January 11, 2012
By Shawn A. Kachmar, published in Business in Savannah.
There is no doubt that the emergence of social media use in our everyday lives – both personally and professionally – has generated conflicting feelings of enthusiasm and uncertainty.
Businesses looking to establish a social media presence are faced with questions about which social media platforms and strategies are most effective and who is responsible for implementing the company’s social media strategy. Often overlooked in this process are questions about ownership of the company’s social media activities.
A recent lawsuit highlights these concerns. PhoneDog is a mobile phone review website. In 2006, it hired Noah Kravitz, who began to assist PhoneDog with establishing its social media presence on YouTube, Twitter and Facebook, among other sites. While working for PhoneDog, Noah created a Twitter profile and began writing under the name @phonedog_noah, ultimately amassing 17,000 followers.
After his resignation from the company, Kravitz changed his Twitter profile name to NoahKravitz, keeping all of the same followers added under his previous profile name @phonedog_noah. Kravitz claims that this change in user-name was done with the understanding that he would continue to write for PhoneDog from time to time. PhoneDog, predictably, has a different view.
PhoneDog later filed a lawsuit against Kravitz claiming that the Twitter list amassed under @phonedog_noah was in fact a “customer list” and is seeking damages in the amount of $2.50 per month, per follower, over eight months, for a grand total of $340,000.
PhoneDog claims that Kravitz continued to use the account to promote products and services unrelated to PhoneDog, and that the company lost advertising revenue as a result of Kravitz’s actions.
As insignificant as 140 characters may seem, the influence of a well-run Twitter account can translate into serious sales for companies. In this particular case, the original intent of why the Twitter account was opened, and how it was used, will be important. If the account was created and used to communicate directly to PhoneDog customers, create brand loyalty, and/or bring in new customers, then Kravitz’s claims may not be viable.
PhoneDog did not have a written policy in place detailing an exit plan for employees and the transfer of social media accounts handled by the employee for the company. Nor did the company have Kravitz sign an acknowledgment that any social media accounts or activities created or managed in the course of his employment are and remain the property of PhoneDog.
This case should serve as a major red flag to businesses operating company social media accounts without a social media policy — put one in place as soon as possible.
A good social media policy outlines permitted and prohibited activities that may be undertaken on behalf of the company. It also protects the intellectual property of others and ensures that all accounts, materials, and other activities created or undertaken for and on behalf of the company remain within the company’s control and ownership. Companies should also think about consulting with a social media practitioner to determine how to brand the company in social media activities and how to manage such activities.
Particularly in the rapidly developing world of social media, companies need to stay current on the latest social media technologies and trends, and should continuously evaluate the best approach to integrating online communication channels into their business practices and strategies.
Company policies should also be robust and flexible enough to protect company assets but also allow for the development and implementations of social media strategies. Without such precautionary measures, you may find yourself losing revenue and suing rogue employees rather than focusing on the bottom line.
Shawn A. Kachmar is a partner in the Savannah office of HunterMaclean, practicing in the areas of employment law, employee benefits and business litigation. He can be reached at 912-236-0261 or skachmar@huntermaclean.com.
