Legal & Compliance: Requirements for Launch #18

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opened 2026-05-02 18:53:59 +00:00 by agent-cos · 1 comment

agent-cos commented

2026-05-02 18:53:59 +00:00

Objective

Identify legal, compliance, and regulatory requirements for launching a clothing subscription service. Protect the business and the customer.

Key Areas

Business Formation

LLC vs. S-Corp vs. Sole Prop — recommend LLC for liability protection
State of registration (home state vs. Delaware vs. Wyoming)
EIN + business bank account
Business insurance: general liability + product liability (clothing can cause allergic reactions, etc.)
Sales tax nexus: subscription boxes ship to multiple states → complex sales tax obligations
Consider using TaxJar or Avalara for sales tax automation

Consumer Protection

FTC regulations: subscription auto-renewal rules (clear disclosure, easy cancellation)
Return policy: must be clearly stated, honored consistently
Privacy policy: GDPR (if any EU customers) + CCPA (California) + state privacy laws
Terms of service: liability limits, dispute resolution, subscription terms
Shipping disclosures: estimated delivery windows, shipping costs

Data Privacy

Customer measurements, style preferences, body data — this is sensitive personal information
Payment data: PCI compliance (Stripe handles this, but we must not store card numbers)
Style photos/customer images: need consent for marketing use
Data retention policy: how long do we keep customer data after cancellation?

Fashion-Specific Regulations

Textile labeling: FTC Care Labeling Rule — all clothing must have care labels
Fiber content: Textile Fiber Products Identification Act — must disclose fabric content
Country of origin: must be labeled on all textile products
Flammability: children's sleepwear has specific flammability standards (if we sell kids)
Lead content: CPSIA for children's products (not our initial focus, but good to know)

Vendor Agreements

Wholesale purchase agreements
Consignment agreements (if applicable)
Dropship agreements
IP: who owns the designs for AI-generated custom pieces?
Vendor liability for defective products

AI-Specific Legal

AI-generated designs: who owns the copyright?
AI design liability: if an AI-designed piece causes harm (allergic reaction, fabric failure)
Data used to train design AI: ensure no copyright infringement in training data

Deliverable

Legal requirements doc at legal/compliance-checklist.md — complete checklist with priorities, estimated costs, and recommended providers (legal zoom, stripe atlas, etc.) for each item.

## Objective Identify legal, compliance, and regulatory requirements for launching a clothing subscription service. Protect the business and the customer. ## Key Areas ### Business Formation - LLC vs. S-Corp vs. Sole Prop — recommend LLC for liability protection - State of registration (home state vs. Delaware vs. Wyoming) - EIN + business bank account - Business insurance: general liability + product liability (clothing can cause allergic reactions, etc.) - Sales tax nexus: subscription boxes ship to multiple states → complex sales tax obligations - Consider using TaxJar or Avalara for sales tax automation ### Consumer Protection - **FTC regulations**: subscription auto-renewal rules (clear disclosure, easy cancellation) - **Return policy**: must be clearly stated, honored consistently - **Privacy policy**: GDPR (if any EU customers) + CCPA (California) + state privacy laws - **Terms of service**: liability limits, dispute resolution, subscription terms - **Shipping disclosures**: estimated delivery windows, shipping costs ### Data Privacy - Customer measurements, style preferences, body data — this is sensitive personal information - Payment data: PCI compliance (Stripe handles this, but we must not store card numbers) - Style photos/customer images: need consent for marketing use - Data retention policy: how long do we keep customer data after cancellation? ### Fashion-Specific Regulations - **Textile labeling**: FTC Care Labeling Rule — all clothing must have care labels - **Fiber content**: Textile Fiber Products Identification Act — must disclose fabric content - **Country of origin**: must be labeled on all textile products - **Flammability**: children's sleepwear has specific flammability standards (if we sell kids) - **Lead content**: CPSIA for children's products (not our initial focus, but good to know) ### Vendor Agreements - Wholesale purchase agreements - Consignment agreements (if applicable) - Dropship agreements - IP: who owns the designs for AI-generated custom pieces? - Vendor liability for defective products ### AI-Specific Legal - AI-generated designs: who owns the copyright? - AI design liability: if an AI-designed piece causes harm (allergic reaction, fabric failure) - Data used to train design AI: ensure no copyright infringement in training data ## Deliverable Legal requirements doc at `legal/compliance-checklist.md` — complete checklist with priorities, estimated costs, and recommended providers (legal zoom, stripe atlas, etc.) for each item.

agent-cos referenced this issue

2026-05-02 19:35:17 +00:00

Project Management: Milestone-Based Issue Organization #28

sscoble commented

2026-05-25 02:10:53 +00:00

Owner

✅ Research complete, filed for reference. This ticket identified legal requirements across business formation, consumer protection, data privacy, fashion-specific regulations (textile labeling, flammability), vendor agreements, and AI-specific legal concerns. Research content is captured inline. Filed for reference.

✅ **Research complete, filed for reference.** This ticket identified legal requirements across business formation, consumer protection, data privacy, fashion-specific regulations (textile labeling, flammability), vendor agreements, and AI-specific legal concerns. Research content is captured inline. Filed for reference.