Technology makes businesses more efficient and productive. It also keeps people connected (and sometimes distracted…). During the COVID-19 pandemic, it was really the only way to keep some businesses running.
But are you crossing a legal line (or several lines…) you weren’t even aware of?
Technology and the Law: A Love-Hate Relationship
Technology has a… complicated relationship with the law, especially in recent years. Innovative companies make staggering technological advancements, and the law (eventually) decides whether those advancements fit within existing laws or require new laws.
By the time legislators have drafted new legislation, the technology has often changed again. And let’s be honest, Congress’s recent hearings grilling Tik Tok CEO Shou Zi Chew demonstrated the painful reality that many of those responsible for writing digital rules and protections often don’t know much about it. Sometimes, the law does adjust, but not usually quickly or fully. There’s a reason Silicon Valley has a Wild West reputation.
How technology laws affect your business depends heavily on your relationship with the digital world. Companies that only consume technology, such as hospitals or banks, need to know different technology laws than businesses that create and sell it.
Most businesses use technology without creating it and fall into a myriad of tech law problems, like those listed in this article from Systems X. Your business may be a part of conventional user categories like:
- Medical and dental practices
- Law firms
- Restaurants and bars
- Retail stores
- Banks and other financial services providers
Even as a user of existing software or hardware, you will need to think about privacy and data security, like:
- How you collect, store, and use personal identifying information like names, addresses, and Social Security numbers from those you can collect it from and those you can’t.
- How you secure financial information like credit card numbers and PINs and what safeguards you must take under laws like the Gramm-Leach-Bliley Act (1999).
- What you must do to detect and mitigate data breaches, even when the laws still governing data surveillance (like the Electronic Communications Privacy Act of 1986) were written before the internet’s novel invasions.
While there is some assistance out there for businesses to learn about the digital world (like the Grow with Google Digital Coaches program), they usually focus more on marketing or data analysis than they do on legal issues. Unfortunately, as the Global Legal Group explains, “there’s no single principal data protection legislation in the United States” to make the layman’s understanding of it more accessible.
To navigate the minefield of 21st-century data laws, these businesses should work with legal counsel who is knowledgeable about technology to identify their risks and develop a risk management plan. In many cases, you can push the responsibility for compliance with these laws and regulations onto your suppliers and service providers in your contracts with them.
- The Tech Creators: Your Business Creates Technology
Businesses that create technology will typically deal with two areas of law.
Intellectual property laws help you as a technology creator protect your:
- Proprietary processes and manufacturing techniques
- Written texts
- Confidential business information and trade secrets
If someone misappropriates or misuses your technology, you may be able to use intellectual property laws to stop them. And correctly patenting and protecting your IP can even serve as a deterrent against potential violations.
Disney’s IP protections, for example, are notoriously terrifying. Whether you love them or hate them, Disney’s millions of dollars of legal investment in copyrights, trademarks, patents, distribution rights, character rights, and more has protected their valuable intellectual property and earned them billions. And Disney is just one example of the businesses who defend their brands and their inventions.
Since you provide technology products, your customers will expect you to meet all the regulations that govern those products. These statutes cover everything from workplace safety regulations that ensure your products are not hazardous to data privacy regulations that determine how you gather, transmit, and save certain information.
For an excellent non-lawyer overview of the latter, check out this Wirecutter article from Thorin Klosowski, “The State of Consumer Data Privacy Laws in the US (And Why It Matters).”
As one example, U.S. law restricts the export of some information technology products because foreign governments or even terrorists can use them to create weapons. If you plan to sell your products outside the U.S., you will need a technology lawyer to review these export controls and make sure your products comply with them, minimizing the risk of investigations by the Department of Commerce.
- The Digital Servicers: Your Business Offers Technology-Based Services
As more people gain access to high-speed internet, the field of technology-based services has grown rapidly. Service providers often blend the other two categories, being both casual users and tech creators.
For example, video conferencing service providers, like Zoom, Microsoft Teams, or Webex, frequently use off-the-shelf video calling technology. But they may also provide unique services like scheduling, virtual backgrounds, and file sharing that they must protect. Just last month, Zoom had 8(!) patents approved for their digital meeting technology in areas like “Moving content between breakout rooms” and creating “Unique watermark generation and detection during a conference.”
As a result, digital servicers need to be aware of all areas of technology law, including:
- Data privacy
- Financial security
- Intellectual property
- Artificial Intelligence
- Automation, and more
If you offer your services in international markets, you must also comply with the Dept. of Commerce’s export controls. And many foreign governments have been much more protective of data privacy than the U.S. government.
As a result, your business may need to implement additional security measures to comply with data privacy regulations in the European Union or South Korea. Bloomberg Law published a detailed article charting the differences in the privacy laws between the EU’s General Data Protection Regulation from 2018 and the only three US states (as of the date of this post) that have enacted comprehensive privacy legislation: California, Virginia, & Colorado.
More importantly, companies like yours often work at the cutting edge of technology. You will need a technology lawyer to review your service offerings to determine how existing laws apply to your business and how to protect your future work in the digital world.
How Does Technology Law Apply to Your Small Business?
Whether you are an early tech adopter and innovator or prefer living off the grid like our Amish neighbors, the new technologies of the 21st-century touch almost every business. To discuss how technology laws may apply to your small business, message us here. We’d love to talk about it with you.