
  • Third, if your detractor did, indeed, make a false statement of fact in an online review, you may be able to sue for trade libel or defamation. That said, most online defamation situations rarely blossom into lawsuits. Attorney intervention usually does the trick; people often — and innocently — don’t realize they’ve crossed a legal line and just need reminding to remove it.
  • If you’re confident a detractor made a false statement of fact, as opposed to a hyperbolic opinion, contact a lawyer. He or she can analyze the situation and help you work through questions like:
    1. Depending on details, should you send a letter, or use another marketing method, to squelch the effect of bad online reviews?
    2. Is the statement egregious enough to move forward with a full-fledged lawsuit? If yes, do you have enough evidence to effectively argue the case in court?

Find a attorney who will tell you, upfront, if your potential case is a dud or a stud.

To learn more about the nuances of online review defamation, click here. To read more about the history of U.S. defamation law, click here.

Online Review Defamation: Consider This Before Suing

A difficult customer or client posts a scathing review, with a low truthiness quotient, on a popular site like Amazon, Yelp or Ripoff Report. What can you, the business owner, do?

You’ve got three options:

  • Ignore the issue, letting the problem fester and grow.
  • Work with an attorney to get the offending comments removed.
  • Work with a marketing professional to neutralize the review’s negative effects.

According to this Forbes article, 88% of consumers trust online reviews as much as personal recommendations. So ask yourself: do you want to sacrifice business by ignoring a damaging review? I’m sure we can all agree: doing nothing is unwise.

So, with option 1 out of the way, which is better: working with a lawyer or a marketer?

88% of consumers trust online reviews as much as personal recommendations. So ask yourself: do you want to sacrifice business by ignoring a damaging review?

Deciding Between Marketing Fixes & Legal Solutions

Before deciding whether to deal with a damaging online review with marketing methods, legal tactics — or both — consider a few facts about U.S. defamation law.

  • Thanks to a high-profile legal scuffle between a preacher and pornographer, satire and parody aren’t legally defamatory. Consider: did your detractor cloak disdain in satire or parody? Yes? Then you’re probably better off working with a marketer. (Chill Tip: In cases of satire and parody, consider laughing it off. Humorlessness and hyper sensitivity are not qualities consumers easily tolerate.)
  • Is the statement an opinion? If yes, then it’s not defamatory under U.S. law. Comments like, “I hate this product!” or “John Doe is the WORST dentist I’ve ever used!” are opinions.
  • Does putting “In my opinion” or “IMO” before a false statement of fact automatically make said statement an opinion? No. IMO is not a legal shield that confers defamation immunity on all who use it.
  • What happens if an anonymous user posts a scathing review? You may be able to uncover their real identity. Click here to read more about the process.
  • What does it take to win a U.S. defamation lawsuit? It’s difficult, but possible. In short, plaintiffs need to prove that contested statements are about them, in addition to falsity, harm, and a level of negligence. For a state-by-state defamation law analysis, go here.

You Have Options. Don’t Wait, Act. Solutions Are A Phone Call Away.

If your business has suffered because of an inflammatory review, and you’re ready to fight back, let’s talk.

Our team has helped hundreds of individuals — and businesses– pluck defamatory content off the Internet. And note, a lawsuit isn’t always nececcary to remedy an online review defamation issue.
Who are we? Kelly / Warner — a group of attorneys, with strong marketing connections, that excels at fixing online defamation problems. To learn more about us, head here.

Reclaim your reputation — and revenue flow. Get in touch today.

Internet Law 101: Virus Spoofing Can Cost Millions

virus spoofing
Is virus spoofing against regulations? You bet your spam it is. What are the consequences for getting caught? The FTC could force you to fork over millions, which has the power to extinguish an operation.

What Is Virus Spoofing?

Virus spoofing is the act of tricking someone into thinking their computer is infected. Spoofers typically dispatch pop-up warnings onto machines.

The pop-ups can be convincing and usually direct people to buy anti-virus programs. Sometimes the program is completely worthless; other times it works, but is needless. Whichever the case, it’s considered unfairly manipulative and contravenes marketing regulations.

Who Has The Authority To Sue Over Virus Spoofing?

The Federal Trade Commission (FTC) is the nation’s consumer watchdog. Established in 1914, the agency initiates marketing investigations against businesses and individuals — a privilege outlined in the Federal Trade Commission Act.

Attorneys general can also sue over such scams.

Why Is It An Actionable Offense?

The Federal Trade Commission considers Virus spoofing unfair and deceptive marketing, and therefore actionable under the FTC Act. In a recent case, the FTC explained that the defendant “subjected [consumers] to high-pressure deceptive sales pitches for tech support products and services.”

State of Federal Offense?

Deceptive spoofers can face both federal and state punishments.

Accused Of Virus Spoofing?

Has someone accused you of virus spoofing? Next question: “Did you do it?” If yes, contact a lawyer and explain the situation. (Don’t worry; he or she isn’t going to judge you.)

In the best case scenario, your lawyer will be able to loophole you out of the predicament. If not, he or she may be able to diminish the financial blow. Lawyers in this niche know how to negotiate with the FTC, navigate the investigation, and secure settlements with little fanfare (to reduce negative press).

Ready To Consult With An Internet Law Attorney Who’s Dealt With Virus Spoofing Investigations?

If you’re reading this post, there’s a chance you may be on the FTC’s radar. A word of advice: ignoring the issue won’t make it disappear.

But we can help.

Get in touch today; and together, we’ll start solving problems, instead of letting them fester. Let’s talk.

Valve Pulls Plug on Skins Trading, Leaving Industry Up In Air

skins tradingLawsuits and criticism sparked by concerns over teen betting have spun the skyrocketing skins trading industry into an uncertain future.

Valve Makes A Stand Against Skins Trading

Video game developer Valve has essentially pulled the plug on an unregulated online gambling economy that was projected to include $7.4 billion in eSports bets in 2016. After being named as a defendant in two lawsuits, the Washington-based company has asked third-party sites that use Valve’s Steam software to stop letting users access Counter-Strike: Global Offensive contests to bet skins, or guns and knives, that are used in the game.

Valve has stated it has no business relationships with the third-party sites, but a federal lawsuit alleges the company knew about the betting, often done by teens, profited from it and tacitly allowed its growth.

Linking Steam

One suit, filed June 23 in the U.S. District Court for Connecticut on behalf of Michael John McLeod and seeking class action status, alleges that Valve and third-party sites (such as CSGO Lounge, CSGO Diamonds and OPSkins) “knowingly allowed, supported and/or sponsored illegal gambling by allowing millions of Americans to link their Steam accounts” to the sites.

The CS:GO matches are streamed online and shown live on TBS television weekly. Because the skins that online spectators wager on the matches can be redeemed for real-world cash, they are essentially casino chips that are won and lost through illegal gambling, McLeod alleges.

McLeod is now a legal adult but was a minor when he bet on matches.

In light of Valve’s central and pioneering role in eSports betting, observers are trying to determine if the company’s actions since being served with the lawsuits will kill the skins trading industry or transform it somehow. At this point it seems there are far more questions than answers about the industry’s future.

The Future of eSports Betting

So far, at least three of the gambling sites, out of dozens in operation, have said they will close down.

The uncertainty raises seven questions about the future of skins trading:

  1. What will happen to skins-for-cash sites? Valve has asked gambling sites to stop letting their users link to and bet on CS:GO contests, but the company has not reached out to sites that simply allow players to redeem skins for real-world cash, such as OPSkins. Regardless of what happens with skin gambling, there will continue to be CS:GO players who accumulate skins in the course of playing the game. They will still be incentivized to turn those virtual weapons into actual cash. OPSkins also serves the function of linking skins sellers and buyers, another thing that distinguishes it from gambling sites.
  2. Could this brighten the future for exchange wagering operator sites? Another major point raised by Valve in its recent announcement was the need to eliminate bot betting. Some gambling sites create bots to place bets that offset those made against the house. One option to eliminate this problem is facilitating betting between users, or exchange wagering, rather than betting against the house.
  3. Could eSports cash gambling continue with heightened geolocation and age verification requirements? Sensitive to the accusation that it was turning a blind eye to underage gambling, Valve threw the baby out with the bathwater when it ordered the gambling sites to shut down completely. Instead, why can’t it tighten its standards and require affiliated gambling sites to follow all local applicable laws, such as those requiring them to verify users are 18 or older? This would allow adults to continue betting skins.
  4. Will esportsbook cash gambling sites enjoy a boost in business? That isn’t likely to happen immediately because gambling cash on professional match outcomes is illegal in every state except Nevada. New Jersey, where gaming interests are lobbying for the legalization of sports betting, recently enacted temporary regulations allow esports competitors to pay a fee to enter matches that pay cash awards to winners. No casinos in New Jersey have started offering such games.
  5. What happens if the CS:GO gambling sites ignore Valve’s order to stop allowing their users access to matches via the Steam API? On July 13 Valve issued an “In-Game Item Trading Update” that stated, “We are going to start sending notices to these sites requesting they cease operations through Steam, and further pursue the matter as necessary.” Six days later, Valve sent cease-and-desist letters to the 23 gambling sites, but only three of the dozens of such sites announced they had shut down or would be doing so (, and After the 10-day compliance window ended, 11 sites had closed down; four sites had closed temporarily but hinted they would resume operations once they could certify they would meet Steam’s contract conditions and terms; and six sites were ignoring the order.
  6. How will the popularity of CS:GO be affected? Valve’s crackdown on the gambling sites could trigger one of two very different outcomes. One on hand, viewership could decline as access to betting options greatly decreases, depending on how vigorously Valve enforces its cease-and-desist orders. On the other hand, interest from sportsbooks could increase, especially if states other than Nevada ultimately legalize eSports betting.
  7. Is there a future for the skins betting sites that comply with Valve’s ceast-and-desist? Skins gambling site CSGO Lounge, the world’s biggest, accounting for about 80 percent of the stream for a typical CS:GO match, has said it will obtain licenses in countries that allow eSports gambling, an apparent nod toward legitimacy. It is looking for ways to maintain a connection with the CS:GO community. But Steam’s terms and conditions contain no reference to gambling. Valve says these third-party sites are violating language in the Steam Subscriber Agreement that prohibits commercial use of Steam. How far Valve would go to enforce language in such cases

Esports Lawyer Talks Contract Considerations & Protecting Players’ Rights

eSports lawyer
eSports lawyer Aaron Kelly talks about the basics of pro-gaming law.

Lucky you! It’s 2016 and “professional gamer” is a legitimate profession. With high-dollar prizes, endorsement deals, sponsorship and streaming opportunities, pro-gaming is officially a booming industry where elite players make bank — just like non-digital professional athletes.

However, getting to the top takes considerable work and business savvy. Skills are paramount, but you also have to build a fan base, find funding, and navigate certain legalities.

So, right now, let’s review a few eSport business considerations.

eSports Law Introduction

ESports law involves issues related to intellectual property, contractual negotiations, and various Internet regulations.

DMCA Annoyances

Digital Millennium Copyright Act (DMCA) takedown notices are a profit-halting nuisance for gaming professionals who stream game play. Content-hosting platforms, like YouTube and Twitch, tend to avoid legal tussles with corporate King Kongs. So, they’re more likely to remove content instead of thoroughly investigating every DMCA request.

Legally, the DMCA puts the proof burden on defendants. Most sites use ToS (Terms of Service) agreements that extricate websites from intellectual property disputes involving users’ content. Or, in more basic terms: platforms (in most situations), aren’t responsible for the $#!+ users post.

False DMCA Takedown Requests

What if you’re slapped with a false DMCA takedown? Here’s the good news. First, you’d have to prove it’s an invalid request. If successful, you may be able to recover legal fees, and more, because filing a false DMCA takedown notice is a punishable act.

ESports Contracts

Contracts are a huge part of eSports law.
Straight up: players need to approach negotiations like a boss. Invest in an eSports lawyer to broker endorsement, sponsorship, team or player agreements. Having a well-drafted contract could be the difference between getting screwed and making bank.

Click here to read more about legal issues related to eSports contracts.

Streaming Right Issues

Building a sustainable pro-gaming career means leveraging sponsorships.
But exercise caution: many contracts are freighted with pro-corporate parameters that strip players of creative and business rights. For example, some agreements forbid streaming, which effectively prohibits players from earning money on the side.

Team Relationships

Team contracts are a significant part of eSports law. Unfortunately, sometimes, corporate brass pulls the proverbial legal wool over players’ eyes. Again, to avoid shenanigans (or gaming servitude), work with a professional negotiator who crafts win-win plans for players and teams.

Employment Law Considerations

Thinking of starting an eSports business? Are you a player building a brand? Either way, your eSports business might be subject to tax regulations that could affect future profitability. Plus, if you hire staff — like publicity specialists — you must adhere to employment regulations, which differ from jurisdiction to jurisdiction; so, location is something to consider.

Consult With An eSports Lawyer

If you’ve read this entire article, then you know this: eSports contracts and negotiations are the foundations of a sustainable pro-gaming career. For the best profit potential, and opportunity autonomy, team up with an eSports attorney that knows the niche well.

Aaron Kelly is a passionate hobby gamer and top-rated lawyer who works with pro-gamers. He is a grandmaster of contract drafting. Even better? One of his partners, Daniel Warner, is an incredible litigator (his photographic memory helps).

Get in touch today with a Kelly / Warner’s eSports lawyer questions and needs.

Yelp Defamation: Is The Site Required To Remove Defamatory Reviews?

Yelp Defamation

Yelp! (“Yelp”) isn’t happy.

A California judge ordered the review site to remove a defamatory posting. Yelp, for its part, felt the decision defied Section 230 of the Communications Decency Act and appealed — but lost.

Will the ruling affect future Yelp defamation claims? Will business owners be helped or hurt by this turn of events?

Let’s review the case and discuss the potential implications for SMBs.

Background Summary: Business Owner Sues For Defamation Over Yelp Review

We live in the Age of Online Reviews, so it happens all the time. A service provider clashes with a client. Eager to share his displeasure with the world, said client (under the altruistic auspices of “warning others”) takes to Yelp and posts a scathing — often hyperbolic — negative review. Within days, the target’s inquiries come to a grinding halt.

It’s every business owner’s worst nightmare, and it happened to an attorney a few years back — so she sued for online defamation.

Who won?

To shorten a long story, the client failed to appear in court, which triggered a default win, and the judge ordered Yelp to remove the defamatory review.

Yelp’s Position: Forcing Content Removal Defies Section 230 of the CDA

But Yelp didn’t want to remove the review.

In its defense, the review website argued insufficient governance, maintaining that Yelp wasn’t party to the lawsuit, and subsequently not subservient to the court in this matter. Yelp also reasoned that the removal order contravened Section 230 of the CDA, which gives immunity to websites dragged into lawsuits involving defamatory user content. Or, to put it another way, it’s the law that stops users from suing, say, Facebook (or even Yelp) over another user’s post.

Now, please don’t read us wrong: you CAN sue individuals who post libelous statements, but not the social media platform on which the contested statement sits. (Section 230 applies to most social media sites. The rules, however, vary for blogs, news sites and other informational platforms that can legally be deemed “the publisher”).

Excerpt From Yelp Defamation Removal Lawsuit

“Yelp’s claimed interest in maintaining its site as it deems appropriate does not include the right to second-guess a final court judgment establishing that statements by a third party are defamatory and thus unprotected by the First Amendment.”

Why Doesn’t Yelp Want To Remove Defamatory Reviews?

Why is Yelp against weeding the site of defamatory posts? In its estimation, removing content is a free speech quagmire, so the company spares no expense in defending removal requests.

A spokesperson for the review aggregator explained:

“The ruling undermines the free speech and due process rights of consumer reviewers and the online platforms that host their content. In a single jumbled ruling, the court managed to contravene and contort longstanding precedent concerning the First Amendment, constitutional due process and Section 230 of the Communications Decency Act.”

Section 230 of the Communications Decency Act, or CDA, says, “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”

Court’s Reasoning: Asking Yelp To Remove Defamatory Review Doesn’t Have Anything To Do With Section 230 In This Case

According to the court, the removal order wasn’t legally damaging, and therefore fell outside the Section 230 sphere. In other words, since Yelp wouldn’t face imminent legal injury by deleting the defamatory post, the removal order doesn’t interfere with the CDA.

And on a technical note, according to the ruling, Yelp allegedly filed its protest motion too late.

Who Can I Talk To About My Yelp Defamation Issue?

Dealing with a defamatory Yelp review? We can help. Our team has assisted countless small- and medium-sized business owners overcome setbacks related to damaging Yelp reviews. Not every case requires a lawsuit. In many instances, we’ve been able to rectify the situation without filing a claim.

Contact us now. We’ll discuss your situation, (even vent about Yelp if you want), and then start formulating a plan — that’s both effective and budget conscious — to reverse the damage done by Yelp defamation.

Shopify and Stripe: Account Troubleshooting and Legal Advice

shopify and stripe
Let’s take a few minutes to review the Shopify and Stripe alliance. We’ll:

  1. Go over some background info about both companies;
  2. Examine a few issues, like the prohibited businesses list; and
  3. End with some solutions for commonly reported merchant challenges.

Shopify and Stripe At A Glance

Shopify’s Origin Story

Several years ago, some Canadian snowboarding enthusiasts hopped on the startup train. Their goal? To sell equipment online. But our intrepid entrepreneurs didn’t want a generic online store:

They wanted to stand out; they wanted unique!

To achieve said goal, instead of using a standard payment gateway, the group developed a custom solution.

Quickly, they realized that selling snowboarding stuff was great and all, but releasing their skookum e-commerce platform might be even better.

Thus, with goal in mind, the group regularly convened at a coffee shop. And one day, the phoenix that is Shopify rose from a puff of java-infused, brain fumes.

So, who uses Shopify? People who want a highly customizable solution for their online stores. What do professional critics think of Shopify? CNET described the platform as “clean, simple, and easy-to-use.”

Shopify and Stripe Alliance

Who is Stripe?

HQ’d in Ireland, John and Patrick Collison founded the company in 2010. Simply put, Stripe is payment gateway processor for individuals and businesses without private merchant accounts . It’s similar to PayPal.

Stripe is Shopify’s preferred checkout system.

Common Shopify-Stripe Issues

Here’s the frustrating truth: in the world of online payment processors, chaos is the default setting. Problem-free payment processors fall into the same category as unicorns. A kajillion factors can affect a single transaction; problems are inevitable.

In the world of online payment processors, chaos is the default setting. Problem-free payment processors fall into the same category as unicorns. A kajillion factors can affect a single transaction; problems are inevitable.

Caveats in place — here’s a list of common user complaints about the Shopify and Stripe framework:

  1. No Phone Number: Stripe famously doesn’t have a telephone support number (confirmed at the time of writing) — which is a sore point for many people. In defense, Stripe says e-mail support systems are way better than call centers — and, to be fair, many of their customers agree, citing Stripe’s ticketing system as superior to most.
  2. Chargeback Issues: Is Stripe a chargeback circus? Some people think so. Online response representatives for the company disagree, arguing that chargebacks are an unfortunate part of today’s marketplace, but promising to work closely with vendors to resolve chargeback disputes.
  3. Uncaptured Transactions: Some businesses reported an increase in “uncaptured” or failed transactions that coincided with a move to Stripe. Remedying this problem, however, often just involves a few setting adjustments (see tips section below for possible solutions).
  4. Money Transfer / Frozen Payment Issues: Like any payment gateway, the STRIPE-to-bank-account transfer process can take a tad longer than one would like. Again, this is true for nearly every available option. Hiccups, unfortunately, occur.
  5. Credit Card Blacklist: Stripe takes the “credit card blacklist” seriously. If you inadvertently land on the dreaded directory, Stripe may suspend your account till it’s sorted. Don’t think you belong on the list? Enlist a professional fixer to clean up the matter on your behalf.
  6. Blame Game: Some users accuse Stripe and Shopify of playing blame-hot-potato when it comes to various “authorize only” malfunctions.

Prohibited Business Issues

Products sometimes land on the “prohibited businesses list.” In this section, we’ll review some legal basics and discuss potential solutions.

What Is The Prohibited Business List?

The Prohibited businesses list is exactly what it sounds like — a list of businesses that either Shopify or Stripe bans from being sold through their respective platforms. Foodstuffs, supplements, make-up, formulas, cookware and potential weapons are routinely added to the blacklist.

So, what happens if your product lands on the list? In extreme cases, your online store may simply stop working. At that point, enlist a lawyer to negotiate a reinstatement. An attorney can best explain the necessary steps — based on the specifics of your situation — to get the product compliant — and off the list — ASAP.

The Product Blacklist Constantly Changes

The trickiest thing about the Prohibited Businesses List is its instability; it changes, without notice, on the whims of credit card companies.

Products Most Likely To Land On The Prohibited Businesses List

  • Vitamins
  • Herbs
  • Supplements
  • Weapons and Potential Weapons (including knives and certain fishing gear)

Please don’t read this wrong, not every supplement is doomed to a blacklisted retirement. Just be aware that supplement sales come with an additional set of regulations and considerations.

Please don’t read this wrong, not every supplement is doomed to a blacklisted retirement. Just be aware that supplement sales come with an additional set of regulations and considerations.

Increased Number of Chargebacks After Switching To Stripe

A number of people report an increase in charbacks after switching to Stripe.

Is the criticism fair?

Well, it’s a gray area.

With Stripe, the default privacy setting is “wide open;” users must activate protections. A lot of folks don’t notice the default setting, launch their stores with unsecured payment accounts, and ultimately get burned with fraudulent charges.

With Stripe, the default privacy setting is “wide open;” users must activate protections. A lot of folks don’t notice the default setting, launch their stores with unsecured payment accounts, and ultimately get burned with fraudulent charges.

The takeaway: Manually set security preferences when prepping your Stripe account to avoid a flood of chargebacks.

Clicking “I Agree” Means Absolving Shopify Of Fraud Responsibility

Here’s an excerpt Stripe’s Shopify user agreement:

“You are responsible for verifying the identity of users and of the eligibility of a presented payment card used to purchase your products and services, and Shopify does not guarantee or assume liability for transactions authorize and completed which may later be reversed or charged back. You are solely responsible for all reversed or charged back transactions, regardless of the reversal or chargeback. Shopify may add or remove one or more types of cards as a supported payment card at any time without prior notice to you.”

The agreement also states:

“You acknowledge that you provide this personal information regarding you and yours customers at your own risk.”

So, what DOES all this legal mumbo jumbo mean? In a phrase: Shopify isn’t responsible for bad transactions, nor any personal data problems (hacks) that may arise. Sound sketchy? Perhaps. But nearly all — if not all — payment processors protect themselves in this manner because it’s the right business decision.

Connect With An Online Sales Lawyer

Kelly Warner helps online entrepreneurs. An Internet law firm, we partner with startups, established companies and individuals on issues related to online reputation, e-commerce, marketing, privacy and intellectual property. We’ also assist people with issues related to Shopify and Stripe. To learn more about our practice, head here. Ready to talk? Get in touch today.

eSports Law 101: Contract Advantages and Legal Agreements

esports contracts lawyer

State of the eSports Union: The Economic Forecast Is Exceptionally Favorable

Interested in eSports? Well then check out these facts and figures:

  1. Last year, every month, more than 90 million gamers logged onto Twitch, a streaming arena where fans can live chat with other spectators while watching eSport matches. (It’s the 21st century equivalent of going to a baseball game, without the stress of traffic and parking.)
  2. Last year, pro-gaming teams generated about $750 million in revenue; North American teams earned $224 million.
  3. Currently, video game publishers and event arenas are making the bulk of the money because many players are chained to unfavorable contracts.
  4. According to industry experts, eSport revenues will reach multi-billion-dollar territory within two years.

So, what does all this mean for pro- and semi-pro players? It’s time to protect your profits and professional freedoms.

How Do Cyber Athletes Earn Money?

No longer reliant on competition purses, so-called “cyber athletes” earn money in a number of ways. In addition to winning prize money, they can:

  1. Generate revenue through game play subscription services, like Twitch.
  2. Make advertising dollars through streaming channels.
  3. Join a professional, salaried team.
  4. Secure corporate sponsorships and endorsements. Currently, mostly publishers and developers establish partnerships. However, as eSports grow, lifestyle companies, in search of unique branding opportunities, are also wooing gamers.
  5. Write and self-publish playbooks and blogs.

eSports Contracts: What Players Should Consider Before Signing

Whether it’s an agreement between companies and players, players and teams — or some other combination — contracts are the heart of professional eSports. Here’s a list of things cyber athletes need to consider before signing on the dotted line.

  1. Sponsorships: The ideal player contract should be hyper-specific with meticulously defined expectations. Looking to work with several sponsors simultaneously? Triple check the fine print for exclusivity clauses.
  2. Advertising: Agreements should specify advertising parameters, for both players and sponsors. Do you want different rules to apply to certain types of advertising opportunities? These types of questions must be considered.
  3. Event Participation: For player and team contracts, it’s wise to include a season schedule that lists event participation expectations and related earnings percentages.
  4. Duration: Team contracts should stipulate start and end dates. Also, most include some sort of contract extension clause.
  5. Agency: Do you want free agency stipulations? Make sure it’s in your contract.
  6. Employment Laws: U.S.-based pro-gamers must consider employment laws in their respective jurisdictions. If not, you could suffer serious headaches related to health insurance, hours of service, overtime and off-season compensation.
  7. Subscriptions: If a sponsorship or endorsement contract is contingent on subscription statistics or viewer numbers, performance goals and compensation must be detailed in the contract.

ESports Contract Drafting & Negotiations

Aaron Kelly, Daniel Warner and Raees Mohamed help pro-gamers and eSports teams with business and legal needs. A pioneer in gaming and Internet law, we’re an ideal fit for established and emerging cyber athletes and organizations.

Are you ready to speak with an experienced, down-to-earth attorney about a gaming business or pro-gaming contract?  Get in touch today.