Affiliate Marketing

Affiliate marketing is a marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate's own marketing efforts. Examples include rewards sites, where users are rewarded with cash or gifts, for the completion of an offer, and the referral of others to the site. The industry has four core players: the merchant (also known as 'retailer' or 'brand'), the network, the publisher (also known as 'the affiliate'), and the customer. The market has grown in complexity to warrant a secondary tier of players, including affiliate management agencies, super-affiliates and specialized third party vendors.

Affiliate marketing overlaps with other Internet marketing methods to some degree, because affiliates often use regular advertising methods. Those methods include organic search engine optimization, paid search engine marketing, e-mail marketing, and in some sense display advertising. On the other hand, affiliates sometimes use less orthodox techniques, such as publishing reviews of products or services offered by a partner.

Affiliate marketing—using one website to drive traffic to another—is a form of online marketing, which is frequently overlooked by advertisers. While search engines, e-mail, and website syndication capture much of the attention of online retailers, affiliate marketing carries a much lower profile. Still, affiliates continue to play a significant role in e-retailers' marketing strategies.

In 2011, the FTC began more strict enforcement of its guidelines for online blogging, social media and affiliate marketing by suing companies that were violating provisions of the law. Actions against Legacy Learning Systems and Acai Berry sent the message to all affiliate marketers that the FTC is “raising the bar” on disclosure. All affiliate marketers are expected to be in compliance with FTC guidelines.


If you are considering setting up an affiliate marketing program for you Online or E-Commerce business, please don't hesitate to contact an Internet Lawyer to ensure that you are following all of the necessary guidelines.

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Maryland vies to emerge as 'epicenter' of U.S. cyber security efforts

Maryland vies to emerge as 'epicenter' of U.S. cyber security efforts:

Maryland wants to become the "epicenter" of that nation's cyber security efforts and wants to invest millions in companies to get there, the state's top economic chief said Thursday.

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E-Commerce Lawyer: Update on Online Taxes

Executive Summary

Analysts estimate that national, state and local sales tax losses on e-commerce will grow to $11.4 billion by 2012.  In the middle of the worst economic downturn since the Great Depression, states are pressed to find additional sources of revenue.  With e-commerce sales continuing to rise, and with both purchasers and sellers usually avoiding tax liability for out-of-state internet transactions, states are eager to close the gap.  To do so, states appear to be following one of two distinct paths.  First, states are joining the Streamlined Sales Tax Project (“SSTP”), which is a multi-state effort to standardize the collection of taxes from e-commerce.  Second, states are acting unilaterally and creating tax laws that will bring in tax revenue from e-commerce transactions.  One such example is a statute that was recently enacted in New York that requires out-of-state online retailers to collect New York taxes if the business has New York-based affiliates who collectively generate more than $10,000 worth of business in a given year.  Amazon.com sued the State of New York, arguing that the statute was unconstitutional, but the court disagreed with Amazon, holding that Amazon’s in-state affiliates created the requisite nexus allowing New York to require Amazon to collect sales taxes.  As discussed more fully below, the Amazon.com case gave momentum to the SSTP.

In light of the SSTP’s growing momentum and New York’s recent Amazon.com decision, online retailers should take three actions.  First, online retailers should be attentive to developments concerning the SSTP and where states, like New York and North Carolina, are acting unilaterally to pass legislation.  Second, online retailers should conduct a detailed examination of their business practices and attempt to mitigate areas where a nexus might be unexpectedly asserted.  Third, online retailers should conduct a cost benefit analysis concerning the business value and profitability of affiliate programs in each state.

Click here to read the full article from DONWEST LEGAL, LLC

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Internet Law Case: Employer did not violate employee’s privacy by accessing personal laptop

Sitton v. Print Direction, Inc., — S.E.2d —, 2011 WL 4469712 (Ga.App. September 28, 2011)

A Georgia court held that an employee using a personal laptop to conduct business for a competitor did not have an invasion of privacy claim when his employer busted him at work using the laptop to send email.
Plaintiff-employee worked for a printing company.

His wife also owned a printing business. On the side, plaintiff would broker printing jobs, sending them to his wife’s company. He would bring his own laptop to work and use that to conduct business for his wife’s company while at work for his employer.

One day, the boss came into plaintiff’s office (apparently when plaintiff was not in the room) and saw that the computer screen on plaintiff’s computer showed a non-work related email account, with messages concerning the brokering of print jobs to the wife’s company. The boss printed out the email messages.

Plaintiff sued, claiming, among other things, common law invasion of privacy and violation of a provision of the Georgia Computer Systems Protection Act. The case went to trial, and plaintiff lost. In fact, he ended up having to pay almost $40,000 to his employer on counterclaims for breach of loyalty. Plaintiff sought review of the trial court’s decision. On appeal, the court affirmed.

The appellate court affirmed the trial court’s finding that the boss’s access to plaintiff’s computer did not constitute common law invasion of privacy based upon an intrusion upon plaintiff’s seclusion or solitude, or into his private affairs. The court held that the boss’s activity was “reasonable in light of the situation” because:

• He was acting in order to obtain evidence in connection with an investigation of improper employee behavior,
• The company’s interests were at stake, and
• He had “every reason” to suspect that plaintiff was conducting a competing business on the side, as in fact he was.

To bolster this holding, the court cited from a Georgia Supreme Court case that said, “[T]here are some shocks, inconveniences and annoyances which members of society in the nature of things must absorb without the right of redress.”

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