LEL Flash | Issue: January 2013

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Issue: January 2013

Tech Corner

Whose Social Media Account Is it? The Employee's or the Employer's?

In the social media era, the line between personal and professional social media activities and friends is becoming increasingly blurry. Many employees have social media accounts that predate their employment, but they may add friends and connections as a result of their employment. Employees may even use their or their employer's social media accounts to attract and communicate with customers. When an employee changes jobs, questions can arise regarding whether the social media account's "friends" are a trade secret and whether the employer or employee is entitled to maintain control over the account. Courts and legislatures across the country are just beginning to address these issues, with varying outcomes. This fascinating legal area requires a delicate balancing of employee privacy rights and employee's ability to express themselves and an employer's rights to protect its business assets.

Three courts so far have addressed the extent to which an employer can assert an interest over a social media account maintained in an employee's name. The first case to address the ownership and status of a social media account was PhoneDog v. Noah Kravitz, No. C11-03474 MEJ, 2011 WL 5415612 (N.D. Cal. Nov. 8, 2011). PhoneDog is an interactive mobile news and review web source that reviews mobile products and services and uses a variety of social media, including Twitter, Facebook, and YouTube, to market and promote its services to users. The defendant, Noah Kravitz, worked for PhoneDog as a product reviewer and video blogger. In that role, PhoneDog gave Kravitz a Twitter account "@PhoneDog_Noah," which Kravitz used to transmit his product reviews and blogs to PhoneDog's customers. The Twitter account had approximately 17,000 followers. When Kravitz ended his employment with PhoneDog, he refused to relinquish control of the Twitter account. Instead, he changed the handle to "@noahkravitz" and continued to use the account--with its built-in 17,000 followers--while working at a competitor company.

PhoneDog sued Kravitz for misappropriation of trade secrets, among other claims. Kravitz moved to dismiss PhoneDog's complaint, arguing that the Twitter account followers could not be a trade secret because the followers of the Twitter account are not secret; they are publicly available for all to see. The court rejected this argument, holding that PhoneDog had sufficiently stated a claim for misappropriation of trade secrets by describing with particularity the alleged trade secret--the Twitter account followers--and Kravitz's refusal to relinquish control of the Twitter account. However, the court avoided definitively holding that Twitter followers can constitute a trade secret. The case then settled, leaving open the question of whether PhoneDog could have demonstrated that Twitter account followers constitute a trade secret.

A Colorado federal court followed California court's lead in Christou v. Beatport, No. 10-cv-02912, 2012 WL 872574 (D. Colo. March 14, 2012), allowing a plaintiff's trade secret misappropriation claim premised on the theft of MySpace friends to survive the pleading stage. In Christou, the plaintiff, who owned several nightclubs in Denver referred to as "SOCO," employed the defendant to maintain a MySpace account and become "friends" with SOCO's patrons and vendors. The defendant subsequently broke ties with SOCO, formed his own competing nightclub, and allegedly stole SOCO's MySpace "friends" and tried to drive SOCO out of the electronic dance club business. Plaintiff sued for the theft of SOCO's MySpace friends, alleging that SOCO's relationship with the individual friends on MySpace constituted a trade secret. The court allowed the claim to pass the pleading stage, reasoning that the plaintiff's effort and expense in friending thousands of potential dance club patrons and vendors, and thus having their contact information and permission to contact them, could constitute a protectable trade secret.

On the other side of the country, a Pennsylvania court reached the opposite conclusion. In Eagle v. Morgan, No. 11-4303, 2011 WL 6739448 (E.D. Pa. Dec. 22, 2011), the court found that LinkedIn contacts did not constitute a trade secret because information regarding the company's customers and connections was publicly available. However, the court found the company could assert an ownership interest in its former executive's LinkedIn account where the account had been established and maintained by the company for the benefit of the company.

The plaintiff in Eagle, Dr. Linda Eagle, co-founded Edcomm, Inc. ("Edcomm"). In 2008, Dr. Eagle established a LinkedIn account to promote Edcomm, foster her reputation as a businesswoman, reconnect with family, friends, and colleagues, and build social and professional relationships. An Edcomm employee assisted Dr. Eagle in maintaining the LinkedIn account and had access to Dr. Eagle's password. In 2010, Edcomm was sold to Sawabeh Information Services Company, and Dr. Eagle was involuntarily terminated. Following her termination, Dr. Eagle found the password to her LinkedIn account had been changed. The LinkedIn page previously associated with Dr. Eagle was changed to a page featuring Edcomm's interim CEO. Dr. Eagle filed a lawsuit against Edcomm and, after filing suit, regained control over the LinkedIn account. However, she refused to return to Edcomm the proprietary information associated with the account, leading Edcomm to file counterclaims against Dr. Eagle. Edcomm's counterclaims included misappropriation of trade secrets and misappropriation of an idea based on Dr. Eagle's use of the LinkedIn account.

Based on Dr. Eagle's motion for judgment on the pleadings, the court dismissed the trade secret claim, finding that LinkedIn account connections could not be a trade secret because they were generally known in the business community and could easily be derived from public information. However, with respect to the misappropriation claim, the court found that Edcomm stated sufficient facts to survive dismissal because Edcomm had a stated policy requiring executives to create LinkedIn accounts using an Edcomm template. Moreover, Edcomm personnel, not Dr. Eagle, developed and maintained all connections and much of the content of the LinkedIn account.

None of these cases have passed the pleading stage, but together they demonstrate that courts are tending to recognize employers' interests in employees' employer-sponsored social media accounts, generally holding that, even if social media connections are not trade secrets, the employer may have a protectable interest in a social media account developed or maintained by an employee on the employer's time or using the employer's resources.

However, this trend has not been followed by legislative bodies. Several states, including California, Maryland, and Illinois, have passed legislation aimed at protecting the privacy of employees' social media accounts. For example, on January 1, 2013, a new law will take effect in California prohibiting employers from requiring an employee or applicant to (1) disclose their username or password to personal social media sites; (2) access personal social media in the presence of the employer; or (3) divulge any personal social media. In light of these new laws, look for future employment-related social media litigation to focus on the definition of a "personal" versus "professional" social media account, despite the fact that distinguishing between the two can be a practical challenge.

Donna M. Rutter is a shareholder and Karen Pazzani is an associate with Miller Law Group, a management-side employment law firm with offices in San Francisco and Los Angeles.


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