Who really owns an employee’s social media accounts?

Who really owns an employee’s social media accounts?

The recent judicial scrutiny of proprietary rights concerning company Twitter accounts and LinkedIn profiles is attracting a fair bit of attention, as the implications of decisions in this area can be far-reaching. Social media accounts have proven to be a uniquely versatile marketing and business development tool which employers are often more reluctant to part with than the employees who created them. Are allegations by employers that social media accounts contain “trade secrets” justified in order to preserve any financial or reputational benefits associated with the departing employee’s account, and do these accounts give rise to inherent property interests?

The US precedents thus far, PhoneDog v. Kravitz, 2011 U.S. Dist. LEXIS 129229 (MEJ) (N.D. Cal., Nov. 8, 2011) and Eagle v. Morgan, 2011 U.S. Dist. LEXIS 147247 (RB) (E.D. Pa., Dec. 22, 2011), where the US District Court refrained, on both occasions, from dismissing the employers’ suits for access to their former employees’ social media accounts, are by no means a conclusive indicator of judicial recognition of employers’ proprietary rights in this new arsenal. When the proprietary interests were not expressly covered in an agreement between the parties, the waters are still mostly untested. In the cases cited above, the US District Court merely denied motions to dismiss suits at an early stage in the proceedings, but has not yet addressed the validity of the employers’ claims. The test for granting a motion to dismiss a suit is whether or not the claim gives rise to a cause of action for which applicable substantive law offers a legal remedy. The test applied on these motions is stringent, as granting such a motion would effectively deny a Plaintiff its day in court, which judges are loathe to do, unless such action is frivolous and vexatious, multiplicitous, or discloses no cause of action. While in neither case cited above were the proprietary rights of the relevant social media accounts the subject of an agreement, it is still a far cry to purport that a claim to enforce such proprietary rights does not disclose a legal cause of action.

The message that has resounded clearly from the US courts, however, is that when a clearly written Non-Disclosure and Rights to Work Product Agreement was entered into at or near the inception of the employment relationship, the courts will enforce such obligations, and order an employee to give its employer access to a social media account. (See Ardis Health, LLC v. Nankivell, 2011 WL 4965172 (NRB) (S.D.N.Y., Oct. 19, 2011). Ardis is an invaluable lesson to employers who profit from their employees’ use of social media to carefully analyze these issues at the outset of an employment relationship. Employers must ensure that they are fully protected by a carefully and properly drafted agreement delineating their proprietary interests in employee work product, as unconventional as it may be, in order to avoid time-consuming and expensive litigation over ownership of social media accounts down the road.