Friday, January 13, 2012

The Latest Social Media Issue for Employers: Who Owns a Twitter Account?

There's a particularly interesting case percolating in federal court in the Northern District of California, where an employer is suing a former employee over the content and value of a Twitter account.

The company, going by the unlikely moniker of "Phonedog", is in the business of reviewing wireless and mobile electronic products and services and provides users with resources needed to shop for mobile carriers. The former employee worked as a product reviewer and video blogger and used a Twitter account with the Phonedog moniker, via which he transmitted his reviews and other content. The account was accessed through a password, and disseminated information to promote Phonedog services. This particular former employee was apparently adept at his job and his Twitter account had approximately 17,000 followers at the time he resigned. Following his resignation, the former employee switched the account handle to his own name, and begin using the account to promote another company, TechnoBuffalo.

I can only hope that Phonedog impleads TechnoBuffalo into the case, just for the name.

Phonedog sued the former employee for theft of trade secrets and interference with business relationships. In a recent decision, the court allowed the case to go forward, but what's particularly noteworthy are the issues that the court will be resolving through the course of the litigation. Issues such as: who owns a Twitter account? The short answer is that Twitter does, but is there a property interest when a company licenses an account from Twitter that is then used exclusively by an employee in the pursuit of his duties? And who actually owns the Twitter followers? Or, more appropriately, who has an economic right to continued access to those Twitter followers? The company, of course, argues that the list of followers is akin to a business customer list, but since these people aren't buying anything from the company (Phonedog derives its income from the advertising that it sells based on the number of people that use its site for mobile carrier reviews), does the customer analogy apply? And finally, what's the appropriate measure of damages for loss of such a Twitter account? Is it the loss of advertising, or is it possible to fix a definitive monetary number based on each follower of the account over a set period of time? How far into the future do you have to project that these followers would stay with the account, and can you project increases with enough particularly and reliability?

I'll provide updates on the litigation as I get them.  As the definition of economic activity expands through social media, this case may be a bellwether.  At the very least, it raises some compelling legal questions.

And here's another SM decision involving LinkedIn--similar issues.

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