Insurance for web scraping business

[Thomas1988]

I run a web service that extracts data from a third-party website, aggregates the data, then displays the data for end-users. I worry about being sued by the original content provider for copyright infringement and/or unauthorized access to their systems. While my business is registered as an LLC, I still worry about my personal exposure to this risk, so I would like to purchase insurance. Would this sort of liability be covered under an Errors and Omissions policy? It's hard to say, since I am not providing a service to the party that may eventually sue for damages. Would I need a Directors and Officers policy to protect my own assets in this case?
Thanks.

 

[Josh]

Insurance will not cover you if you are literally breaking the law. Yes, maybe there are exceptions to that, but why exactly are you concerned? Are you effectively stealing information and trying to pass it off as your own? Like, is your goal to bypass content owners from being paid for their content?

This isn't an error or omission, these are intentional and overt acts. Sounds like you should talk to an intellectual property attorney and avoid breaking the law.

 

[Thomas1988]

Thanks for the fast reply.
The goal is not to bypass content owners being paid for their content, it is to more efficiently organize and present snapshots of this content to end-users, and to ultimately redirect the end-users to the original content provider. There is growing legal precedence legitimizing web scraping (if you're curious check out HiQ Labs vs LinkedIn, or Southwest Airlines Co vs Kiwi.com Inc). This is an emerging area of cyber law, and given these recent rulings, a reasonable person can engage in web scraping without intentionally breaking the law. That still won't stop lawsuits from being filed, and I want coverage that will pay legal fees in the event such a lawsuit is filed. Really my core question is, does E&O insurance cover lawsuits filed by third parties that were not directly provided a service by the policy holder?

 

[somarco]

reasonable person can engage in web scraping without intentionally breaking the law.

Wow. Sounds like a lot of fun.

How about unintentionally breaking the law?

I am not an attorney but I wonder what kind of defense argument would be used.

 

[Markthebroker]

I am a commercial only broker.

Yes, there are coverages for everything you are asking about, but generally criminal acts are excluded, whether they are intentional or unintentional.

Because of all the recent cyber extortion, and people recently working from home, claims on these types of cyber policies have been going up, and so have the premiums. If you get a quote, you may not like what you see.

 

[Josh]

Thanks for the fast reply.
The goal is not to bypass content owners being paid for their content, it is to more efficiently organize and present snapshots of this content to end-users, and to ultimately redirect the end-users to the original content provider.

What you are describing is an ideal situation for a plaintiff. I have copyrighted material. Like, for real, as in, I have actual intellectual property which I hold rights to by virtue of creating it and funding it. If you take my content without my express permission, you are violating civil (and likely criminal) law. I don't think the fed boys will show up, but look up the term "strict liability". It applies to copyright.

Sounds like you are trying to build a parasite business that doesn't add value. It sounds like absent this content, you may not have a business model. So if they don't need you, didn't want you, and you are not getting their permission, what do you think happens in Court?

Do you know why Napster got shut down?

You know what isn't a good defense? "Other people are breaking the law".

Tell you what, maybe I'm being too harsh. If I am, I apologize. Would you like to share more details about how your business that appears to be based on stealing other peoples content to generate income is not simply ripping off other people for their content and creations?

I'm a few hundred grand deep in this space. Have a great attorney for it. If you would like to not listen to the theme here, please go for it, but your question about insurance covering things seems to be answered; if you are breaking the law, the insurance is unlikely to cover. That simple. So do you know the laws you could and/or would be breaking? Not good friend, not good. You should go pay an attorney and let them explain it to you.

 

[Josh]

Also, you are not describing a "scraping business", you are describing being a "publisher".

 

[fed up]

Not to mention how many agents are going to place a target on your back for scraping their input. Agents have been fired from companies for a ts of screen scraping.

 

[marindependent]

I run a web service that extracts data from a third-party website, aggregates the data, then displays the data for end-users.

From what the posters states, it does not seem that he/she/they provide services all that much different than what googles does, to at least some extent.

I agree that I would suggest speaking with an attorney. I would also look at several policies and suggest that you read every bit of the language.

One last suggestion, I think you will be much better protected if you have systems in place to avoid: "... copyright infringement and/or unauthorized access" - Are you getting their permission, looking through legal notices on sites, etc? Do you have a process to remove or take down content simply and easily? Do you use proper citasions?