Group blog agreements

Bill Sjostrom talks on TOTM about agreements for group blogs. First I suggest brushing up a little on partnership law, possibly by looking at my Law and Economics of Blogging (revision coming soon), and more optimally at Bromberg & Ribstein on Partnership and Ribstein & Keatinge on LLCs, depending on the form of organization.

Bill says that “absent agreement, 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."

That depends. But first a disclaimer:  This is not legal advice.

Now, speaking theoretically, and not in an advice mode: If the blog is a partnership, which it may be by default, then the partners’ property, including intellectual property, may be co-owned by the firm. Rights may then depend in part on whether a single member could dissolve and what happens on dissolution.

Ownership of the domain name is a little stickier, as I discuss in the paper, and more fully in the forthcoming revision.

So would the group be a partnership? Well, is it a business, which a partnership must be? TOTM doesn’t yet have ads, but that may not answer the question if it’s planning to advertise. If it’s a business, then the question is whether the members are profit-sharers.

If the members are profit-sharers, then it’s probably a partnership. Then there might be vicarious liability for, e.g., defamation suits. It also means fiduciary duties, which the members may not want.

The way out of vicarious liability is an LLC or equivalent business association, which can be formed under some laws even if it’s not for profit. But the bloggers might not like some of the implications of this, including fiduciary duties. Maybe form under Delaware law and opt out of fiduciary duties?

Can you have an agreement for a group blog that’s not a partnership or LLC? Yes, but you’re taking a chance that the court might characterize it as a partnership anyway, which argues for forming an LLC.

The ideal solution is my proposal for a “contractual entity.” See Limited Liability Unlimited, 24 Delaware Journal of Corporate Law 407 (1999).

Here’s another suggestion – a sole blog. Too late for TOTM however.

As I said, more in my forthcoming draft. And keep in mind that this blog doesn't give legal advice.

Comments

[Steve Bainbridge]

If they don;t have ads (or sold ads so as to cover costs but not "for a profit"), why wouldn't they just be an unincorporated association? (Query: which state's unincorporated association statute would apply?)

[Larry E. Ribstein]

Of course they would be an unincorporated association. But partnership is the only specific default unincorporated association, so unless they're a partnership, the default rules are unclear. They could choose to file in one of the few states that have a nonprofit unincorporated association law, and get a sort of limited liability, but I don't know why they'd do that given the ability in many states to do a nonprofit LLC.

[Robert Schwartz]

I am not sure that you need a business entity. Why can't they be co-tennants. Each one owns his own posts.

[Larry E. Ribstein]

A court might still call them partners.

[Bill Sjostrom]

Clearly an LLC is the best choice if it were costless, but it’s not. I could do the paperwork myself (I’ve done it before), but we don’t want to pay the filing fee, franchise taxes, agent for service of process fees, etc. given our blog generates zero income. We also don’t want to have to prepare any partnership tax forms (I haven’t done these before). Basically, in my mind, the costs of going the LLC route (or any route that requires filings and fees) outweigh the benefits. Hence, the best thing I can come up with is to try not to be a business association at all. This route requires no out-of-pocket expenditures because I can do the agreement myself. I realize that there is a risk a court may find we are a partnership by default. In an effort to mange this risk, as I mentioned in my post, the agreement would address this possibility. Fortunately, I think the comments to my post from my co-bloggers are building a good record that they are not blogging in hopes of a share of profits.

[jf.sellsius]

Posts by contributing writers to a blog is a form of group blog and I don't think it would be treated as a partnership.