Terms of Service “TOS” Drafting Tips

traverselegal - June 25, 2012 - Internet Law, Terms of Service "TOS", Website Agreement Tips


Terms of service  (TOS) or terms of use (TOU) website agreement are very important as it is the contract betwen you and your website visitors. It’s perhaps one of the most overlooked items for start-up companies and small businesses. As well as large businesses who have a website which becomes a primary portal for their website visitors, as well as an e-commerce portal for them to do business and take money.

Looking to Draft Website Agreements?

Quick tips:

  • Never copy and paste someone else’s terms of service or terms of use.  Your website agreements need to reflect you business model and risk tolerance. Drafting terms of service is something our attorneys do every day.  We know how to inexpensively and effectively draft your TOS or TOU to suit your needs.
  • Terms of service essentially tell website visitors everything they need to know about the rules your website.
  • Yes, you can get sued for violating your own terms o f service (TOS) / terms of use (TOS).

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What Are Your Terms of Use for Your Website Visitors?

My name is Internet Lawyer Enrico Schaefer and today we are going to talk about terms of service for your website. Every website should have a variety of website agreements. Including a terms of service, which is often referred to as a TOS, or terms of use, which is TOU, and also your privacy agreement, which is going to spell out what kind of information you’re collecting on the website, and what your policies are for your customers who visit you and perhaps even transact business on your website.

But let’s talk a little bit today about terms of use. A terms of use website agreement is very, very important. It’s perhaps one of the most overlooked items for start-up companies and small businesses. As well as large businesses who have a website which becomes a primary portal for their website visitors, as well as an e-commerce portal for them to do business and take money.

Your Terms of Service is a Contract

You need to think about the website terms of service agreement as the primary contract between you and everyone that walks through your door, all your website visitors. This is going to be an agreement which provides the terms and conditions for those people who use your website, and it is a binding contract as are all website agreements.

Now, there are some ways that website visitors, customers, etc. can attack your terms of use or terms of service website agreement. But the better you draft that agreement, the more thought you put into that agreement, the less subject that agreement is going to be attacked in court on being either ambiguous, unconscionable, or inconsistent with other language in your website.

So, the website terms of service is going to be critically important to protect you and your company from liability if there should ever be any problem. Let’s say there’s a data breach and you lose data. Let’s say that the person thinks that you’ve engaged in some sort of copyright infringement or trademark infringement on your website using third-party websites. Let’s say your website actually solicits and accepts user-generated content so that third persons can actually put information onto your website. These types of things can create liability.

So, what you’re going to tell your website visitors is that by using your website, they’re accepting and agreeing to the terms and conditions set forth in your TOS or terms of service. This is going to be your primary battleground. If there is a problem, you’re going to point at the terms of service to indicate where you can be sued, what it is you agreed to, any limitations of liability that may exist, what the proper venue is, what the choice of law is, these types of things.

What Should Be Included in Your Terms of Service?

So, what types of things does your terms of service agreement need to have in it? We always get the questions, “Do you have a website agreement form for a terms of service agreement that I can use for my website?” Well, there is no form that you can use for your website. The reason is simple, because your business model is going to dictate what goes in to your terms of service. So, people who want terms of service, TOS forms, are looking for the template that they can then hopefully stylize to their line of business.

Now, of course, the best thing to do is get a terms of service drafted by an internet lawyer who understands what needs to go into it, in order to protect you and your company. One of the things you’re going to want in there is copyright notice. You’re going to want to tell users of your website what your copyright policy is. Can someone else use your content and if so, how? What are the limitations on copyright use?

Your Privacy Policy is Also Important

You’re going to refer to your privacy policy and protection of personal information so that you’re telling the user to go to the privacy policy. You’re typically going to identify what representations and warranties are being made on your website and, of course, typically the answer is none.

You’re going to want to have a provision which says there is no warranty being provided by you of any kind, that the information is accurate, that the information contained on the website creates some sort of contract, these types of things. Of course, you’re going to want a limitation of liabilities that says, “Hey look at it.” If there’s a problem with something that happens here, you are limited to certain levels of damages, or no damages at all, if there’s a problem.

You want to spell out what purposes people can use your website for. You want to claim content ownership where applicable. You want to indicate that your content and your copyrights can’t be modified. You want to indicate whether or not the website can be used for commercial purposes or not. You want to add items concerning whether or not there is going to be indemnity from the website visitor to you if they’re inputting user-generated content, and that content infringes somebody else’s copyright or trademark. They need to indemnify you against liability.

You need to talk about whether or not there’s going to be a choice of law or choice of jurisdiction in venue. Then you’ll have a bunch of boiler plate terms concerning severability waver and these types of terms.

Your Terms of Service Should Match Your Business Model

Now, the first thing that a good website agreement lawyer is going to do is understand your business model, right? Because you need to match the business model to the terms of service agreement. So, the first thing they’re going to do is they’re going to analyze your business model. They’re going to identify which of dozens and dozens and dozens of potential provisions might need to go into your agreement. They’re going to stylize that to your business model, and then you post it to the website.

cease and desist copyright infringementNow, for everyone who’s doing a website agreement and working with an attorney to get these things drafted, I always tell this, “Think of your website agreement as a living document.” You want to be to modify it as you go because your business model will change. As different cases are decided in court as a result of litigation to contest a website agreement, terms of service, or privacy agreement, you’re going to want to be able to have your lawyer say, “Hey this new case just came down in California or in New York, or Florida, or Texas, or Michigan, and we need to incorporate this new concept into the website agreement.”

Perhaps a court holds that certain provisions in a website agreement in terms of service are not enforceable unless certain requirements are met. These are the types of things you and your website agreement attorney need to be thinking about as you put this into play. One word of advice – many new businesses and start-ups will often take a look at other competitors’ terms of service and cut and paste those onto the website.

There could be a number of problems with that. The first is you don’t know whether or not it’s any good. The second is they may have copyright protections in those terms of service. The third is that it’s not customized to you. So, spend a little money and get the most important contract that you will have ever have drafted for your website, right the first time. My name is Internet Law and Cyber Law Attorney Enrico Schaefer. We’ll see you next time.

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