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Sweet marketing music

Tanner Montague came to town from Seattle having never owned his own music venue before. He’s a musician himself, so he has a pretty good sense of good music, but he also wandered into a crowded music scene filled with concert venues large and small.But the owner of Green Room thinks he found a void in the market. It’s lacking, he says, in places serving between 200 and 500 people, a sweet spot he thinks could be a draw for both some national acts not quite big enough yet for arena gigs and local acts looking for a launching pad.“I felt that size would do well in the city to offer more options,” he says. “My goal was to A, bring another option for national acts but then, B, have a great spot for local bands to start.”Right or wrong, something seems to be working, he says. He’s got a full calendar of concerts booked out several months. How did he, as a newcomer to the market in an industry filled with competition, get the attention of the local concertgoer?

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by Andrew Tellijohn
11/01/2003

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Law

business builder law  

Watch out for shifting
rules on wild, wild Web

by Gregory Golla and Michael Cohen  

Internet law is evolving and what is true today may not be true tomorrow. As a small-business owner, you can have a full-time job trying to keep on top of it.

And what may seem like a small detail or be an innocent mistake can easily turn into a big-time expense. We’ve summarized some of the newest and most wide-reaching changes here.

New domain names
Dot-com, dot-org, dot-net — and now dot-us. The U.S. country code dot-us can be purchased by private entities. To qualify for a dot-us domain name, the registrant must be a U.S. citizen or resident, business or organization, or a federal, state or local government. Businesses with a bona fide presence in the United States can also register a dot-us domain name.

Registrations are available through accredited registrars, who can be found at www.nic.us/register/dotus_registrars.html. Businesses should continue to evaluate whether to register their domains under new extensions as they become available.

Search engines, banner ads
Many businesses advertise on search engines. These ads often show up as banner ads or higher placement in search results. The courts have agreed that these types of ads are legal and liken them to placing a billboard near a competing store. However, using a competitor’s trademarked or copyrighted name within a company’s metatags is illegal.

Third-party pop-up ads have also been recently challenged, particularly if they obscure the advertisements on the sought page. A widely discussed example is that of Gator Corp., a pop-up advertiser that has been charged by various newspapers for trademark infringement. These and similar cases are still being decided.

Taxation
On October 21, 1998, President Clinton signed into law the Internet Tax Freedom Act (ITFA). In November 2001, the ITFA was extended for two years. The ITFA is an effort to preempt state and local taxes, viewed by some as a potential threat to the growth and viability of e-commerce.

As the federal moratorium on new sales and use taxes on e-commerce was set to expire on November 1, 2003, legislative

efforts are underway to make the moratorium permanent as applied to Internet access. A number of states, including Minnesota, are looking at ways to capture some of the sales and use tax not currently collected through online sales.

Auction sitesThe business success of eBay is well known. One of the more recent trends, especially for smaller businesses, is the use of Internet auction sites for both the sale and purchase of products.

There are two main types of Internet auctions. In an ascending price auction (often referred to as a “forward” or “English” auction), a seller offers a product for sale on the seller’s own site or an Internet “marketplace” site, and bidders place bids in ascending amounts. After a pre-determined time, the top bidder pays the seller, completes the transaction, and the product is shipped.

In a descending price auction (“reverse” or “Dutch” auction), a buyer announces its product needs on its own or an Internet marketplace site and sellers submit their lowest price. After a pre-determined time, the seller selects the lowest bid, completes the transaction, and the product is shipped.

Most auction sites have a method whereby buyers can rate sellers and vice versa. Sellers are prohibited from placing false testimonials in their auctions, and must also refrain from placing bids on their own products to increase the price. As reported on the Federal Trade Commission’s Web site, these “practices are not only unethical, they’re also fraudulent.” Sellers also may not offer illegal items through Internet auctions.

Internet privacyMinnesota’s two laws related to Internet privacy and commercial e-mail solicitation — otherwise known as anti-spam legislation — became effective March 1, 2003. The privacy portion of the law is designed to restrict the ability of an online service provider to disclose “personally identifiable information” including e-mail addresses, phone numbers, online contact viewing habits, and browsing history to third parties.

The law provides limited exceptions for such disclosure and sets forth specific requirements for obtaining authorization. Violators of the law can be sued for $500 or actual damages for each violation.

The anti-spam law prohibits the transmission of commercial e-mail messages that misrepresent any identifying information of the originator or that contain false or misleading information in the subject line. “ADV” must appear as the first characters of any commercial e-mail message; messages with material of a sexual nature must start with “ADV-ADULT.”

The law provides limited exceptions and requires senders to provide methods to allow recipients to stop further transmissions. Violations of the law can result in damages of the lesser of $25 per message or $35,000 per day for misrepresentation of identifying information and the lesser of $10 per message or $25,000 per day for failure to appropriately label a commercial message.

Individual states have also enacted laws saying that sending unsolicited e-mail into other states may subject companies to liability in other states. Each state's laws should be investigated prior to sending any unsolicited e-mail — many states have much more stringent requirements than Minnesota.

Accessibility and ADAIn one of the first court decisions to consider the applicability of the Americans With Disabilities Act (ADA) to Web sites, a federal judge dismissed a lawsuit contending that a Southwest Airlines site violated the ADA because it was not accessible by blind users. The judge ruled that it was up to Congress to specify by legislation that Web sites were a “place of public accommodation.”

New technology will always beget new laws (and lawsuits). Business owners need to constantly review the methods with which they do business or advertise online to avoid potential land mines.