Best Practices Construction Law : Construction Lawyer & Attorney : Matthew DeVries : Stites & Harbison Law Firm : Green Building & LEED Litigation

Does your construction company, architectural firm or development group have a Facebook fan page?  Are you worried about what advertising laws apply to a social media platforms?

The Federal Trade Commission has eliminated any question of whether liability can arise in connection with consumer endorsements for the obvious reason that consumers may rely on endorsements in making purchasing decisions.  Any third-party “claim” that a consumer derived some benefit from a product or service should meet false advertising standards, as with any other type of commercial advertising claim.  But what about when a company claims that a certain number of consumers “Like us on Facebook” - particularly where the company runs “like-gated” contests or giveaways (that require entrants to “like” a company as a condition to entry) that draw a large number of virtual “fans?”  

The tightening of endorsement regulations is reflected in the FTC’s revised Endorsement Guides issued in October 2009.  In 2010 and 2011, the FTC proved that it intends to enforce these more stringent guidelines by entering settlements with two companies who generated online “consumer endorsements” that were actually prepared and posted by affiliate marketers with financial ties to the sponsor.  See Legacy Learning Systems, Inc. File No. 102 3055 ($250,000 fine to settle charges that company deceptively advertised its products through online affiliate marketers who falsely posed and ordinary consumers or independent reviewers); Reverb Communications, Inc., C-4310( Aug. 26, 2010)(Challenging public relations agency hired by video game developers engaged in deceptive practices by having employees pose as consumers and post reviews on itunes.com web site). 

Now, in a case of first impression, the National Advertising Division of the Council of Better Business Bureaus has considered the Endorsement Guides in the context of social media promotions.  The NAD focused on what claims a company can make regarding the strength of its following on Facebook and other social media sites.  The NAD concluded that because of the various message that a “Facebook like” may convey to consumers, that "the overall message conveyed by Facebook 'like’ or the total number of 'likes' on Facebook is one of general social endorsement."  However, the NAD warned that had the advertiser presented the number of Facebook “likes” in a false or misleading manner, the claim may not have withstood NAD scrutiny and recommended that the company clarify that the number of “likes” it claimed was actually an aggregate taken from the company’s various international Facebook sites.

Companies should treat social media advertising as they do traditional forms of advertising and review “like-gated” promotions for compliance with applicable advertising guidelines.  A copy of the FTC’s Advertising Guides are available on the FTC web site.

Today's post is by fellow Stites attorney Amy Sullivan Cahill, whose practice focuses on trademark and copyright litigation, advertising review, and trade secrets litigation.

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In February, I was featured on Kevin O'Neill's Capital Thinking Radio Show on the VoiceAmerica Business Network to discuss social media business development tips and legal risks.  Well, I'm back to the radio waves tomorrow to discuss new trends in social media, including some recent missteps and use of social media in the political world.  Tune in on Thursday. 

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If you are near a computer today around lunchtime (12:00pm EST), you need to head over to the Capital Thinking radio show hosted by Kevin O'Neill.

Capital Thinking is a weekly glimpse of the intersection between politics, policy, the law, and the world of business. Capital Thinking goes beyond the typical talking head babble of traditional media to give a better understanding of what’s going on in Washington and what it means for businesses and families. Each week, the show features a mix of influential guests ... policymakers, lawyers and business leaders ... who will give you an in-depth and balanced look at issues of interest in Washington, the legal arena and the business world. This is a high-energy hour of radio that will give you actionable intelligence for use as a business leader and citizen. Capital Thinking is broadcast live every Thursday at 9 AM Pacific Time on the VoiceAmerica Business Network.

During the second half of the show today, I will be talking with Kevin about the next steps in social media.  We will talk about business development uses, as well as the legal risks and pitfalls for employers.  We will also talk about the difference between social media and social networking.

If you miss the show, you can download the podcast afterward.  Also, you can send me a question via Twitter at @matthewdevries during the show and I will try to answer it for you.

Updated: Here is the podcast link, which will be available later this evening.

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Seems like I have been doing a lot of out-of-town speaking lately.  Fortunately, my next gig will be in my own office, in front of a computer, with a headset attached.  You should consider joining me on October 13, 2010, at 1:00 to 2:30pm (Eastern) for what will be an exciting webinar:

From Paper to Paperless:

Controlling Construction Documentation,

Improving Record Management, and

Identifying Risk in an Electronic Age

The event is hosted by It is sponsored by WPL Publishing Co., Inc., the publishers of Construction Claims Advisor, Construction Project Controls & BIM Report and Green Building Insider. Some of the exciting topics include:

• “Putting it in writing” rule – what should you record? What is the hearsay rule?
• Why are proper records so essential for claims and disputes?
• Critical project documentation – what you absolutely need to document; and non-critical documentation – what you don’t need to document
• How to use project management software and Web-based capabilities to move towards a paperless project, establish good audit trail and consolidate project documentation
• Are electronic documents subject to the same discovery rules as paper documents? Is a written instruction via e-mail the same as a change order?
• How do social media platforms (Twitter, Facebook, MySpace) affect your project? Do you need a social media policy for your employees?
• AND MUCH, MUCH MORE!

If you have any great construction "war stories" that you would like to share, please send me an email.

UPDATED: If you are a regular follower of the blog and want a huge discount to the webinar, please click here for registration.  Make sure the link has "BLOGGER'S DISCOUNT".

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As many of you know, I am involved in the ABA Forum on the Construction Industry, which is the largest organization of construction lawyers in the United States and abroad.  Our Fall meeting is next week in Miami Beach, Florida.  The conference focus is “We Won’t Get Fooled Again: Lessons Learned from the Economic Downturn” and features exceptional construction lawyers offering hands-on experience the following:

1. dealing with troubled and bankrupt projects;
2. innovative ideas to assist your clients in securing payment in a tough economy;
3. cutting edge tips for drafting takeover agreements;
4. insight into where the ethical line is drawn with respect to expert reports;
5. a primer on common mistakes in reading blueprints; and
6. other practical survival tips intended to help you best serve your clients.  

This is going to be a great event (not only because of the programs and the location), but also because of the focus on social media.  Check out the following:

• The Forum is now on YouTube.  Here is a personal invite from Steve Lesser, the governing committee liaison for this program.  I am glad to see the Forum leaders catching the digital wave:

 

• The Forum will be Tweeting.  Just like Daniel Schwartz, who made headlines by tweeting on behalf of @ABAEsq at the ABA annual meeting two weeks ago in San Francisco, you can follow the tweets of the Forum's Fall meeting in Miami at @forummiami and @ABAConstruction (or using the hastag #ABACF)
• The Forum will teach you social media.   I am excited to announce that I will be teaching "An Early Morning session on Social Media," (pdf) where we will cover the basics of social media and give an overview of how the Forum intends to use the various tools and platforms.  Fellow construction Michael Murphy will also be there to give his advice on tweeting.  We hope you can join us at 7:30 a.m. for about 45 minutes on Thursday morning right before the event conference begins.

 See you next week on the sandy beaches!  I will send pics.

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Aside from some personal quiet time to reflect on the day ahead, my second favorite part of the early morning is to review my RSS fees to see what may have happened in the prior 24 hours.  It's a sickness.  I know.  

I always find at least one golden nugget of information that may be useful in my professional or personal life.  Sometimes it is breaking news about a green construction issue.  Sometimes it is strange.  And sometimes it is simply entertaining.

In any event, I want to begin sharing with you some of these TOP TWEETS, which are determined during my morning review of the prior day's Tweets and based on my sole discretion. There's no formula or selection criteria.  You may agree or disagree with my choices.  That's okay.  You may choose to send me links.  That's okay, too.

And so, here are some Top Tweets for June 21, 2010:

• Top Tweet LEED: 5 Reasons Why GRI is the New LEED: Many reporting guidelines focus primarily on environmental issues because energ... http://bit.ly/azSxlM (via @thegreengod)
• Top Tweet BIM: Canadian Construction Association to form new BIM organization http://tinyurl.com/2fweghk (via @DenyseGall)
• Top Tweet Construction: Really hates construction law. (via @seraphiel10) (apparently someone studying construction law in Singapore)

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Tweet ... Tweet ... Tweet!  No, I am not cat-calling or whistling at you.  I am tweeting from the ABA Forum on the Construction Industry's annual meeting in Austin, Texas.  The program chairs have set up a Twitter account for the conference.  You can follow @forumaustin or search the hashtag #forumaustin.  If you want to follow my Tweets, you can do so at @matthewdevries.  Also, make sure to send me an email or message if you want to meet up.  And now, to the program schedule:

The Age of Turbulence: Managing Money Issues in Construction

1. From Project Concept to Funding: Where Do You Get the Money?
2. Shaking hte Money Tree: Funding Our Way Out of the Infrastructure Crisis
3. The Inside and Out of Public Private Partnerships
4. Foreign Exchange: The 10 Commandments for Successful Execution of International EPC Projects
5. Accounting for Construction Lawyers
6. Realizing "Value" from Value Engineering: Costs, Benefits and Legal Issues
7. Damages Beyond the Contract: Tort and Statutory Liabilty for Architects, Engineers and Contractors
8. The AACE Recommended Practice for Forensic Schedule Analysis
9. Pursuing Payment: Damned if You; Damned if You Don't
10. Walking the High Wire While Juggling: Strategies to Manage Litigation Costs and Meet Client Expectations
11. Law and Life Series: Making the Business Case for Diversity in the Practice of Constructoin Law
12. Consequential Damages in the Current Economic Climate: A Guide to Recovery and Avoidance
13. Pre- and Post-Judgment Collection Remedies: Show Me the Money!
14. When to Terminate the Client: It's An Ethical Question

That's a packed schedule for three days.  Let me know if there is a specific session you want me to attend.  I will be your proxy and do a special post on Friday.

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The construction industry is one of the hardest hit in this down economy.  From the top to the bottom, from executive to business development and sales to project management, you may find that you have to dust off your resume to look for new opportunities. 

An article by Joann Lubin in the Wall Street Journal yesterday highlighted a networking pro, George Landis, who had to learn some new tricks as his executive job ended last November.  Landis was described as a "deft conventional networker" who once relied on the traditional handshake.  Times are changing ... and Landis realized it.  He agreed to learn networking in the 21st century. Here are the top tips from his informal advisors, as well as a few of my comments:

• Develop a stronger online identity by revamping your resume.  For Landis, this meant changing his work summary from "a seasoned executive" to "I make sick companies significantly better for owners and employees."  From my perspective, it is also good to create an electronic version of your resume that contains hyperlinks to your work experience, notable projects, published articles and speaking gigs. (Here is an example of my electronic resume.)
• Make better use of LinkedIn, a professional networking website.  For Landis, this meant reviving his inactive LinkedIn account.  You may already have hundreds of contacts in your old, dingy address book.  Now's a good time to search those contacts for their online presence.
• Create a more visible personal brand.  For Landis, this meant finding a new way to position himself as a thought leader in business management.  For the construction player, this means finding opportunities to speak and write.  There are local associations like AGC of Middle Tennessee that enjoy new faces at their lunches. You are also bound to find a local educational institution like MTSU that has a concrete management program that always needs guest lecturers. 
• Get a bigger payoff from industry events.  For Landis, this meant joining the Turnaround Management Association and offering to assist in program development.  When you participate in the event organization, your start to become known as a good helper and volunteer.  Your name recognition and reputation builds.

At the executive and business development level, some of these tips may be easier to do than at the project management level.  But I think it comes back to identifying your passion and making that your job.  Former-construction-attorney-turned-marketing-coach Cordell Parvin shares 5 Keys to Success and Fulfillment and the second one is about finding your major definite purpose.  Perhaps your current circumstances allow you to look for new opportunities. And remember, you may be like Landis in your archaic networking ways, but even a pro can learn new tricks.

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I received an email this morning with the following warning: "The following message is intended for construction audiences only. Do NOT watch this clip alone or in the dark. Please wait 30-minutes after eating before watching this clip. DO forward this video on to a friend or colleague."
 

A couple of my observations about AGC's campaign for its annual convention:

1. This is very smart.  When I usually receive mass email alerts and messages, I put them in a "review later" folder and come back to them later in the week.  Not this one.  It caught my attention and I immediately clicked through the links.
2. This is very timely.  Sending this particular message during the week of halloween was ingenious.  Although the AGC Annual Convention is not for another five months, the message was tailored for the season and I am sure we can expect similar treats over the next coming months.
3. This is very exciting.  What AGC did here was step out of the cookie cutter approach to marketing.  It's a sign of the construction industry embracing Social Media and using technology in new ways.  Kudos, AGC!

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I know that title sounds odd. Before you start flooding my email box with comments about the practicality of Building Information Modeling (BIM) or the utility of social networking like Twitter, Facebook or LinkedIn in the construction industry, consider the life of the personal computer:

Were you around in the 1980s during the microcomputer wars between Commodore, Apple, Atari and Tandy? Can you believe that some of the first personal computers once plugged into a standard television that acted as the monitor?  It's so hard for me to even imagine that the little IBM ThinkPad that I pound my fat fingers on every day once looked like this? 

Even when I view the practice of law over the past 20 years, I see the dramatic changes that technology has brought. The legal brief is no longer typed on an IBM Selectric with carbon copy sheets and sent to court via courier—it is drafted on a laptop, converted to an Adobe .pdf document, and electronically filed with the court.  The letter to opposing counsel is no longer dictated to a secretary who takes down every word in shorthand—the words are spoken into a digital handheld device, which is connected to a laptop computer that transcribes the entire letter using voice recognition software.  

Given the transformation of how these simple tasks have been performed over the past two decades, it does not seem that far fetched to believe that technology can help sustain or revive a construction company in the years that follow this recession.  Just read what Geoff Smith, Chief Executive for EllisDon told to Reed Construction Data about the livelihood of the construction industry in the post-recession recovery period:

Turning his focus to new technologies, Smith said that Building Information Modeling (BIM) is the way of the future, adding that those contractors who don’t adopt it will be left behind.

“If you don’t (embrace BIM), you’re not going to make it down the road,” he said. “It’ll take a little while to take hold, because it requires some upfront investment on the part of the clients and the builders. But it’s coming everybody has got to embrace it as soon as they can find a way to.”

The same applies to social networking, which Smith has embraced — he’s on Twitter, Facebook and he blogs.  Social media is a key element of the company’s forward-looking strategy, he said.

“The construction industry over past generations has always been about people — we sell people; we put people on a project.

“Now there is the opportunity and the means to sell knowledge, intellectual capital and to create a competitive advantage doing that — and we see the social media facilitating that and creating that opportunity.”

I have written about the future of BIM being "in the pipeline." I have said that mainstream acceptance of BIM is a question of when ... not if.  When I take a step back and look at an industry's acceptance of a particular technology (i.e., the law firm's use of laptops, electronic filing, digital dictation devices, Blackberries, etc.), it is not difficult to understand and agree with Smith's comments about BIM and social media.

The more difficult exercise is to crystal-ball the issue of defining when a particular technology becomes universally accepted ... of trying to pinpoint when everyone (...or almost everyone...) will use the laptop, cell phone, DVR, iPhone, or even BIM.  But as an advocate of technology, perhaps our job is not to predict ... it is to advance, build up, campaign, encourage and support.

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