Standing Up for Small Business

Date: April 26, 2016

An NFIB member fought government intrusion into his company’s data-protection practices.

Michael J. Daugherty took pride in the cybersecurity measures at his cancer screening company, LabMD in Atlanta. 

Imagine his surprise when the Federal Trade Commission (FTC) sued him, claiming LabMD had left customers’ personal information vulnerable to hackers. 

Instead of settling with the FTC, Daugherty fought back. In late 2015, he won—a judge dismissed the case. 

But Daugherty says he was forced to shutter LabMD because of reputational damage and the expense of a federal investigation. He wrote a book, The Devil Inside the Beltway, as a cautionary tale for other small business owners. 

We Give Our Power Away

Daugherty encourages small business owners to advocate for a collective voice in government policy. 

“Small businesses have to get more involved in the process,” he says. “People think small equals weak, so we give our power away.”

The FTC has its priorities backward, Daugherty says. “When the government is spending so much time and effort pounding a small business into the ground, it’s very concerning,” he says. “They should be pounding cybercriminals into the ground.”

Be Vigilant

Daugherty’s advice: “Do your homework. Hire good people. Keep your data secure,” he says. “There are a lot of hustlers trying to exploit, and small businesses are sitting ducks.”

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