Kickstarter. GoFundMe. Fundable. IndieGoGo. Donors Choose. Kiva. With each new crowdfund website I hear about, I wonder about some of the legal issues involved — and what the effect might be on individual artists and writers who fall afoul. Dan Lear’s blog post for the NW Lawyer, the Washington State Bar blog, Advising a Crowdfunded Creater: Avoiding Bob Ferguson’s Wrath, identifies some of the legal issues for creators who meet their fundraising goals but fail to follow through. Ferguson, the Washington State AG, and his office recently won a $50,000 fine against a creator funded through Kickstarter who failed to provide the promised goodies. The post is aimed at lawyers, but includes some tips for creators, and links to the cautionary tale.
I know you’ll never fail to keep your promises. But maybe one of your characters does, or gets in trouble using a crowdfunding source to raise capital for a business, which involves a whole other set of issues and regulations, or to raise money for litigation. It’s an area ripe for conflict, which makes it ripe for story.
I also spotted these articles or guides on crowdfunding for individuals, such as writers or artists. Do note, I’m providing these links to help you understand the issues; I do not vouch for the info provided, I am not providing legal advice, and reading this blog does not create a lawyer-client relationship — if you’ve got legal questions about crowdfunding, or heaven forbid, a problem, consult a lawyer in your own state who has the appropriate knowledge!
Legally Speaking, It Depends – Crowdfunding Legal and Business Issues, from Script Magazine, May 2014
Kickstarter Legal Guide, from a Portland OR law firm
The Problems and Promises of Crowdfunding, from Forbes Magazine, July 2013