If you have a website, you likely have a page with Terms of Service that outline the relationship between you and the users (if you don’t, you probably should, even if you just have a blog). There are two huge problems surrounding Terms of Service (from now on, for brevity, “TOS”) that everybody knows, but few people try to solve:
1. Everybody is copying TOS from other websites.
2. Nobody reads them anyway.
After this reality check, I tried to figure out the consequences of these practices, and see if I could find some solutions.
Problem 1: Everybody is copying TOS from competitors.
If only a service like Docracy existed, we would have totally copy-pasted entire chunks of their TOS. Try googling a random sentence from your TOS, and see how many fellow websites use it. It’s all boilerplate, and copyright doesn’t even cover that stuff. I asked a lawyer with a lot of experience in drafting TOS, Brady Kriss:
Most internet companies just “take inspiration” from the TOS of similar services. How good is this practice?
Taking “inspiration” from other TOS is great. You should absolutely look around at other sites and see what TOS you like, what ones make sense to you, and what is just too confusing or badly worded. And then make sure you keep the good stuff and ditch the bad stuff for your TOS. Looking to see what sites similar to yours, and so would have similar needs in terms of a TOS, is a really smart move. But you’ve got to be wary of all the not-so-great TOS there are out there, even on sites from totally reputable companies. You definitely don’t want to just copy and paste a bad TOS into your site. The other thing you’ve got to watch out for is grabbing terms from a TOS that doesn’t match up with your site or the service you’re providing. You could easily end up including terms that you don’t need, which only makes for an even more confusing TOS, or you could end up leaving out a really important provision. The repercussions of leaving out a provision from a TOS can be severe - if you don’t have a proper DMCA provision you could be on the hook for copyright infringements your users commit on your site. Having a bad TOS for a web service can really get in the way of selling it, if that’s what you want to do down the line.
So, just like in school, “intelligent copying” actually works! And, if everybody copies the same clauses, we might as well come up with a standard, that can be open sourced on Docracy making all this copying “guilt free”. There’s an other upside in establishing a standard TOS: if all e-commerce TOS are drafted from a standard, once I know the standard I can avoid re-reading every e-commerce site’s TOS. Two birds with one stone. On Docracy, we host one of the few open source TOS, Wordpress’ model TOS for blogs.
Brady, What do you think of Wordpress TOS? Do you think TOS are a contract category mature enough to be standardized?
I absolutely think that a great deal of TOS content is ripe for standardization. It would be hugely beneficial to users in general to have a baseline for what is actually contained in the TOS that they effectively sign when the use a website. It would also be great for creators of websites and web services to have a standard baseline for what needs to be in a TOS. But having a standardized baseline and having a one-size-fits-all TOS are two very different things. For sites that are generally very similar, like blogs, a standardized TOS is great. But for a new and innovative web service, you really do need something custom. Making the decision on whether or not to hire an attorney to draft a custom TOS for your site is just like making the decision to hire a professional vs doing it yourself for a lot of things. Sometimes the stakes aren’t that high, and you can just wing it. Sometimes it really matters, and you’ve got to make sure you’ve got an expert to do it for you. And sometimes you’re somewhere in between, and you can afford to spend a lot of time learning a new area and hoping you got it right.
Docracy is a brand new service, in a delicate market: the stakes were high, so of course we hired a lawyer to fix our TOS. But let’s imagine you are in that middle ground. I asked Brady what’s a good way to draft TOS:
I think the best way to draft a TOS - and the way I do it - is to start with a list of the point you need to get across to the users of your site, and then try to communicate the points to them in the clearest - but still legally enforceable - way you can. The list of things you need to get across start with the standard legal stuff, like who the parties to the agreement are, what the warranties and representations of the parties are, what do you have to do to agree to the contract, what the timeframe of the contract is, etc. Then, you think about what things your users need to know that are particular to your website or service. Are you allowing any user-generated content? Then you need to get a license to display the content your users provide, and you need to comply with the DMCA. Are you making a site for kids? Then you need to comply with COPPA. Are you making a cloud storage service? Then you need to make it clear to your users how you’re going to deal with their data.
While you take notes, I asked Brady for some “inspiration”, just in case the stakes aren’t that high:
I think Twitter has a pretty stellar TOS. Legally solid, readable, and it has some handy call out boxes to make sure users really see the important and unexpected bits. TOS can be a powerful PR tool. TwitPic and Dropbox, among others, can attest to the level of bad PR that can come from a bad TOS or a bad change to a decent TOS. A well written and well presented TOS can also lend a great deal of credibility to a website.
I’ll tackle the second problem in a follow-up post next week, stay tuned!