Beginner’s Guide to Safely Operating an Adult Website

By: Lawrence G. Walters, Esq.

This legal guide is intended to provide an overview of the federal and constitutional issues impacting operation of an adult website. It is intended for the newbie or those thinking about getting into the business. Given the wide-ranging legal issues facing this industry, legal representation is recommended.  This guide can be used as a resource to ensure that the relevant topics have been discussed with your counsel.

  1. Introduction

The author has represented adult webmasters for over 20 years, and has defended numerous obscenity prosecutions filed against adult website content. Below are some of the legal and constitutional topics facing the adult website operator. This guide is by no means intended as an exhaustive list, but covers the most common legal issues encountered by adult webmasters. Adult entertainment is a “highly regulated industry” in the United States. That means the government can get away with imposing a wide variety of laws and regulations relating to the operation of adult websites, which differ from other “mainstream” goods or services. The adult webmaster should become an expert on legal compliance issues governing the production, distribution, and promotion of erotic content.

  1. Basic Concepts

Adult websites include things like “pay sites”, which require money from the user to access adult content; “free sites” (such as TGP, MGP, Tube sites or Affiliate sites) which provide free access to adult content, usually for promotional purposes; “live webcam sites” which allow users to interact with performers using webcam and chat technology, and “adult dating sites” which connect individuals interested in erotic social interaction.  Publishing and distributing adult content is protected by the First Amendment to the U.S. Constitution, under well-settled legal precedent.  The creation of adult content has been recognized as legal (and not a violation of prostitution laws) in a couple states, but the issue has not been addressed in most parts of the country.  Obscenity and child pornography are illegal, and involvement with these categories of material can result in serious criminal prosecution.  Obscenity laws are rarely invoked these days, but remain on the books as a potential tool for prosecution of adult website operators.  Child pornography and human trafficking laws impose significant age verification obligations on a website operator involved with the creation, publication or advertising of sexually-explicit content.

  1. Age Verification, Model Releases, and Records Keeping Obligations

Adult webmasters must take steps to ensure that performers and website users are over the age of 18 in the US. Federal law imposes numerous records keeping obligations. Title 18 U.S.C. s. 2257 (and associated federal regulations) require that performers in sexually explicit media provide government-issued ID's, and that all producers (including secondary producers such as webmasters) maintain records associated with the performer. We recommend that our clients use our firm's mobile app; Quick2257, to compile mandatory performer age records. Model releases must be obtained and kept separately from the Section 2257 age records. These releases should be drafted by an experienced adult website lawyer, and cover issues such as right of publicity, invasion of privacy, STD's, sexual harassment, condom usage, and character/persona rights. The publication of sexually explicit media on a website generally requires a Section 2257 disclosure statement, which identifies the location of the mandatory records. Some user-generated content or profiles are exempt from these obligations. For example, tube sites and adult dating sites can position themselves to take advantage of Section 2257 exemptions, if operated properly.

  1. Intellectual Property Issues

A variety of intellectual property issues face adult website operators including trademark, copyright, and DMCA safe harbor. The adult website industry has also been targeted by numerous 'patent trolls' based on certain technology utilized to display the erotic media. Website operators must become familiar with the copyright registration process when producing adult imagery. Trademark concerns should be evaluated before selecting a brand name or website domain. If eligible, a trademark registration should be submitted to the U.S. Patent and Trademark Office, to protect the site’s brand name.  Infringement and piracy is rampant on the internet, particularly in the adult industry. Adult website operators commonly develop an intellectual property rights enforcement strategy which includes policing of infringement, transmission of cease and desist letters, DMCA takedown notices, UDRP domain name arbitrations, and litigation when necessary. Those online service providers who permit uploading of content by independent third party users must familiarize themselves with the Digital Millennium Copyright Act ("DMCA"), which provides 'safe harbor' from copyright infringement claims. However, the DMCA imposes stringent requirements in order to assert safe harbor status. The website operator must: 1) designate an agent for receipt of infringement notices by filing a notice with the Copyright Office; 2) Post a legally-compliant Notice & Takedown Policy, describing how to submit a DMCA notice or counter-notification; 3) fairly implement a repeat copyright infringer policy; and 4) notify its subscribers of the Repeat Infringer Policy. Intellectual property is any adult website's most valuable asset. IP rights should be identified, registered, and enforced.  We encourage copyright holders to use our mobile app; QuickDMCA to efficiently transmit DMCA takedown notices to websites facilitating the infringement of their content.

  1. Obscenity, Prostitution, Indecency, and Underage Materials

This section will evaluate core content-related concerns with the production and distribution of sexually-explicit material. Pornography is legal, and constitutionally protected under the First Amendment. Obscenity is illegal, and can result in serious criminal penalties. The difference between the two is governed by the Miller Test, which focuses on whether the content is patently offensive, appeals to the prurient interest in sex, and whether it lacks serious literary, artistic, scientific, or political value. Even pure written material can be deemed obscene, under current case law. Adult website operators must be intimately familiar with the Miller Test, and avoid publication of obscene materials. The production of erotic material is also likely protected by the First Amendment, although only 2 states have court rulings which affirm the legality of adult content production; California and New Hampshire. In other states, the potential applicability of prostitution laws to the act of paying individuals to engage in sexual activity is unsettled. Indecent materials are legal for adults to view, but can be illegal if made available to children. Online age verification is a difficult issue, since existing technology limits the ability of a website operator to identify the age of the individual behind the computer keyboard or smart phone. We permit our clients to use the patented birthdateverifier.com device for online age verification. Other solutions exist, but none are perfect. Bio-metrics and other technology will eventually make it easier to identify the age of website users. A more serious issue arises with the age of persons depicted in sexually explicit material. Child pornography and exploitation offenses are some of the most serious crimes in the nation, at both the state and federal levels. Adult website operators must make every effort to ensure that underage materials are not published on their sites. Apparent underage material posted to a website by third parties must be reported by the website operator to the CyberTip Hotline, operated by NCMEC, pursuant to 18 U.S.C. s. 2258A. Even if all performers are over 18, webmasters should never promote their content as including any child pornography, 'lolita' or 'underage' material. Federal 'pandering' laws have been used to prosecute online advertisers who promote erotic material as depicting underage individuals even if all models are over 18. However, erotic content which involves performers who happen to look young, but are over 18, is not illegal. Attempts to make such 'virtual' child pornography illegal have been rejected by the U.S. Supreme Court, as a violation of the First Amendment.

  1. Website Contracts, Policies, Terms, and Conditions

The operation of an adult website will require the careful drafting of numerous online agreements, contracts, policies, terms and conditions. The following is a partial list of the agreements typically associated with adult website operation: 1) User Terms & Conditions; 2) Advertiser Agreement; 3) Privacy Policy; 4) Affiliate Agreement; 5) Section 2257 Disclosure Statement; 6) Anti-Spam Policy; 7) Human Trafficking / Abuse Policy; 8) DMCA Notice & Takedown Policy; 9) Repeat Infringer Policy; 10) Model Agreement; 11) Website Development Agreement; 12) Copyright/Trademark Assignments; 13) Photographer (Work for Hire) Agreement; 14) Subpoena Compliance Policy; and, 15) Section 2257 Data Acquisition Form. Each of these documents is intended to address a unique set of legal concerns.  Correct implementation and utilization of these important agreements and policies is essential to mitigate legal risks.

  1. Promotion & Marketing

The Federal Trade Commission regulates adult website operations in the U.S.  The FTC has used its authority to enforce consumer protections laws even against website operators located in other countries – often with the assistance of foreign consumer protection agencies.  Any promotional device that may be considered ‘unfair’ or ‘deceptive’ can result in an FTC investigation, and the imposition of significant fines, penalties, and disgorgement of profit.  Use of ‘free’ promotions to generate interest in online goods or services is a risky endeavor, and should only be undertaken in consultation with experienced advertising lawyers.  The FTC, and related state agencies, have pursued adult website operators for all manner of allegedly deceptive activity involving spamming, insufficient legal disclosures, and deceptive advertising. In the often competitive world of adult entertainment marketing, all promotional campaigns should be rigorously evaluated for compliance with state and federal advertising regulations.

  1. Conclusions & Recommendations

Adult website operation can be profitable, but comes with inherent legal risks due to the controversial nature of the content published on the site. The adult entertainment industry is a highly regulated field, and requires careful attention to legal detail. An experienced attorney, familiar with the First Amendment, Adult Entertainment and Internet Law will be an essential part of the team. Operational risks can be substantially reduced by addressing relevant legal issues prior to launch.

 

Additional legal information about adult website operation can be found here;

Shooting the Messenger Stanford Law and Policy Review;
http://www.sin20.com/audio/by/title/01_06_09_-_larry_walters_-_the_new_doj_2257_revisions_you
http://www.firstamendment.com/dmca-agent/
http://www.firstamendment.com/articles/SexLiesChildren.pdf;
http://www.firstamendment.com/tube-sites/
http://www.firstamendment.com/website-review/
http://www.firstamendment.com/free-sites/
http://www.firstamendment.com/copyright-enforcement/