#286: Legal Tips for Small Businesses with Andrea Sager, Founder of Andrea Sager Law

It's episode number 286 with my friend Andrea Sager, who is All Things Legal. Not only is she an attorney and a former boutique owner, but she can talk you through all the legal struggles in this industry. Get ready for a great interview. Let's talk about your business strategy and the juicy details of what actually works from mainstream fashion to fashion on Main street and the entire ecosystem behind it. How do we scale your company and do it with the balance and the happiness that we all seek Week? Let's hear from those insiders, experts and strategists that actually make it happen. I'm your host, Ashley Alderson from the Boutique Hub and I can't wait to chat. Several years ago now, I first met Andrea Sager, who was a boutique owner inside of the Boutique Hub when we very first got started. And at the same time she was making her way through law school. Once she graduated law school and became an attorney and and the more we began to visit, it became so clear that there was such a huge need for trademark help and really industry specific help for both boutiques and wholesalers in our industry. Soon after, Andrea's business absolutely took off as she began to help people in our industry name their businesses, create trademarks, deal with some of the common legal issues that came up. And after she started her own membership program called the Legal Printer, which today she does full time. No longer having a boutique, but still full time in the industry, Andrea helps growing business owners, brand new and well established, protect what is legally theirs. Join me in the conversation with my friend Andrea today as we talk about copyright infringement, trademarks and some of the issues that seem to really plague our industry today and how you can protect.

Your business for the long haul. Hey guys, get out your pens and paper this week class, because you're going to want to take notes. On this week's episode. We I'm joined by my friend Andrea Sager, who has been a longtime member of the Boutique Hub, honestly, since before the beginning, I would say boutique owner who went to law school, who has an amazing business serving our industry with all of their legal needs. So Andrea, thanks so much for joining me today.

Thanks for having me. I'm excited to do this and I gosh, yeah, it has been forever, I feel like since I've been part of.

The Boutique Hub, yes, from the very early beginning. So I love that we get to have this conversation and the way that you serve your clients today because you fully understand the business, because you've walked in everybody's shoes as a Retailer yourself, but now you serve them on such an important level. I think sometimes legal can be so intimidating to retailers, like the thoughts of having to hire an attorney and the expense and does the attorney understand my business? But you really, you know, you serve a definite niche today. So I'm excited to pick your brain. Sound good?

Thanks. Yeah. And I feel like I owe a lot to the boutique hub, because I feel like if it wasn't for the boutique hub, I wouldn't be where I am today. So, yeah, I'm excited for this.

Oh, man. That. To hear those stories. Honestly, before we even get started, I just have to tell you this. You know, our mission at the hub is to serve boutique owners, obviously.

Right.

To serve our entire industry. And my mission has always been around changing people's lives. I know when you change a business, you change a life. You change a team, you change a community. Community. But it's not just boutique owners. Like, I think about your business and so many service providers that we work with that have been shaped because this community of boutique owners came together. So I think it's so cool to see that come full circle.

Yes. I love it. And seriously, like, the boutique hub, I feel like it has shaped a ton of businesses, which is incredible, man.

Love it. All right, well, give me the backstory. Andrea, talk to me about the boutique first, how you came into that world and then your transition into legal.

Yeah. So I. Funny story. I started on Poshmark and I in college. I was not, like, the, I guess, quote, unquote, broke college student. I was in the army. I made a lot of money in college, and all of that money was spent on clothes, usually from express. So my whole closet was full of express. But when I left college, I went to law school, and then I was broke. I was officially, like, the broke law student. And I was just like, man, what am I going to do? And then I was like, okay, I have all these clothes in my closet. I had learned about Poshmark. This was right when Poshmark started. So I was really with Poshmark from the beginning, and I started selling my clothes on Poshmark. And then I started seeing all these people on Poshmark selling boutique clothing, and I'm like, how do they. How are they doing this? So then I started looking into it, and I realized, oh, my gosh, I can start my own boutique. I can sell on Poshmark. Well, then, like it for me. If I'm going to do one thing, then I like, I go all in. So then it wasn't enough for me just to sell on Poshmark. I then knew I needed to create my own website. So I started my own website on Shopify. And my first site was done by myself. And then luckily I was, I, I got to the point where I could. I hired a designer and developer to create me a new site and I had the boutique, I guess, let's see, about three years and we opened a brick and mortar. And then it got to the point where I was just kind of burned out and I got the big firm job in law school. So I thought I was set for life. My, my plan was, okay, I'm going to work at this big firm. I thought I, you know, I thought I was set for life. I'm like, okay, great, I'm making the big bucks. I'll make the all the money here and then I'll run store. Like I'll just own the store and have somebody manage it for me. Well, I did not do a good job at all hiring and having somebody else like run the store. So honestly, like when I was at that big firm, I was doing two jobs, which was not cool, not fun. And I got burned out. And then I hated the firm I was at. So on top of all of this, I hated it. I absolutely hated it. And luckily with the boutique hub, I had other boutique owners coming to me at the firm and saying, hey, I need help with copyrights and trademarks. Well, when I was at the firm, I wasn't doing intellectual property. And, but, and most of the time, most of the boutique owners couldn't afford the firm's rates. But then I did have a couple of clients, a couple of boutique owners that were like, you know what, I don't care what the fees are. I just need to get, you know, a registered trademark. I'm like, okay, well, you know, we'll onboard you here at the firm. And so here I am, this first year attorney thinking I'm an absolute rock star, killing it. Like I'm this first year attorney bringing in these clients and I, and I kid you not like I was on a high, like flying high, thinking they're going to love me. And I remember clear as day, as part of the onboarding process, one of the partners has to like informally approve the client. And I, what I was always told is this is just like an informal process. They just have to make, you know, just clear, you know, just check a box. Well, this partner literally came to my office and told me to my face, like, we don't want this client. Like they're not a quality client to us. And that just broke my heart because I remember this boutique owner. I think at the time they weren't a million dollar business, but they are now. And at the time they were a multiple six figure business. And I'm just like, what do you mean? Like, there, there's this huge business. Like in my eyes they were a huge business and they were going to pay the fees. They didn't have an issue paying the rates. And I just didn't understand, I didn't get it. And I'm like, what the heck? Like, I. I mean, I have all of these boutique owners reaching out to me at this firm. Most of them can't afford it, and then the ones that can, like, the firm doesn't even want to serve them. So I knew that there was this gap between quality legal services and small business owners. And from that moment, I was just planning my exit to leaving that firm. And I remember clear as day, my husband and I were planning, we're in Cincinnati at the time and we were planning on moving back to Houston. Our house was for sale and it was a Wednesday and I was texting my husband, I was like, I hate this place. I'm ready to quit. I was like, I have enough money to hold us over until we move. And. And he was like, just wait until we have a contract on the house. That was a Wednesday. Friday, two people, like two partners come into my office and they fired me. And like, it took everything in me not to smile because I knew, like, you want to talk about manifesting? I feel like I manifested being fired because I knew that if they came and look, because I'm like five minorities rolled into one. Like military, Hispanic, female, like, you name it, like I'm a minor, like I'm the minority. Everything rolled into one. So I knew they had to offer me a severance package. So they did. I got like three months pay and you know, I, I could just leave. So I was like days away from quitting and instead they come and fire me and I get money to leave. So everything. Yes. And everything just fell into place. And at that time we also, I was also looking for a buyer for the boutique and nothing had happened. And you know, I had people interested, but it just wasn't working out. And, and literally within days, like that Friday I got fired. That Sunday, our house sold. That next Monday I had a buyer for the boutique and it just all fell into place. And so I knew I was doing the right thing. And I remember that Friday I got fired. And I posted in the boutique hub, like, hey, I'm officially on my own. And immediately, like, I had a client. And I was like, okay, this is it. Like, I know I'm doing what I'm meant to do. Hmm.

Man, isn't that amazing how life works out when you're intentional about, like, this is the direction I'm gonna go?

Yes. Like, it was. It was so crazy because at the time, you know, it's like, okay, well, I think I'm doing the right thing. I think I might have clients, but literally, like, one thing after the other just fell into place, and it's. It's been magic ever since.

That's awesome. All right, so fast forward to today. You're serving tons of boutique hub clients, but I know you're taking clients, obviously, outside of the boutique hub as small business owners. And I feel like we get tons of questions every single day about legal. So let's kind of go through some of the most commonly asked questions you get. Sound good?

Yes. Let's do it.

Okay, let's start at the beginning. Everyone who's starting a business has to choose a business structure, a legal entity. How do you recommend boutique owners get started in choosing the right entity?

Yes, great question. And my answer will most likely be different than most accountant or CPA answers. And that's because your accountant or your cpa, they're concerned with your financial picture. I'm concerned with your liability, and I. So as a general note, I think all small businesses should be a limited liability company, an llc. Now, when should you do that? Your. The answer will vary. You know, if you go to any Facebook group and ask the question, you'll get a million different answers from people who are not attorneys or accountants. But my answer is that you should do it as soon as possible, because if you don't have that protection, anything can happen. And it's not retroactive. So let's say. Let's say you open your business on day one, and, you know, you're just a sole proprietor. You don't have official. You don't have an official entity. Day two, you blow up overnight, and you're making a million dollars. Well, then day three, you decide to file an LLC because you're finally making money. Well, let's say on day one or day two, you did something that causes your business to get sued. Well, guess what? That LLC is not retroactive to day one or day two. So it doesn't matter that you filed on day three, because if they get that, if they sue you and they Get a judgment against your business. Well, it's a judgment against you. And they can come after your personal assets, your house, your car, whatever you own personally, they can come after that on top of your business assets. So you need to be an LLC as soon as possible because you never know what's going to happen.

Oh, so important. So just to reiterate, a lot of people get started like, oh, I'm just going to use my Social Security number. I'll be a sole proprietor. But you are my, my father in law's insurance agent. So I feel like we come from the world of like risk mitigation.

Exactly. Yep.

And it's, and it's easy. Talk about the process of signing up as an llc. It's pretty affordable. Not a difficult process to walk through.

Yeah, this is definitely something that's figureoutable. Definitely something you can diy. And all you have to do is. I tell, I don't have like the official website. I just tell people, look, Google your state plus Secretary of State. And so like Texas Secretary of State or Texas LLC filing, make sure you go to the actual government website, not legal zoom or whatever pops up. Go to your state's government website, which is the Secretary of state's office. And they are very, very helpful helping small business owners get everything done correctly. So typically they'll either have videos or very, you know, very step, you know, step by step. And if you still need help, you can call the Secretary of state's office. And every single one that I've heard of that when people have called, they've always been extremely helpful. So if you, I know boutique owners were always, you know, we're always balling on the bud. Don't have all the, all the money in the world. So if you're diying, it's definitely something that can be done on your own. And it's 100% figureoutable. The fees vary according to what state, and they range from $50 up to like $800. California, you have to pay your 800. You know, it's $90 to file, but it's, you have to pay your $800 franchise fee every single year. Texas is $300. Hawaii is 50, Florida's 100. I'm just going off of what we've done lately. I would say most states are about $100 for the filing fee. Perfect.

Not that difficult once you get that started. Actually, before you get that started, I should ask this question first. I know your name is critical and so many people come up with this great name and maybe they Google it. They don't. But that can get you ton of trouble down the road. Talk to me about the importance of choosing the right name.

Yeah, this is. So this is my bread and butter. Trademarks, this is. Trademarks are what identify your brand. So number one, your brand name. And at the, at the end of the day, it doesn't matter what your LLC name is. I mean, you could have xyz, llc and then once you decide on the actual boutique name, you can file a DBA under that LLC and you'll still have the LLC protection. So you can have multiple businesses, you know, most people know, like the umbrella structure. So you can have multiple DBAs under one LLC. Now choosing the name, there's a lot that goes into it and you need to make sure that you are doing as thorough of a check as possible on your own. And then you still need to do a trademark search with an attorney to make sure that you're not infringing on somebody else's trademark. Because trademark infringement doesn't occur. It doesn't just occur when it's the same exact name. Trademark infringement occurs when there's two names that are so similar offering the same or similar goods and services. So when the services and goods are similar and then the names are so similar that they're likely to cause confusion with consumers. So if somebody shops with, you know, the person down the road and thinking that it's you because the names are so similar, well, that's trademark infringement. It doesn't matter if it's, you know, a different name, as long as they're similar enough, then it's trademark infringement. So adding the to the beginning or adding shop or boutique to the end, none of that makes a difference. If it's similar enough to cause confusion, then it's infringement. So for example, my, my brand name is Andrea Sager Law. If there's an Andrea Sager Legal, that's infringement. Andrea Seeger Law or legal, that's infringement. Any different spelling of my name, that's infringement. So any formative of the words, that's definitely infringement. So you have to be careful to not just look out for the same exact name. You need to look for anything similar, but you still need to do your own searches on your own. So absolutely search domain names, search Google, search social media, search everything that you can, but just know that it's still not enough because it could still be infringement because there could be a name out there with a different spelling. So one, one client that comes to mind, she's a boutique Owner. I don't think she's part of the Hub, but her, her boutique was Soul Honey, and it was Soul S O U L Honey H O N E Y. Well, she ended up infringing on somebody else who was Soul Honey H U N N Y and she never found. She's, she's like. I searched everything. I searched Google, I searched social media, I own the domain name. How is it infringement? And it's because it's the same phonetic word, even though it's a different spelling. And they are both clothing stores. So that's why it was infringement. And that's, and that's just a prime example of why your search isn't enough, because you don't know what else could be infringement.

So helpful. So, so it's important to look out for what everyone else has, right? Doing that search. But what happens when you find someone else? Let's say you've been in business for five years and now you find someone else using your name. Like the opposite of that. What are the next steps you take in order to protect your name when you find someone else using it?

Well, hopefully you have a trademark registration. If you have the registration, the enforcement process is super simple. All you have to do is reach out and say, hey, you know this. And you can do this yourself or hire an attorney, either way. But if you reach out and they ignore you, or they say, oh, whatever, I'm not going to change my name, or, you know, if, if they say, okay, well, you know, have your attorney contact me, whatever, if they just ignore you, you don't even have to hire an attorney. All you have to do is go to whatever platform they're on, whether it's, you know, their website's hosted with Shopify or WordPress, or on social media, you just have to go to that platform where it's hosted and submit a trademark takedown claim with them. But you have to have the federal trademark registration in order for them to act on it. And you don't even have to have an attorney involved. You just have to have your federal trademark registration. So I've been trying to really preach about the power of a federal registration, because you don't have to even hire an attorney to enforce your trademark. You just have to petition Facebook, Instagram, Shopify, WordPress, and they'll act on it, because if not technically, you could sue them for trademark infringement. They don't want to be brought in all these cases. So they, as long as they act in good faith and act on any claim that's brought to Them, well, then they are like, they're free of liability. That, like the courts have said, hey, look, if. If they make this claim with you and you act on it, then you're fine. Same goes for copyrights now. And I don't want to get into the copyright game because we could talk about that all day long. But with trademarks, you do have to have the registration for the platforms to act on it. So let's say, you know, you've been in business for five years, you. You have your registration, and you see somebody with a name first. I would reach out because if. If you submit the claim, they'll just completely remove the page. Remove their page.

You gotta be super careful with that.

Yeah, they'll absolutely remove it. And I know it happens all the time to boutique owners that post stuff unknowingly. So I always tell my clients, look, if I would just reach out first in good faith, let them know, hey, look, I own this registration. Show them your certificate, and hopefully they'll remove it. If not, then you, you know, if you don't want to hire an attorney, you can just submit that claim.

Right. I think you make a good point, though, and I want to highlight that, like, that's a really powerful step to take. And I think a lot of times, I guess, from what I've seen in the hub, anyway, it's kind of like you were saying about your client soul, honey, a lot of times people may infringe and they might not know they're infringing. Like, I like to give people the benefit of the doubt, so the more you can reach out ahead of time and be like, hey, I'm not trying to be a, you know, a jerk here, but, you know, it is what it is. Can we please work together? Here is a, you know, proposed time frame that you can use to change your name and your social handles and branding and all that, because it does take time and then ask them nicely, and that's not a fun thing to hear. So I think kind of being aware of the hard news that is for someone to receive is helpful once you start to take that step forward.

Yeah, absolutely. And if you don't have your registration, then it's a completely different story. Right, Hope. I mean, hopefully if you've been in business for a while and, you know, like, okay, this isn't just a hobby. Like, I have a real business here. Hopefully you've taken those steps to get the registration, but if you haven't, then your options are limited. Number one, I mean, you first most. I mean, if you reach out to them and you say, hey, I was in business first, most of the time they're going to ignore you. Because if you're taking your business serious enough, why don't you have that registration? Why? You know, why haven't you taken the steps to get that registration? If you are saying, hey, I'm in this business, owner, I've had this business and people, I hear it all the time, they'll reach out and they ignore them because they don't have a registration. Even though you do have rights, but your rights are very limited until you get that registration.

Very helpful. Okay, let's talk about how to use that registration on something more than your name. What else can you protect in your business?

Yeah. So as long as it, I like to tell people if it has a unique name within your business, then it can probably be protected with a trademark. So on top of your brand name, you have your logo, your slogan, if you have a podcast name, if you have a product name or a product line, all of those things can be protected with a trademark.

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Perfect. How about the content on your site? Sometimes we get boutique owners that say so and so came in and copied all my product descriptions and my about page and whatever else. I feel like we've seen it. All right.

Yeah, exactly.

On my website. Talk to me about that's not trademark, but how do you protect what's on your site?

Yeah, so that is copyrights. Copyrights protect your content. So think you know the everyday. So the content on your website, your blog posts, your photos, your videos, your, you know, your product descriptions, your designs. So you can, you can enforce those the same way online by submitting a takedown request. With all the platforms, luckily with copyrights, you don't actually need a copyright registration because you ha. You automatically have rights the moment the work is created. But you cannot sue unless you have a copyright registration.

Okay, and is that on your site? Is that called the dmca? DMCA Takedown?

Yes.

Okay, tell me more about that.

Yeah, so the, it's the Digital Millennium Copyright Act. This was enacted early 2000s or 8, late 90s, and for this exact purpose for. And it, it really came about because of photographers and their photos constantly being stolen. But more than photos, you can enforce anything online. And we actually have a full program for our clients that we monitor their designs online, looking for infringements of their designs. And all we do is submit takedowns for them because, you know, I've gone the route of, you know, sending the cease and desist letters, but most of the time it's, you know, Susie Homemaker who started her business yesterday and who doesn't understand copyright laws. So I don't want to force my client to have to spend, you know, a few hundred dollars on every cease and desist letter that we send out.

Yeah.

Instead we just go the more efficient route and submit a takedown request online. And you know, of course we get backlash, but at the end of the day, like there's only so much you can do. And you know, if they were being the responsible business owner, they would know that it's not okay. Like you're doing everything you can to police your work. You can't. You literally, like some of these clients, I mean, I'm working with million dollar T shirt companies here who literally have thousands of people infringing on them. They can't reach out to every single one of them.

Right.

Like, why. Why is it on them to be nice to the other people? And, I mean, they are being nice. They're not suing, which they absolutely could, but it's just not worth it.

Yeah, that is a whole nother animal. Let's talk about next. Oh, my gosh. Our T shirt community, first and foremost, like, oh, I got to give them props, because it is a roller coaster keeping up with who's created what design and who's knocked them off. And there's this, like, perception of if I change the design 20%, then I can knock them off, which is complete crap. So don't ever believe anyone who tells you that. I think I could, like, follow up with 55 questions on just this topic alone. But let's. Let's start here. Talk to me about the importance of protecting your designs if you're a boutique owner or if you're a wholesale brand creating T shirt designs. And as a boutique owner, when you're buying from wholesale brands, how to know if you're getting originals or knockoff?

Oh, man. Good questions. Oh, okay. So as the T shirt designer, you always want to be original. And sometimes this is hard because at the end of the day, nothing is original. Everything is inspired from something. But you have to be original enough. And I'll tell you so the law for copyright, Copyright infringement is substantially similar. So if one design is substantially similar to the next, then the second one is infringing on the first. But how do you know if it's substantially similar? I don't know. Nobody knows. Nobody knows. And the thing is, nobody likes to sue on copyright claims. And that's why there's not a lot of, I guess, precedents, because nobody wants to sue because nobody knows what the outcome is going to be and going. And I hate to bring this up because we could go down a whole nother rabbit hole, but this is why I think Louis Vuitton hasn't sued, because they don't know what the outcome is going to be, and they don't want to open that can of worms if they lose. So. And the Louis Vuitton thing, that's a whole. That's a trademark issue. And I mean, there's so many nuances there. And I feel like we could talk on. We'd have, like, five podcast episodes about all this.

Well, start.

Start here, though. Andrea, make sure we talk like that's. We're talking Louis Vuitton. Like, if you upcycle a purse versus Louis Vuitton when you buy a whole roll of fabric with the Louis Vuitton logo on it, like that's a different, that's a different thing. That is.

Let me, yeah, let me go ahead and clarify that. So if you create a T shirt with Louis Vuitton with the Louis Vuitton logo, or if you are using a fake Louis Vuitton bag to create the new products and upcycling, that is illegal, that is counterfeit and Louis Vuitton will sue you for that.

And we've seen that happen. We've seen those letters happen.

Yes. However, what's iffy and what nobody knows if it's okay or not is using an authentic Louis Vuitton bag to upcycle it to add fringe or, or to cut up an actual Louis Vuitton bag and create a new product. If it's authentic and you create a new product, that's what Louis Vuitton has not sued on. And I mean, I know it's because they don't know what the outcome is going to be. I mean, you can look up, I mean if you Google right now, Louis Vuitton, you know, counterfeit lawsuit, I mean, they'll sue you all day long because it's counterfeit and that's 100% illegal.

Right.

What's not a slam dunk for them is people upcycling and even buying a brand new Louis Vuitton handbag just to cut it up and create new products. Like Louis Vuitton doesn't know whether that's illegal or not. So they're not, they haven't sued on it. Are they going to? I have no idea. I don't, like, I don't think they want to be. I mean there's people making millions of dollars doing this and if they're going to sue somebody, they're going to sue those people. But they haven't done it yet because they don't know what's going to happen. And if they go, if they sue and they lose, well, guess what? Like the floodgates are open.

Yes, exactly. So talk to me about, because we've seen so much of this happen. So there's been a lot of discussion inside of the boutique hub. But talk to me about what you have seen as far as those that are doing counterfeit that have had their entire social media presence erased.

Yeah.

And business was lost because of it.

Yeah. So if you're selling counterfeit material and, and this goes for any brand. I know the cowboy, the Dallas Cowboys are a big one. They, they are big enforcers on their brand. If you're selling any type of counterfeit material, they will submit that trademark takedown online. And like I said, like we said, you don't, you get no notice. You get no notice. Facebook, Instagram, they just remove your page. So if you have a million likes or followers on Facebook or Instagram, guess what, all that's gone if you're infringing on their trademark. So if you're selling actual counterfeit material, then it's like you're done for. And so how do you know now when it comes to the bigger brands that have the actual trademark? So, you know, Louis Vuitton or Dallas Cowboys, especially when it comes to Dallas Cowboys, you need to ask, hey, do you have a proper license to be selling this? And if they do, they should be more than happy to show you the license. If they don't, then I'm sure they're not going to show you. Or they'll say, yeah, yeah, yeah, it's, you know, it's authentic, like, we can sell this. Or I don't know, I don't know what they would tell you. But if you don't, if you ask for proof that you're authorized to sell and they don't show it to you, I would not sell it. Now, when it comes to Louis Vuitton, a lot of that goes off of reputation because I don't want to name any names, but I know there's been a couple of brands out there, wholesalers selling, you know, the upcycled Louis Vuitton products. And it turns out that they weren't actually authentic Louis Vuitton products. And those people are getting in trouble. I've been, I've actually been dealing with a couple of those people that have been getting those letters. And at the end of the day, I tell them, look, you just have to put the liability off of you and say, look, I was told by this person that it was authentic. So, you know, put, put it back on the other person. Which, again, I don't know if they would actually sue a lot of the smaller boutiques, but I know there are people out there making millions of dollars upcycling Louis Vuitton products, and those are really most likely who they want to go after. But I mean, at this point, Louis Vuitton's game is just to send, you know, a wave of letters and, you know, hopefully some of the people will stop selling. But, you know, if they were, I mean, I don't want to say if they were going to sue, they would have already sued. I think they're just trying to find the right time or, you know, maybe they won't ever sue because they just don't know what would happen.

Right. And I think it's important to note, as you were saying, like, there's some that have sold counterfeit. There's others that we know that video. Every bag that's cut up, they have all the proper ID numbers, and they're very diligent about making sure they're doing it the right way. So I think what you said earlier as it relates to licensed goods. So whether it's like a Dallas Cowboys thing or a band tee or whatever, where you're using someone's likeness and logo is to always ask the wholesaler for identification, for paperwork, like actual legal proof that you can be using these items versus just going off of their word. Because we've seen that go south pretty fast.

Exactly. Yep, 100%.

So talk to me about. I think there's probably people listening, saying, hey, Andrea, what's the difference between having licensed goods versus, say, trademark goods?

Yeah. So the. So the licensed goods, that license comes from the owner of the trademark or the copyright. So when it comes to a band tee or the Dallas Cowboys, they're licensing their trademarks to be able to use that brand identity to sell their own products. Now, when it comes to copyrights, typically that's for. Gosh, my brain just went blank. Like a tv, like a ban logo. So logos are something that can be protected with a trademark and a copyright. Maybe they're licensing the copyright. So. Or if it's, you know, a cute actual design that's protected by a copyright, that is something that can be licensed. Now if you own the trademark or the copyright, you can then license that to other people to sell. And this is where I try to get clients to understand, look, this is. I mean, this is what you're after is getting that passive income through licensing. Like, think about Disney. Disney makes billions of dollars a year by licensing their intellectual property. Billions of dollars a year just. Just through licensing. Just by telling people, yeah, you can use this. Pay me for it, though. So I'm trying to get a lot of my brands to understand, look, create. You know, once you create this brand and you create this brand identity, then you can license your materials out to other people.

Absolutely. Take this another step further. There is a huge trend today of transfer sales happening inside of, primarily on Etsy, where someone says, oh, I've got a Cricut, or I've got whatever. I'm going to start making my own T shirts and I'm going to go buy these transfers off of Etsy. Talk to me about the risks associated with that and how to mitigate them.

Oh man, Etsy, they are a breeding ground for intellectual property infringement. So if somebody tells you that they are licensed, that they have a license to sell because they purchased it off of Etsy, that is alarm number one. Do not believe anybody that says they purchased a license off of Etsy. I mean, maybe if it, especially if it's for something like Louis Vuitton or the Dallas Cowboys. I promise you, neither of those brands are selling their products on Etsy to be licensed out. That will not happen. So on Etsy, people will sell, you know, the lice. You know, you can purchase this license or this transfer and you can recreate this many for five bucks. Trust me, any reputable brand, they will not be selling. First of all, they won't be selling any, any license on Etsy. Now if it's, you know, maybe it's a design that an up and coming brand has and they're licensing on Etsy, maybe, maybe that is true, maybe that is happening. But if you have a, if you find a design that you really like, you really need to reach out to the person on Etsy. So let's say you see the transfer on Etsy or the license on Etsy, reach out to them and say, hey, did you create this or did you purchase this from somebody else? Because a lot of times the people on Etsy bought it from somebody on Etsy and it just all turns out to be that they're all, it all results back to one person. But all those other people that are selling it, they're infringing and they don't know just because they trust, you know, whoever sold it to them on Etsy. But trust me, Etsy is a breeding ground for intellectual property infringement.

So be super careful with transfer sales. Whether you're a boutique owner or you're a wholesale brand wanting to, to start a wholesale brand based off of buying transfers on Etsy. You know, the other thing I think is a common question around this topic is there are wholesale Facebook groups that allow boutique owners to come in and say, hey, here's a screenshot of a design that I love. Will you please make this for me?

Yeah, that's another big no. No. Well, first of all, if it's not your photo, that's copyright infringement. Even if you're just asking, you know, saying, hey, I saw this photo and I would like somebody to recreate this for me. Well, guess what? Like, that's infringement because that's not your photo. And I know that may sound silly, but that is 100% copyright infringement. Now, asking somebody to recreate something morally and ethically, that's wrong because you want to buy from the original creator. And then depending on what the design is, that that design itself could be protected with a copyright. And so by recreating it, you're infringing on their copyright. And I'm not going to say that everybody, every T shirt designer, every design that they produce is protected with the copyright, because it's not. But if it has enough design element to it, then it could be protected with the copyright.

Right. And it's still kind of moral and ethical. Like you were saying, it's a small enough industry that word gets around like we're all small business owners trying to support other small business owners. So you've got to be careful to support, you know, those who are working hard to create original work. There is no shortcut on the path to success. Right. It's only being yourself, creating a great brand that's memorable and doing your own original work. Would you agree?

Absolutely.

All right. I've got a gazillion other things I think we could talk about, but we better skip forward on that today. You know, another commonly asked question I'm sure you get are, what are the common terms and conditions? Privacy policies, contracts, cease and desist, NDA, non disclosure, all those things. What are the most common contracts that I need as a boutique owner and how can I access those?

Yeah. So if you have a website, 100%, you always need terms and conditions and a privacy policy. Privacy policies are 100% required when you have a website. And especially with all the data breaches lately, states are popping up with new privacy laws left and right. So you have to make sure that you have a privacy policy and it is accurate and up to date. Now, your terms and conditions, that's actually the contract between you and the visitor of your website if you, you know, you're selling products. So, yes, you can also have the terms to your. Basically, it can also govern the purchase. So not only is it the contract between you and the visitor of your website, but it's also the contract between you and the purchaser on your website. Now, on top of that, if you have employees, you need to have an agreement with them. And it's not necessarily an agreement as far as you know, because I'm sure pay and terms like that, those are pretty much understood because they wouldn't, they wouldn't work for you. They didn't know how much they were getting paid. But the employee agreement is mainly for your purposes to make sure that they understand your grievance policy. You know, if they like what are reasons they can get written up, how many write ups before they get fired and the reason you need to have all of this written down, you know, what about that person that applies for unemployment or they want to sue you for, you know, firing them, wrongful termination, like all of that, all of these agreements are to protect you as the business owner. And on top of the employment agreement, I know many, many of us work with contractors and freelancers. So you always, always have to have a contract with them and don't. And I mean my number one lesson with contracts is don't think of them as a way to, you know, for one party to screw over the other. Contracts are in place because both parties need to make sure they understand their rights and duties of both parties. That's all a contract is, is just laying out the rights and duties of both parties. So when you're working with a freelancer, hopefully they provide you with a contract and hopefully everything is understood. And I know, I mean in the hub we see it all the time. You know, they working with an influencer or a brand rep. Hey, I sent them this merchandise. They never posted. They never did like okay, well did you have a written contract with them? No, I didn't know I needed one. Well, guess what, that's what the contract lays out is exact terms to make sure there's no confusion, things actually get done and things actually get done on the timeline. So what I've done is I've taken, it's about 80 contracts right now and specific to each, to different industries. So absolutely. Retail, e commerce, there's, I mean photographers, other service providers, copywriters, designers, you know, tons of online business industries. And I've thrown them all into this contract vault because I know there's plenty of attorneys out there selling contract templates, but there's there, you have to pay per template. And you know, I've just said, you know what, I don't, I don't want people to pay per template. I just want them to pay one fee monthly or yearly and they'll get all the contracts. And then on top of that I, what I've learned as a business, as an attorney for hundreds of businesses, these business owners don't get in trouble because they mean to. They're not con artists, they Just don't know what the law is. So with the Contract Vault, it's really two parts. Number one, you get the contracts. Number two, you get our members only Facebook group where I'll be teaching live every single month. And I'll be teaching an in depth legal topic and we'll be doing Q and A to make sure that you truly understand the legal side of your business, you understand the laws around business to make sure that you are steering clear of infringement, steering clear of, you know, breaking any laws and getting in trouble when it comes to your business.

So such a valuable resource, Andrea.

Thanks. Yeah, no, it's something I'm, I'm really excited about just because I, you know, being the small business owner, I've been there and even being in law school, when I started my boutique, I didn't know, I didn't know what the laws were. So even as a law student knowing I didn't know, I know there's so many business owners that a lot of the times it's an accidental business because, you know, maybe they have this hobby or I know a lot of, a lot of boutique owners, they love shopping and they love buying clothes and they decide to make a boutique out of it. And it's truly like maybe an accidental business. And yeah, they can make money, they can make money all day, but it doesn't matter if you can make money all day if you can't keep that money. And that's what the contract Vault is doing, is helping you keep your money by getting all of your contracts in place. We have brand, I mean, for E Commerce and retailers, it's, you know, employee agreements, brand rep agreements, influencer agreements, the terms and conditions, your privacy policy, working with contractors, you name it, it's in there.

I love it. Well, Andrea, we'll link it up inside of the show notes so if anyone's interested to learn more about the Contract Vault, they can catch it there. Or I know you're inside of the boutique hub often. So if you guys are members of the hub, you can also jump in and ask Andrea some questions and we will get you a link there as well.

Absolutely.

Awesome. Well, Andrea, I know I feel like our time together has flown by because all these are such important topics and we're, we totally could have swirled because we've watched so much of this unfold. I would just say this just to kind of back up everything that you've said so far. I feel like at the beginning of business you go through these stages. Right at the beginning, I did not want to Hire an attorney for anything because I was broke, broke doing everything on a budget. But the more you grow, the more you realize, like, wow, I'm really opening myself up to a lot of risk. And it becomes essential to have a great attorney that you can trust. And I know you've done a lot of work for us too on trademarks and just different issues that we've had. So I want to thank you for the service that you provide to our industry. And I just recommend. I couldn't say it highly enough and you're not paying me to say this. I just truly feel like if you are ready to grow your business and take some of these things seriously, this is a huge step in the process and you have done a great job.

Thank you. I appreciate that. Yeah. And seriously, like, I probably would not be where I am today without the Boutique cup. So super grateful as far, you know, business wise, having the boutique and now as a service provider for the boutique. Number one fan of the Hub over here.

Love it. Well, Andrea, any parting thoughts you want to share with our community today on a parting tip for success in 2020?

Yeah, I mean, you never like, the biggest thing I tell people is you never know what's going to happen. And a lot of the legal protection isn't retroactive. So you need to, you need to protect yourself up front because you know, an ounce of protection is worth pounds of cure or pound of whatever that saying is. I don't know. But seriously, if you protect yourself in the beginning, you're gon spend less money down the road defending yourself.

I love it. Well, Andrea, thanks so much for your time today and again, we'll link up everything you guys need to know to meet Andrea inside of the show notes and any day inside of the Hub. Thank you again, Andrea.

Thank you. Have a good one.

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Sam.