Juno 2012 Annual Report Download - page 26

Table of Contents
similar matters, as well as a wide variety of other claims including, without limitation, claims for defamation, right of publicity, negligence, and privacy
and security matters. The failure to successfully defend against these and other types of claims, including claims relating to our business practices, could
result in our incurring significant liabilities related to judgments or settlements or require us to change our business practices. Infringement claims may
also result in our being required to obtain licenses from third parties, which licenses may not be available on acceptable terms, if at all. Both the cost of
defending claims, as well as the effect of settlements and judgments, could cause our results of operations to fluctuate significantly from period to period
and could materially and adversely affect our business, financial condition, results of operations, and cash flows. In addition, we also file actions against
third parties from time to time for various reasons, including, without limitation, to protect our intellectual property rights, to enforce our contractual
rights, or to make other business-related claims. The legal fees, costs and expenses associated with these actions may be significant, and if we were to
lose these actions, we may be required to pay the other party's legal fees, costs and expenses, which also may be significant and could materially and
adversely affect our business, financial condition, results of operations, and cash flows.
Various governmental agencies have in the past, and may in the future, assert claims, institute legal actions, inquiries or investigations, or impose
obligations relating to our business practices, such as our marketing, billing, customer retention, renewal, cancelation, refund, or disclosure practices.
The Federal Trade Commission ("FTC") and certain state agencies have investigated Internet companies, including us, in connection with consumer
protection and privacy matters. In addition, we have received civil investigative demands and subpoenas, as applicable, from the FTC and the Attorneys
General of various states, primarily regarding their respective investigations into certain former post-transaction sales practices and certain of our
marketing, billing, renewal, and privacy practices and disclosures. We have been cooperating with these investigations. However, the outcome of these
or any other governmental investigations or their potential implications for our business are uncertain. We may not prevail in existing or future claims
and any judgment against us or settlement or resolution of such claims may involve the payment of significant sums, including damages, fines,
penalties, or assessments, or changes to our business practices. For example, in 2010, Memory Lane, Inc. (then known as Classmates Online, Inc.) and
FTD, Inc. paid $960,000 and $640,000, respectively, to resolve an investigation of the Attorney General for the State of New York related to their
former post-transaction sales practices. Defending against lawsuits, inquiries and investigations also involves significant expense and diversion of
management's attention and resources from other matters. There are no assurances that additional governmental investigations or other legal actions will
not be instituted in connection with our former post-transaction sales practices or other current or former business practices. Enforcement actions or
changes in enforcement policies and procedures could result in changes to our business practices, as well as significant damages, fines, penalties or
assessments, which could decrease our revenues or increase the costs of operating our business. To the extent that our services and business practices
change as a result of claims or actions by governmental agencies or private parties, or we are required to pay significant sums, including damages, fines,
penalties, or assessments, our business, financial condition, results of operations, and cash flows could be materially and adversely affected.
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The FTC has regulations regarding the collection and use of personal information obtained from individuals when accessing websites, with
particular emphasis on access by minors. In addition, other governmental authorities have regulations to govern the collection and use of personal
information that may be obtained from customers or visitors to websites. These regulations include requirements that procedures be established to
disclose and notify users of our websites of our privacy and security policies, obtain consent from users for collection and use of personal information
and provide users
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