Affiliates: You can be sued for what your network does

Members must pay attention; the actions of your affiliate link could get you into serious trouble. If you think that as an affiliate you can post any ad, regardless of what you advertise, regardless of the claims, you are sorely mistaken. Affiliate Networks already has a history of throwing their affiliates under the bus when it comes to lawsuits and blaming “rogue affiliates.” If you are making money from affiliate marketing, you need to examine whether your network will cause you financial harm or send you to jail.

I’ve written about this before: the legal rule is generally that publishers are not responsible for the misbehavior of their advertisers. The courts have been quite clear on this, ruling time and time again that the mere act of placing an advertisement does not make the publisher, for example a newspaper or a website, a partner in the advertisements. The only service the publisher provides is the actual “space” for the ad to display.

However, for a publisher to assert this independence, the publisher must be completely separate from the advertiser with respect to the claims and content of the advertisement. The publisher should only sell “space” to the advertiser, not be involved in any other decision. Bennett G. Kelley of the Internet Law Center explained in a brief discussion on this topic, once an editor gets more involved, “there’s a potential for more responsibility. The bigger the role you take on, the more risk you take.”

Here comes the problem for many affiliates: since they not only provide space but work as “partners” with the affiliate networks and the advertiser, they could be held responsible for the content of those ads. Depending on their involvement with the advertiser, this means that there is a very real possibility that if the advertiser and network were named in a civil or criminal action, the affiliate could also be a party to that action.

“It’s the difference between being passive,” says Kelley, “and being an active participant in the process. Once you get involved in making decisions about what the ad says, you open yourself up to liability.”

If you are an affiliate, you should examine the affiliate networks you work with. If you’ve been concerned in the past about who pays, you need to take a look at the partnership you’re creating. There has been a lot of talk in our industry about compliance from the network side, networks that vet their affiliates. However, as an industry, we must ensure that we are protecting our affiliates from “rogue networks”.

Here are some questions to ask about the networks you work with, in addition to doing your own research.

1) Has the affiliate network ever been the subject of government action? This is a sure way to know if the company has any legal problems. While the government action does not mean the company is necessarily a bad player, affiliates should examine why the actions were taken. If there are multiple complaints over time from different entities, be very careful with the company. What is going on inside that company that makes them the target again and again?

2) Have they been the subject of lawsuits alleging deceptive or other illegal practices? Lawsuits against affiliate networks are not that common in reality. Only a few affiliate networks in the last ten years have been involved in civil actions alleging illegal or deceptive practices, so if you’re working with one of those companies, you have to ask yourself what they’re doing wrong. These actions are usually against companies that like to play “both sides of the line,” meaning they want to push the boundaries, relying on good lawyers to protect them. If they name you in their lawsuit with them, are they going to defend you, pay for your lawyer? You will most likely be hung up to dry.

3) Is the owner a convicted felon or was he in jail for anything related to parking tickets? Examine the person behind the company, is he someone you’d let your kids (if you’re that old or have any) hang out with? If they’re sleeze bags that you’d be scared to let into your neighborhood during Halloween, that’s probably a good sign. Yes, this industry has several convicted criminals who own affiliated networks and even worse, registered sex offenders. It is necessary to examine the ethics of a person with respect to other people. Do you really want to trust a guy who got caught stealing old ladies their social security money with your business?

Whatever you decide, keep in mind that your decisions about the affiliate network you work with could affect you in the future. If that affiliate network gets into trouble, don’t be surprised, especially if it’s run by scum, and you’ll find yourself in trouble too.

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