• Information Technology: Giving Customers the Complete Picture
  • September 12, 2004
  • Law Firm: Sheppard, Mullin, Richter & Hampton LLP - San Diego Office
  • Corporate counsel must be aware of how their companies' IT products and claims are positioned. As customers seek single-source solutions to IT privacy, security, data integrity and data management, IT companies may find it all too easy to claim their products deliver these solutions. Yet electronic data can be accessed, duplicated and used in multiple ways, or altered or deleted, whether accidentally or maliciously. Companies claiming to address every concern leave themselves open to criticism, loss of market share and potential liability for misrepresentation.

    For example, email filtering software only fends off viruses in email; separate solutions address instant messaging viruses. The Federal CAN-SPAM Act prohibits certain unsolicited commercial email, and multiple technological approaches are needed to ensure that no employee can send email to prohibited addresses. Also consider California's new Web site privacy policy law, which took effect July 1, 2004. Companies gathering certain information from California residents must post policies describing categories of information collected and third parties with whom it may be shared. Software products track Web site actions and create warnings when the privacy policy needs amendment. However, the software company must make clear that customers are also separately responsible for tracking and disclosing any sharing of data after it is transferred to multiple PCs, handheld devices and disparate software programs. Counsel can play a critical role in ensuring that their companies do not provide half-solutions or misrepresentations to customers.