Newbies
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You've decided to take the plunge into the adult Internet industry and are now wondering what you need to do to protect yourself. Below you will find a brief explanation of various types of adult businesses you might be pursuing from a legal perspective. Many of these topics are covered on our article pages. If you see a word that is highlighted, you can click on it to learn more about the subject.

To simplify matters, we have put together "Legal Packages" that include all of the relevant legal items for each subject. Each package will be tailored to your particular situation. If you see something you are interested in, simply contact us. Please note that the topics covered below are only a few of the many options in the adult industry. If you are pursuing a business idea that is not listed below, feel free to contact us to discuss it.

Newbie Legal Issues

Will My Idea Work?

Before you start spending time and money on your adult business, it may be wise to have an objective third party review your plan. Frustrated clients that have spent many months trying to develop their business often retain us. Within an hour, we are usually able to identify any number of areas where they have gone wrong. If you return to the initial page of our site, you will see a testimonial noting such a situation. As a result, we have decided to offer a service wherein you can have your plan reviewed. Obviously, no one can predict if you are going to succeed, but we can alert you to any obvious problem areas in your plan.

Will AIL Review My Site?

Yes, we review sites frequently to make sure they are complying with relevant legal requirements. Simply contact us to discuss your particular situation.

Shooting Content

If you intend to shoot content, we strongly suggest that you incorporate to protect yourself from some kinds of lawsuits filed by models and third parties. Regardless, you absolutely must have all models sign a "model release" and obtain two forms of identification showing that they are not minors in addition to determining every name ever used by each model of each sex. . These model releases are your "stay out of jail" card. You must keep your model releases at your primary place of production, which is typically the studio you shoot in or the area you do your editing. You must establish a data retrieval system indexing by all of the names and the title of the "work" in question. We will gladly assist you in 2257 compliance. Remember, that an obscenity prosecution is complicated, but a prosecution for violation of 2257 is comparatively easy, that failure to abide by the law, even with adult models of advanced years living in assisted living, can shut you down and put you in prison for five years.

Do you need a permit to shoot content in your location? It depends entirely on your location. Some counties require permits and others do not.

Legal Packages for Content Businesses:

If you are pursuing a content production business, the following items are suggested as an absolute minimum. Your particular business plan may require more items.

Model Release: Delivered in Word format and may be reused as you need it.

Corporation: Create a barrier between your personal assets and lawsuits from models and third parties.

18 USC 2257: Mandatory Statement for complying with Federal Law Selling Content

Once you have your content, you can use it for your own site or distribute it to third parties. If you decide to distribute it, you have three basic options available. Initially, you can sell the content outright to another party. Your second choice is to lease the content to another party, for instance an existing site, and charge them by the amount of bandwidth or data used. Finally, you can license the content to a third party and get paid royalties based on any number of income producing methods. Whichever direction you decide to go, it is vital that you have a contractual agreement with the third party. The contract will cover such subjects as where the content can be used [only in the member section?], how it can be used [on banners?] and for how long.

As an example, assume that you have agreed to supply your content to a Webmaster for a new site. You have agreed to split the profits equally. Seems simple enough. What happens, however, if the site fails or you don't get along with the Webmaster? Do you get your content back or can the Webmaster continue to use it? Can you terminate your agreement with him? A contract covers these issues at the outset of the relationship and locks in your rights. If you do not have a contract, a court will have to decide who is telling the truth. Oral promises are worthless from a legal perspective. For more information on contracts, just contact us.

Sites

If you are going to develop a site, there are a number of factors that come into play. A central issue is whether you or an investor is concerned about being personally linked to the adult site. If you are not concerned, then the legal steps are fairly simple. If there are concerns about someone identifying you or an investor participating in the adult industry, it gets a bit more complex.

We Don't Care if Anyone Knows We Have An Adult Site!

In such a situation, we recommend that you incorporate to protect yourself from personal liability. If you are going to shoot your own content, you will need a model release. If you intend to buy content from others, you will not need a model release. You will, however, need to verify that they have model releases as well as the location and name of their custodian of records. Once you are past these issues, you will need the following items for your site:

Incorporate - Protect your personal assets by shielding yourself from personal liability.

Warning Page - Warns the viewer regarding adult content

Custodian of Records Statement - lists the location of the model releases

Terms & Conditions for Members. - Defines what members can and can't do.

Privacy Policy Statement - Becoming major issue on the net. Tells the viewer what you will do with their information.

In addition to the above, you may decide to promote your site with an affiliate program. If you go with an affiliate program, you will need Terms & Conditions for the program. The affiliate terms and conditions are vital to your success, as the language will establish that you are not entering a partnership with the affiliate, a legal situation that can lead to disaster. The language will also define how the affiliate will be paid, acceptable marketing practices and other incidentals to your relationship with the affiliate.

For The Love of God, Nobody Can Know We Have an Adult Site!

What if you or your partners wish to avoid being publicly linked to the site? Remember, State filings for most business entities list the shareholders or officers of the business as a public record. One method for pursuing your adult business without risking your public persona is to follow a double incorporation strategy. Read about this strategy under "business entities" on our Articles page. To pursue the double incorporation strategy, you will need two corporations, a loan document and a management contract. Once you have these, you will need the documents listed in the previous section.

The use of a nominee corporation is a second method for effectively hiding the identity of the shareholders of the site. This strategy incorporates the use of a third party as the public face of the company. The third party will be listed as the shareholder and officer of the company on all public documents. Depending on the amount of anonymity you are seeking, this person will even sign business loans for the company and register the company with the IRS.

So, which option should you choose for your adult business effort? It really depends on the specific issues involved in your situation. Feel free to contact us to discuss your particular situation. All initial consultations are conducted free of charge.

Do you have questions? Are you looking for other information? Contact us - richard@adultinternetlaw.com.

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