Using social media as a marketing tool has been common for as long as social media has existed. This type of marketing is often based on messaging that promotes a company's products or services, while creating a deeper connection with the target market that comes from individuals with personas that are attractive to that audience. Or try to promote by appearing to come.
Often, this means that even if a company has an entire social marketing team to develop the content, the messages are posted to that particular individual's social media account as if they were that person's own random thoughts and experiences. It means that it will be posted as if. Their persona and the business persona are inextricably and indistinguishably intertwined.
In some situations, especially when the individual is very closely associated with a particular business, such ambiguity can make it difficult to know who owns these social media accounts, i.e. the individual who created the persona's account. Disputes may arise as to who the individual is, or the company that employs the individual. This is an interesting question because accounts often have a name or title representing their creator. Although difficult to quantify, as popular accounts can have hundreds of thousands or even millions of followers, the goodwill associated with social media followers can be enormous. Because of this, significant values are at stake.
Over the past decade, several federal courts have dealt with this ownership issue, which almost uniformly arises in connection with employment relationships. Equally consistently, the courts that have decided these cases have found that social media accounts belong to businesses and not the individuals who own the accounts used to post. In most cases, and perhaps in making these decisions, courts have developed a novel analysis that focuses on the complexities of social media, perhaps out of concern for the ambiguity of merging an individual's persona with a brand's marketing strategy. .
Three recent federal court decisions address whether social media accounts belong to individuals or businesses.
The chronologically first of these cases is Regarding CTLI, 528 BR 359 (SD Tex. Bankr. 2015). The case stems from a dispute between the founder of a bankrupt company and the debtor's new management, resulting in a court order forcing the founder to hand over access to the Facebook and Twitter accounts he created. I asked for it.
Taking advantage of the fact that Facebook pages are directly linked to a company's web page, Facebook pages are used to communicate directly to consumers, many of the posts are related to the company's business, and the founders I was sharing passwords so colleagues could post updates. The bankruptcy court found that the account belonged to the reorganized debtor, not the company's founder.
Undoubtedly, the factors considered by the bankruptcy court are relevant. However, as between companies and employees, we have considered numerous cases in which relationships and goodwill that an employee has developed as a result of the employment relationship, at the employer's expense, belong to the employer and do not. , which could have simplified the analysis. Former employee. look, for example, Robert Half International vs. Murray, 2008 WL 2625857, 07 Civ. 799 (ED Cal. 2008) (“The list of subscribers to a service built up over many years by the owner's ingenuity, time, effort, and expense is the property of the employer and is part of the goodwill of its business. ”and possibly his entire business”); BDO Sideman vs. Hershberg93 NY2d 382 (NY 1999) (“Employers have a legitimate interest in preventing former employees from exploiting or misappropriating client or customer goodwill that has been created and maintained at the employer's expense…'' )
Similarly, the court JLM Couture v. Gutmann, 2023 WL 2503432, 20 Civ. 10575 (SDNY, March 14, 2023) provides a more direct analysis by relying on employment-labor principles and the parties' contracts instead of examining the long history of the social media accounts at issue. could have been done. how the parties used them; The lawsuit arose from a dispute between the plaintiff, a “company in the luxury bridal design and manufacturing industry,” and the defendant, a “designer of brides, bridesmaids, evening wear, and related apparel.”
Prior to the dispute, the plaintiff and the defendant were parties to a detailed employment agreement under which the defendant assigned to the plaintiff the right to use her name and its derivatives in connection with the sale of bridal or wedding-related clothing and accessories, and provided that: I agree to all the matters. The bridal wear-related work she developed during the plaintiff's employment was labor for hire. The defendant then created Instagram and Pinterest accounts derived from her name, which became the center of the parties' dispute after their relationship soured.
In analyzing this issue, the district court considered “three overarching categories: (1) the manner in which the account is made available to the public; (2) the manner in which the account is made available to the public; and (2) the purpose for which the account is used.” and (3) whether employees of the company access the account for the purpose of furthering their business interests.”
Applying these factors, because the account was maintained as an official business account and used for business communications and promotion, and because Plaintiff's employees were involved in developing and implementing social media marketing strategies, the account was held by Plaintiff. I concluded that I belonged.
In reaching this conclusion, the court paid little attention to the fact that the parties' employment contracts already addressed the issues in this case. Specifically, under that agreement, the defendant assigned to the plaintiff the right to use her name and its derivatives. Apparently this included the use of social media accounts derived from her name. The contract also specified that the defendant's work product was a rental work. Defendant's social media posts promoting the sale of dresses and accessories she designed were well within the scope of her employment and therefore constituted rental works.
Recently, the bankruptcy court About Vital Pharmaceutical, 652 BR 392 (SD Fla. Bankr. 2023) also argued on a similar issue. The incident stemmed from the bankruptcy of Vital Pharmaceuticals, which manufactures and sells the energy drink “Bang.'' As in his other two cases, the former employee (in this case the debtor's former CEO) sought to maintain control of his Instagram, TikTok, and Twitter accounts. The account handles were created by the former CEO's wife while she was at Vital, or by Vital employees, and use variations of the words “Bang,” “Energy,” and “CEO.” It had been.
In its ruling, the bankruptcy court suggested that lawmakers should adopt a framework to regulate ownership of social media accounts. If that fails, the bankruptcy court asked the court to consider: (1) Whether there is a prior agreement between the parties regarding ownership of social media accounts. (2) which party controlled the social media account; (3) how the parties used their accounts;
Applying these factors, we determined that the account belonged to the Debtor and not to the former CEO, as the account was primarily used to promote the Debtor's products and featured content from the former CEO. . [the debtor’s] marketing strategy. “
Although it is different from JLM CoutureIt is unclear whether the parties had a binding agreement, and the employment-labor doctrine and the fact that the social media posts were within the scope of the former CEO's employment make it easier for you as an employer to resolve the dispute. It's possible that it could have been done. The employment principle has also been applied where the former employee had a particularly personal connection to the business in question. look, for example, Martha Graham School & Dance Foundation vs. Martha Graham Center of Contemporary Dance380 F.3d 624 (2d Cir. 2004) (even though the corporation was “created for the purpose of promoting a supportive environment” for choreographer Martha Graham's artistic work, she Dances she created while employed as a director belonged to the Foundation, not to her successors).
Personal social media accounts will continue to be used routinely as a marketing tool for businesses. The court held that regardless of whether the accounts were created by an individual and/or are derived from that person's name, those accounts are owned by the company advertising the goods or services and not by the individual himself. may continue to be considered as such. It is also clear that in many of these cases such ownership rights are covered by traditional employment contracts, but it is important for companies to make ownership clear in such contracts going forward to avoid disputes. It may be wise to prevent it.
In any case, future courts will simply consider such a It seems prudent to base the case on a number of well-established precedents in good employment contracts and good faith case law. In the end, it can and should be much easier to make decisions.
Emily Poehler Founding Partner of Poler Legal. She is an experienced commercial litigator; Organizations and individuals involved in a variety of complex commercial disputes, with particular emphasis on the intersection of technology, art, intellectual property, and finance.. In addition, we provide outside legal advisory services to a wide variety of companies, helping our clients avoid potential legal pitfalls and manage risks.