In a recent article we asked the question: who owns my social media content? In this article we take that enquiry one step further, and tackle the issue of ownership of the social media accounts themselves.

Businesses are increasingly realising the value of social media, with platforms such as LinkedIn and Twitter often at the heart of their marketing, communications and branding strategies. Further, social media connections and followers are nowadays an important source of new clients. In a world where workers use their social media accounts to promote and grow their employers’ businesses, our traditional notions of social media account ownership are increasingly challenged. In fact, in circumstances where social media connections are developed at the instruction of, and provide a benefit to the business itself, businesses may be surprised to learn that their employees’ social media presence may be an asset belonging to the business itself, rather than the individuals who maintain the accounts.

The seemingly clear line of social media account ownership is blurred by the fact that individuals are often tasked with building the social media presence of their company, but often use their own established social networks to do so. To assist in this business-related social media development, businesses will often pay for employees to use upgraded platforms like LinkedIn Premium, and of course provide remuneration and the resources required to develop professional networks on behalf of the company.

So if both the business and the individual have contributed, who owns the account? What happens at the end of the employment relationship? Is it the individual or the business who owns the hundreds of connections that have been developed during the course of the individual’s employment?

While Australian law in this area remains unsettled, a NSW Supreme Court interlocutory hearing demonstrated judicial willingness to recognise social media misuse as an actionable right. Considering this case in the context of UK and US decisions will provide a clearer, albeit incomplete, understanding of how the law currently deals with the ownership of social media accounts.

What do the courts say?

Australian case law

The NSW Supreme Court considered the issue of LinkedIn connection ownership in Naiman Clarke v Tuccia [2012] NSWSC 314. This case concerned the recruitment company Naiman Clarke alleging that a former employee took names from the company’s candidate database and connected with them via LinkedIn. She then used those connections to solicit clients when she began working for a competitor.

Since the recruiter had only been able to make those LinkedIn connections by virtue of her access to the company’s database, Naiman Clarke claimed the recruiter had misused company information for her personal benefit and therefore breached her duty of confidentiality under s 182(1) of the Corporations Act 2001 (Cth).

The Court held, in an interlocutory decision, that client lists constitute confidential information. Therefore, the recruiter’s use of this confidential information without Naiman Clarke’s consent for the purpose of boosting her LinkedIn connections amounted to a breach of confidentiality.

Unfortunately, although this case is indicative of where the law in Australia might be headed, it doesn’t deal directly with the ownership of the recruiter’s LinkedIn connections themselves, focussing instead on the confidentiality of the client lists by virtue of which the LinkedIn connections were made.

UK case law

Although only a first step towards the development of Australian jurisprudence on this point, the decision in Naiman Clarke, suggests that the Australian courts’ approach is in line with the approach taken in the UK.

The UK High Court in Hays Specialist Recruitment (Holdings) Ltd v Mark Ions [2008] EWHC 745 was the first UK case to consider the risk of appropriation of confidential company information in online networking sites.

The case concerned a Mr. Ions, who was employed by Hays between 2001 and 2007, during which time he copied confidential information concerning clients and contacts of Hays. He subsequently resigned and established his own rival agency. An inspection of Mr. Ion’s email account revealed that he had invited two of Hay’s clients to join his LinkedIn network.

The Court held that the employer had a right to compel Mr. Ions to disclose all LinkedIn connections he had made while at Hays. The Court considered Mr. Ion’s use of those new connections to kick-start his competing recruitment company to be a breach of his duty of fidelity to Hays.

This approach was followed by the English High Court in Whitmar Publications Limited v Gamage [2013] EWHC 1881 (Ch), which involved 3 ex-employees of Whitmar starting up a rival company using business contacts they had gained while employed at Whitmar. The Court granted an interim injunction requiring the former employees to return access, control and management of the company’s confidential information, which the Court found to include one of the ex-employee’s own LinkedIn accounts. Because the employee had only registered and maintained the LinkedIn account at the instruction of Whitmar, the Court was satisfied that the employee had grown her LinkedIn connections entirely for Whitmar’s benefit, and therefore the account belonged to Whitmar, not the employee.

US case law

In the US, the story is much the same. In the 2012 case of Christou v Beatport 849 F.Supp.2d 1055 (2012) a company’s MySpace “friends” were held by a court to be more than a mere customer list - those contacts were akin to actual or at least potential customers of the business, and therefore the company was entitled to recover the login details for the MySpace page.

Similarly, in Phonedog v Kravitz (United states District Court, N.D. California, Case No 11-03474, 8 November 2011) the court refused to dismiss a claim by a business that it owned a Twitter account set up by one of its employees. This case was slightly different, as the Twitter account, although operated by the employee, was in the name of the business itself. Upon termination, the employee attempted to retain the account by changing the name to his own. The business was successful in recovering the account.

What the case law tells us

These cases suggest that the courts in Australia, the UK, and the US will not shy away from holding that a business owns, or has rights to, an employee’s social media accounts or connections, provided that profile and its connections were established and maintained during the course of employment, and for the benefit of the company. This is especially so where an element of dishonesty or impropriety is involved, as was the case in most of the above examples.

The difficulty of the courts’ approach in reality is that most employees use their existing social media accounts to perform any professional business development duties; finding the point at which those accounts become more for the benefit of the company than the employee, and which contacts were made because of the company’s, rather than the employee’s, information, remains a significant challenge for courts and law-makers alike.

LinkedIn terms of service

Perhaps in response to the recent legal debate in this area, LinkedIn has recently updated its terms of service to clarify issues around account ownership. LinkedIn’s terms of service state that the account holder is the owner of the account, but that if an employer has paid for an upgrade (for example to LinkedIn Premium), then the employer has the right to control access to those premium features, and to view usage reports relating to the employee’s use of the premium service.

It is arguable that this arrangement allows employers to claim control over connections made by the account-holder while using the paid features. Conversely, the terms of service update may more firmly cement account holders’ ownership of their accounts and connections. One thing is clear – the terms of service constitute a contract between LinkedIn and the account holder themselves, and would not bind the employer of the account holder if there is no privity of contract.

As yet, the courts have not considered an account or connection ownership dispute in light of the updated terms of service. Whether courts will have regard to LinkedIn’s views on ownership and control remains to be seen.

So, what does all this mean?

Undoubtedly, the digital age has seen a rapid increase in the commercial value of social media in the workplace – it is now one of the most dominant tools for marketing and attracting clients. The cases above show us that questions around who owns these valuable digital assets are far from settled. To ensure that this value is not lost when employees leave, and to minimise the risk of lengthy and expensive disputes, businesses should consider taking the steps below to secure their rights in social media contacts.

1. Social media policy

Businesses should ensure they have a robust social media policy that conclusively establishes the employee and employer’s rights regarding the ownership and control of social media accounts. Where possible, businesses should create their own profiles and ensure they are used solely for the business’ purposes, as this will afford them a far stronger claim of ownership in the event of a dispute. If you ask your workers to use their own social media accounts in the course of their duties, ensure that, at the beginning of the employee’s time at the organisation, a list of which clients were already contacts of the employee is agreed upon. It is essential that your social media policy deals with how new connections they make at work will be dealt with when their employment ends.

2. Express agreements

For added clarity and protection, businesses may consider entering into express agreements with their employees. These agreements should clearly set out employee rights and responsibilities as regards social media, and should ensure those responsible for maintaining a business’s own social media accounts understand from the outset:

  • they maintain a corporate account which is not to be mixed with their personal accounts;
  • ownership of the account remains with the business;
  • the business controls the passwords; and
  • any expectations concerning social media accounts should be confirmed in the early stages of the employment relationship in order to avoid confusion if that employee wishes to move on.

If client contacts are particularly valuable to a business, it may also consider entering into confidentiality agreements or non-disclosure agreements, which expressly include social media connections as part of a business’s confidential information. Not only will this convey a strong message to employees about the employer’s expectations, but in the event of a dispute it will also help demonstrate to a court that the business took active steps to preserve its confidential information.

3. Employment contracts

One of the easiest ways to protect a business’ rights to social media connections is to include strong post-employment restraints in its employment contracts. Employment contracts can provide deadlines for changing personal profile information, guidelines on how the individual may represent themselves in future, and a requirement that individuals disconnect from contacts they made purely as a result of their employment. Employment contracts should also prevent employees from soliciting the business’ clients, employees or other professional contacts, and can include a reference to the use of LinkedIn, and other social media accounts in the definition of “solicitation” within the contract.