1. The 2010 Women Grow Business Boot Camp Sponsored & hosted by Network Solutions and Steptoe & Johnson LLP June 19, 2010, Washington, D.C.

4. Choice of Legal Entity (cont’d.) Some factors we consider when selecting the type of legal entity Taxation Limiting liability of owners or investors Transferability of equity interests in the business Raising capital Formalities necessary to maintain the entity structure

5. Choice of Legal Entity (cont’d.) Sole Proprietorship Owned by individual; controlled by owner DANGER: owner personally liable for all business debts all business income considered personal income taxed at personal income tax rates

6. Choice of Legal Entity (cont’d.) Partnership Two or more individuals or other entities under a partnership agreement Controlled by the partners, per partnership agreement (note: transferability may be limited) All general partners fully liable for debts, liabilites and obligations of partnership Limited partners are liable to the extent of their capital contribution Income taxed to the extent of the partner’s distributive share of the partnership income. No tax on the partnership at the entity level

7. Choice of Legal Entity (cont’d.) Corporations Shareholders are NOT personally liable for corporate debts, obligations and liabilities (liability limited to investment) Management limited to limited number of individuals (officers & directors) Disadvantage: if C-Corp, pays corporate tax on earnings. Shareholders pay individual tax on dividends (“double tax”). If S-Corp, taxed at personal tax level Must adhere to certain formalities (board meetings, shareholder meetings, minute books, etc).

8. Choice of Legal Entity (cont’d.) Limited Liability Companies No member of an LLC is personally liable for the debts, liabilities or other obligations of the LLC. Owner’s liability limited to amount of capital contributed Management may be centralized in certain members LLC may elect partnership or corporate tax treatment for federal income tax purposes LLC may (if desired) limit the transfer of membership interests and substitution of new members per Operating Agreement No formalities require to maintain LLC (of course, though, must create it formally)

9. Marketing Law Basics Can Spam Law The surveys from you indicated that the majority who are marketing use e-mail solicitations Be aware of the Federal Can Spam Law You MAY send unsolicitated commercial e-mails, provided you do so per the law

10. Marketing Law Basics (cont’d.) Under Can Spam – the key requirements are: no false or misleading headers no deceptive subject lines (“here’s the information you requested” – when not requested) include valid postal mailing address and company name provide working opt-out method and HONOR opt-outs no later than 10 business days (can’t charge a fee, ask for more than e-mail address, or require more than reply e-mail or visiting more than a single page on a website) identify as advertisement check your privacy policy to make sure being consistent FTC primarily enforces, penalties can be severe $$$$

11. Marketing Law Basics (cont’d.) Telemarketing – BEWARE There are a host of federal and state laws restricting telemarketing Regulators/private parties can sue- $$ Live calls: Feds: Existing customers can be called (3 mos for an inquiry/18 mos for a purchase), unless they tell you NOT to call – then you must remove them from your calling list Prospects – do not call databases must be scrubbed first. Calling hours – nothing before 8am, after 9pm, per feds (some states more restrictive)

12. Marketing Law Basics (cont’d.) Fax Marketing heavily regulated and very litigious need existing business relationship or prior express consent to fax unsolicited fax ads specific opt-out language on fax – without it, separate violation must promptly process opt-outs (within 30 days) best to seek counsel

13. Final Points Advise any employees to get any advertising initiatives approved by you or another responsible official – sometimes employees think there are being creative and “running with the ball.” This can lead to $$$ penalties, litigation costs, loss of goodwill, etc. Any lawsuit notices, threatening letters, investigations – PAY ATTENTION – do not ignore – defaults, annoyed regulators, etc.

15. Trademarks 101

17. Patents

18. Copyrights

20. What is a Patent? Exclusive right to prevent others from making, using, selling or importing an invention in the United States Exists for a limited time only After expiration, invention becomes part of public domain and can be made, used, or sold by anyone

21. Copyright Examples Bundle of exclusive rights in a “creative work” Includes right to reproduce a work, to create adaptations (“derivative works”), to distribute copies, and to publicly perform/display a work Designs Patterns Sound Recordings Paintings Literary Works Software What is a Copyright?

22. What is Trade Dress? Overall look and feel of a product or its packaging Signifies to the consumer that it comes from a particular company Sum-total of the appearance of the product or its packaging, including: Trademarks Copyrights Other non-protectable design features

24. Importance of Trademarks in Business

25. Selecting a Trademark and Domain Name

26. Obtaining and Protecting Trademarks

27. Trademark and Domain Name Enforcement Basics

30. Shapes:

31. Sounds:

33. Ensure that your customers and the public associate your brands with your business

35. Is someone else using the same or a similar mark, especially for the same/similar goods or services?

36. Has someone filed an application for or registered the same or a similar mark?

38. Trademark rights are geographical in scope

39. If a trademark is used locally, only local rights are granted

40. If a trademark is used in interstate commerce, national (federal) rights are granted

41. Registration of a trademark

42. Can apply based on current use of a mark

43. Can also apply based on a bona fide intent to use a mark in the near future

45. Document situations of confusion

46. Help co-workers use your company’s marks properly

48. Proper use on all business documents, advertising, displays, packaging, labels, and correspondence is critical to survival

49. Use the ®, TM, and SM trademark notices as frequently as possible!

50. Make sure that only those with a license to use the marks use them under your control

51. DO NOT permit modification of your mark

53. Business uses of social media

54. Best practices for developers

55. Developing and executing a social media policy

57. Twitter

58. YouTube

60. Business Uses for Social Media Increasing brand exposure Improving customer satisfaction and investment Search engine optimization Application development

61. Developer Considerations Use the proper platforms for your demographic, including geographical considerations Consider mobile applications and different types of hardware Look to user community to help determine optimal app features and feature updates Understand terms and conditions for developers – different and separate from user policies Conduct legal review before releasing an app to the public Use your trademarks properly and respect others’ trademarks and copyrights

62. Social Media Policy Basics Policy defines acceptable social media behavior for employees, third parties such as licensees and affiliaties, and other third-party users of social media resources May include one or more of the following: Information on philosophy, strategy and presence Guidelines for employees authorized to speak officially for the company, including who is authorized to speak. General employee and affiliate guidelines Terms and conditions for general user community Ensure that policy is designed to suit your organization’s needs – do not copy another organization’s policy

63. Social Media Enforcement Mechanisms Maintain library of information on major platforms’ terms and conditions and enforcement policies Facebook has takedown procedures for copyright infringement and other IP infringement, as well as an impersonation reporting mechanism Twitter also has copyright, trademark, and impersonation reporting options YouTube allows for submission of copyright complaints; videos that violate community guidelines can be flagged

64. THANK YOU! Michelle W. CohenPartner, CIPPThompson Hine LLPPhone: 202.263.4151Email: michelle.cohen@thompsonhine.com Rachel HofstatterAssociateSteptoe & Johnson LLPPhone: 202.429.3903Email: rhofstatter@steptoe.com