Some business assets are easy to spot: a company car or fax machine, for example. Others are intangible, like a bank account or line of credit.
And then there is one item that is just emerging as a recognized business asset: social media accounts. Yes, a business can “own” its social media presence.
Online accounts for Facebook, Twitter, LinkedIn, and so on are valuable resources and, increasingly, businesses are struggling with determining to whom this property belongs.
What’s the Big Deal?
There is two-fold value associated with these social media accounts.
First, an account page contains user-generated content that has been created specifically to promote that business’s goods or services. It has been developed, at the very least, as a means to increase awareness about a business. Some social media pages serve as a way to respond to customer complaints, release announcements, or advertise special promotions.
Second, the account has followers, friends, or connections that are unique to it as a business. The accounts that are linked to a business represent real past, present, or future customers and clients.
PhoneDog v. Kravitz
In 2012, a case emerged that put the ownership issue in the spotlight: PhoneDog v. Kravitz. Defendant Kravitz was an employee of PhoneDog. He was provided with a “company” Twitter handle, @PhoneDog_Noah. One of his job responsibilities was to promote his employer’s services and share company information through the account.
Over 17,000 people followed @PhoneDog_Noah.
Kravitz later decided to leave PhoneDog and the company requested the return of the Twitter account. Kravitz refused and instead changed the Twitter handle to @noahkravitz, thus retaining the company’s 17,000 followers.
The company then sued Kravitz, based on several theories of liability including: misappropriation of trade secrets, conversion, and intentional interference with prospective economic advantage.
Bottom line? PhoneDog believed Kravitz stole their Twitter account, likening the account’s followers to a client list, and doing so caused the business economic harm. The case was eventually settled for an undisclosed amount.
Your Company’s Social Media Policies
Expect to see more litigation stem from ownership of social media accounts in the near future. If you’re a business owner, there are some best practices that you can follow to avoid a PhoneDog-esque incident.
- Every social media policy should include a provision that all online accounts are the exclusive property of the company.
- In addition, include a line directly on your social media pages that the account is the property of the company and does not express the views or opinions of any individual.
Often, as in the PhoneDog case, one employee is designated as responsible for updating social media accounts. While it is smart to only have one or two people in charge of posting content to accounts, one person should never be the sole password possessor. The owner or manager should have all log-in information on-hand.
Lastly, if you are just starting your business, plan ahead and determine what will happen to the social media accounts in the event the company dissolves or is split by including a provision for them in the operating agreement.
PhoneDog demonstrated ownership can be a dog-eat-dog world when it comes to a business’s social media accounts. Remember to consider your accounts as any other business asset and plan accordingly.
Amy D. Cubbage is Of Counsel in the Louisville office of McBrayer, McGinnis, Leslie & Kirkland, PLLC. She concentrates her practice in litigation in the areas of employment, complex tort and commercial litigation, including class actions, toxic torts and mass torts. Ms. Cubbage may be reached at (502) 327-5400, ext. 308 or firstname.lastname@example.org.
This article is intended as a summary of newly enacted federal and/or state law and does not constitute legal advice.
Article originally appeared on McBrayer’s Employment Law blog, mcbrayeremploymentlaw.com.