Who's Tweeting Whom?: Ownership of Digital Media Communities Is Becoming an Increasingly Contentious (and Litigated) Issue
Media Law Bulletin
It is not an uncommon situation. Not anymore, at least. Most companies—estimates are as high as 76 percent—employ at least one (and often several) media specialist to spread the gospel about the greatness of their brands (so-called social media evangelists) by tweeting, blogging, "liking" and otherwise engaging with the digital world. But, what happens when those relationships sour and those once-synchronous efforts diverge? What happens when those digital evangelists who have built up loyal followings based on their writing style, unique insights and engagement with the community leave the company—either on good terms or bad? Can a company claim ownership of—and cash in on—an employee's social media community? If so, under what circumstances? And, what value—if any—can be ascribed to the members of that community?
Not surprisingly, there are no definitive answers regarding ownership of employee cultivated digital communities on behalf of a company. The law has not grappled with these kinds of issues much and is generally ill-equipped (for now) to deal with them. It is not uncommon for rather antiquated legal concepts to be (mis)applied because the law lags technology by a considerable margin. Ownership of social media accounts and their followers does not fit neatly into, for example, the trade secret box. (Recall the brouhaha when Rick Sanchez left CNN about whether he would get to keep his Twitter account and its many, many followers? He did, but changed the user name.)
Before we get to that all the juicy legal stuff, let's set the stage. PhoneDog.com, an interactive mobile news and reviews web company, sued Noah Kravitz, a former product reviewer and video blogger for the company, after he refused to relinquish his Twitter account when his employment ended, which was amicable at first. By all accounts, Kravitz was good at his job—while writing and vlogging for PhoneDog, Kravitz amassed a considerable, and very enviable to digerati (it's a word) Twitter following of more than 17,000 followers.
There is some dispute about what happened upon Kravitz's departure, but it appears that PhoneDog originally gave him permission to keep the account provided that he tweeted (presumably positively) about it from time to time. Kravitz changed his twitter handle from @PhoneDog_Noah to @noahkravitz, but kept the 17,000 followers. Eight months later, PhoneDog requested that he relinquish the account and, with it, the coveted followers. Kravitz refused.
PhoneDog sued Kravitz, asserting various claims, including misappropriation of trade secrets, interference with economic advantage and conversion. PhoneDog alleged that it requires its employees to maintain Twitter accounts to tweet links to the PhoneDog site, but there were not any allegations regarding the manner in which such accounts should be created or maintained. PhoneDog also argued that the followers were integral members of its mobile news and reviews community and thus constituted protectable trade secrets.
Who Owns What?
By way of brief background, a trade secret is—huge overgeneralization alert—proprietary information that is confidential and provides a business advantage of some kind. Customer lists—dating back to the ol' Rolodex days—have been a fertile source of trade secret litigation absent a contractual agreement delineating ownership. The question of "ownership" is complicated in digital media because personal identity is readily confused with corporate branding in that the tweeter is the one engaging with the community, often on a personal level, by sharing intimate (hopefully not overly so) details, stories and observations.
At root, PhoneDog's claims were that it had an economic relationship with the followers and Kravitz's taking the account disrupted that relationship. Unbeknownst to this author and my 354 followers (which seems to consist primarily of spambots), a Twitter follower is currently valued—according to industry standards—at $2.50 per month. Accordingly, PhoneDog sought damages of approximately $340,000 comprised of $2.50 per follower (17,000) per month for the eight months that Kravitz maintained the account after leaving the company. (I will gladly sell most of my followers, and certainly the spammy ones, by the way.)
Kravitz countered that the valuation was suspect because followers have discretion to unsubscribe at any time. He also argued that there was no evidence that a Twitter account, even one with a significant number of followers, has any ongoing value because the vast majority of followers are extremely disengaged as they rarely click on links or buy anything sold via those links. After all, the primary purpose of social media is to generate conversation and to build brand awareness, not to sell. Generally speaking, people follow someone because they are interested in the information or the writer's style or unique insights, not to be bombarded with links to buy stuff.
Kravitz moved to dismiss PhoneDog's claims by first arguing that Twitter—and not PhoneDog—owned the account pursuant to its terms of service (and thus PhoneDog was a mere licensee of the account). Kravitz argued that there was no agreement containing any confidential information restrictions and, even if there was, it would not matter because any of the Twitter followers could be viewed by anyone with a Twitter account and therefore were not confidential trade secrets. The court denied Kravitz's attempt to get the case thrown out, finding that PhoneDog had adequately stated claims for now, but will have to prove them in discovery.
Controlling the "Connections"
Despite the relative infancy of social media, the PhoneDog case is not the first one to address the ownership question. In Pennsylvania, Linda Eagle and her former employer, Edcomm, ended up in litigation over control of her LinkedIn account and its "connections." The company accused Eagle of stealing trade secrets and misappropriating Edcomm's property for her own use. The court ruled that the LinkedIn connections did not constitute trade secrets because they "were generally known in the wider business community or capable of being easily derived from public information." The court also took a fairly dim view of the economic interference claim stating that "Edcomm failed to point to one potential contract that would have materialized absent the alleged interference." Similarly, a federal court in New York ruled that a customer list of an executive search firm was not a protectable trade secret because the list and the employment needs of those clients could be pieced together through Internet searches of various sites, including Bloomberg and LinkedIn.
It is not difficult to see how these ownership issues can multiply. Many companies employ a host of disparate social media strategies and platforms with numerous unchecked accounts with countless customer interactions. With so many people tweeting, blogging and otherwise engaging, these issues can and will manifest in a myriad of ways.
Protecting Against Risks
Fortunately, there are some things companies can do to mitigate these risks. First and foremost, in order to deal with the ownership issue prospectively, companies could include explicit ownership provisions regarding digital media accounts in employment agreements. The ownership provision would provide that all such accounts are the exclusive property of the company and that employees have no ownership interest in the account or any of its followers. This approach has held up in court. In a recent case, a federal judge in New York enforced a contract signed by the defendant (who worked for the plaintiffs as a social media producer) that vested ownership of her digital work product to the plaintiffs and required her to return all confidential information (defined to include followers, fans and subscribers) at the plaintiffs' request. After her employment ended, the plaintiffs demanded access information (passwords) to the various social media accounts and the court agreed, finding that it was "uncontested" that the company owned the right to the information. The court also found that the fact that the company would be unable to interact with its followers could amount to irreparable harm.
In addition to having employees agree that all social media accounts belong to the company, another way to proactively address this situation from the operational side is for the company to create the account itself through a senior marketing executive. That way companies get to select the handle (name) they want to develop and to establish the login information so that they are not placed in a precarious position of asking former employees to be so gracious as to provide it to them. Additionally, periodic monitoring of the accounts is vital (passwords can be changed, after all). Finally, immediate termination of the departing employee's access is, perhaps needless to say, quite important.
As with most digital media legal issues, there is no fail-safe way to deal with the ownership issue. A well-thought out and developed strategy, including consideration of appropriate contractual provisions and technical safeguards, will go a long way to reducing those concerns. Unfortunately, businesses still have to worry about that video of employees goofing off going viral or insensitive tweets. Alas, that is a topic for another day.