Overstock.com 2008 Annual Report Download - page 30

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Table of Contents
inventories and may cause us to incur losses for any non-compliant items in our inventory, or which we may have sold subsequent to
the effective dates of the legislation, through regulatory or civil actions against us. These current and future laws and regulations could
harm our business, results of operation and financial condition.
Laws or regulations relating to privacy and data protection may adversely affect the growth of our Internet business or our
marketing efforts.
We are subject to increasing regulation at the federal, state and international levels relating to privacy and the use of personal user
information. For example, we are subject to various telemarketing laws that regulate the manner in which we may solicit future
suppliers and customers. Such regulations, along with increased governmental or private enforcement, may increase the cost of
growing our business. In addition, many jurisdictions have laws that limit the uses of personal user information gathered online or
offline or require companies to establish privacy policies. The Federal Trade Commission has adopted regulations regarding the
collection and use of personal identifying information obtained from children under 13. Proposed legislation in this country and
existing laws in foreign countries require companies to establish procedures to notify users of privacy and security policies, obtain
consent from users for collection and use of personal information, and/or provide users with the ability to access, correct and delete
personal information stored by us. Additional legislation regarding data security and privacy has been proposed in Congress. These
data protection regulations may restrict our ability to collect demographic and personal information from users, which could be costly
or harm our marketing efforts, and could require us to implement new and potentially costly processes, procedures and/or protective
measures.
Risks Relating to the Securities Markets and Ownership of Our Securities
The price of our securities may be volatile and you may lose all or a part of your investment.
Our common stock has been publicly traded only since May 30, 2002. The market price of our common stock has been subject to
significant fluctuations since the date of our initial public offering. These fluctuations could continue. It is possible that in some future
periods our results of operations may be below the expectations of public market analysts and investors. If this occurs, the market
price of our securities may decline. Some of the factors that could affect the market price of our securities are as follows:
• changes in securities analysts' recommendations or estimates of our financial performance or publication of research
reports by analysts;
• changes in market valuations of similar companies;
• announcements by us or our competitors of significant contracts, acquisitions, commercial relationships, joint ventures
or capital commitments;
• general market conditions;
• actual or anticipated fluctuations in our operating results;
• intellectual property or litigation developments;
• changes in our management team;
• economic factors unrelated to our performance; and
• our issuance of additional shares of stock or other securities.
In addition, the securities markets have experienced significant price and trading volume fluctuations. These broad market
fluctuations may adversely affect the trading price of our securities. In the past, following periods of volatility in the market price of a
public company's securities, securities class action litigation has often been instituted against that company. Such litigation could
result in substantial cost and a diversion of management's attention and resources.
Our quarterly operating results are volatile and may adversely affect the market price of our securities.
Our future revenues and operating results are likely to vary significantly from quarter to quarter due to a number of factors, many
of which are outside our control, and any of which could harm our business. As a result, we believe that quarterly comparisons of our
operating results are not necessarily meaningful and that you should not rely on the results of one quarter as an indication of our future
performance. In addition to the other risk factors described in this report, additional factors that have caused and/or could cause our
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