Want to learn more about drafting, negotiating, and understanding intellectual property and technology contracts and have 10 minutes to spare? Grab your morning coffee or afternoon tea and dig into our Tech Contract Quick Bytes—small servings of technical contract insights prepared by our seasoned attorneys. This month, we are discussing ownership and proprietary rights to social media accounts.
When you create a social media account are you thinking about who owns it? When a brand uses social media to drive its business, the legal implications of account ownership become even more complex. What if a business' social media account becomes so entwined with a brand and commercial presence that a business relies, at least in part, on the maintenance of that account? What rights do you have to that account in such a scenario? Some recent case law sheds light on these questions.
Second Circuit Decision
A recent Second Circuit decision looked at what happens when a person contracted by a company entwines her personal social media presence with the company's brand. In this case, a social media influencer signed a contract with a bridal wear company to design the company's products.
The influencer then created social media accounts with a handle that included her own name and used those accounts to advertise for the bridal wear company. The company said those accounts became "critical" advertising platforms for their products.
The contract between the company and the influencer had included provisions to protect the company's brand and prevented the influencer from taking certain actions related to it. When the influencer removed the company's access to her social media accounts, the company sued.
Social Media Accounts as Claimable Property?
It may not come as a surprise that U.S case law has found that electronic records may be treated like property equivalent to physical records in certain circumstances. Would a social media account rise to the same level?
Interestingly, in the bridal wear case, the Second Circuit ruled that social media accounts should be treated "like any other form of property," In other words, determining the original owner of a social media account is the same as determining the original owner of other forms of property.
Which means that when someone creates a social media account with their personal information for personal use, they originally acquire the associated proprietary rights. So, a company that relies on that person's social media account should secure an agreement clarifying the ownership of the associated proprietary rights are to be held by and in the name of the company.
Resolving Social Media Account Ownership
What if a comprehensive agreement doesn't exist? Few courts have examined disputes over social media account ownership. In fact, the recent Second Circuit decision highlighted the novelty of the issue,
But according to the decision, anyone who creates a social media account with their personal information for their own use holds the initial property rights. And these rights can be transferable but are not automatically transferred without a corresponding agreement. But transferring rights to a third-party social media network account does not necessarily mean the same thing as transferring "ownership" of the social media account.
Instead, and with social media accounts, the account holder merely transfers the claimable rights as the registrant. Meaning, the right to hold and maintain the account, i.e., rights akin to a phone number. However, such rights are arguably the only claimable rights. And for purposes of the Second Circuit decision example, to establish and maintain control of the social media account, a company should acquire all available rights in and to the social media account and its name and handle to protect and preserve them.
If you have any questions or would like to discuss a strategy for securing your social media accounts, please contact A.J. Zottola.