Here at Truth on the Market, weâ€™ve already broken a cardinal rule (at least a cardinal rule among transactional attorneys)â€”weâ€™ve commenced a relationship (this blog) prior to finalizing the governing document. In fact, we havenâ€™t even talked about a governing document, although Iâ€™ve given it some thought. One of the reasons for this is that as Geoff and I recruited folks to join the blog, it didnâ€™t seem like the right time to hit them with a contract loaded with clauses like reciprocal indemnification, binding arbitration, consent to jurisdiction, perpetual royalty-free license, etc.
An initial question, of course, is whether a group blog even needs a governing document. Weâ€™re not talking about a business deal here. Itâ€™s just some law profs spouting off on various topics. Papering the relationship may be contrary to the spirit of the blogosphere (similar to putting â€œTMâ€? on a blog tagline).
There are, however, a number of issues that I think should be addressed in a written contract. The biggest in my mind is copyright. Absent agreement, as a general matter each author holds the copyright to his posts. This means if we had a falling out with an author here, that author could force us to pull all his posts from the blog. This obviously would be detrimental to the blog and the remaining bloggers. Because no one knows at the front end who if anyone will be leaving the blog on bad terms, itâ€™s generally in everyoneâ€™s best interest to address the issue now. My suggestion is that we grant each other a perpetual, royalty-free license to use one anotherâ€™s posts on this or any successor blog.
Another big issue is domain name ownership. Weâ€™ve had some early success in getting other blogs to link to us. As you know, these links are important in terms of search rankings, google rating, etc. Because all the links are specific to the domain name, the domain name becomes a very important asset for the blog. Again, I think some sort of perpetual, royalty-free license is in order for the domain name.
In the next week or two, Iâ€™m planning to put together a term sheet for a group blog agreement that addresses the above and other issues. Before I launch into that, however, I want to gauge the reaction, particularly of my co-bloggers, of formalizing the relationship. I know from experience that in some situations papering a relationship is not well received, even though it may be wise from a legal perspective. In particular Iâ€™m reminded of the time I lined up a handyman to do about $500 worth of work on my house. I presented him with a â€œHouse Repair Agreementâ€? I had drafted. Instead of signing it, he decided to take a pass on the work. So did the second guy. For the third guy, I went with a handshake.
UPDATE: Larry Ribstein, the guru of unincorporated entities (among other things), raises the issue of whether a group blog is a partnership (see here). If it is, as he points out, the copyright ownership issue is different. For reasons I’ve blogged about before (see my comments to this post), it is probably best for a group blog to avoid partnership treatment.Â And due to cost and other considerations, I don’t think it makes sense to go with a corp. or LLC. Hence, my thought on handling the issue is to include an “anti-partnership” provision in the agreement, i.e., “while we are an association of more than two people, we are not carrying on a business for profit.” Any revenue we may get from selling ads will be used to cover the costs of/invest in the blog. I realize that a court could still nevertheless find we are a partnership, so the agreement would also include provisions that apply in the event a court ignores our express intent and finds we are a partnership. Thoughts on this approach Larry?
DISCLAIMER: NEITHER THE ABOVE NOR BELOW IS MEANT AS LEGAL ADVICE!