Atharva Sontakke brings us his 2nd post in our SpicyIP Fellowship applicant series with this post looking into the oft neglected area of Trade Secret law, and how it interacts with the ‘ownership’ of social media contacts. Atharva is a 3rd year student at GNLU. His first post is available here: Cricket, Death and a Trademark! [The deadline for submission of entries for our Fellowship application has now passed. We shall be going over the submissions received thus far and will announce the winners soon].
‘Ownership’ of Social Media Contacts
By: Atharva Sontakke
Every business entity these days wants to be trending on social media. In pursuance of this, the Times of India came up with a bizarre social media policy for its employees in 2014. According to the policy, every employee is to maintain a social media profile on Facebook, Twitter, LinkedIn etc. to be used strictly for the purposes of the employment. The company would have the right to access the social media account and also to post content on behalf of the employee. The employee would be given the option of maintaining two separate accounts, i.e. personal and professional in which case the company would not interfere with the personal account. However, the policy says that the company would prefer employees operating with only one account. Some interesting legal questions can arise in situations involving employer-employee relationship. What happens to the accounts after the employee has left the company? More importantly, who owns the friend lists, followers or contacts created through the social media accounts of the employee?
For the company to claim any proprietary right over such lists or contacts it must be able to show that the list constitutes a trade secret or confidential information which the employee cannot own or use to the detriment of the employer. While considering such claims courts generally consider whether the information has any ‘quality of confidence’ about it and whether it carries any independent economic value for the owner. Also, to be called confidential such information must not be widely known or easily ascertainable and the owner must be shown to have made reasonable efforts to protect it. What follows is a brief summary of US trial court case laws regarding the issue after which I compare the position of law with the Indian position on the law of trade secrets.
- Eagle v. Morgan (2012)
In this case, Eagle, a former employee had created a LinkedIn account for developing business relations. The employer assisted in maintaining the account and also had the password to access the account. After termination of Eagle’s services, the employer changed her profile and the contents therein. The court held that all the LinkedIn connections belonged to the employee since she had created the account and the mere fact that the employer directs maintenance of the account does not give any proprietary rights to the company.
- PhoneDog LLC v. Kravitz (2012)
Here, Kravitz was hired by the company to review its products through Twitter. He used the Twitter handle created not only for the purposes of providing information related to the company’s products but also for his personal communications. After his service was terminated, Kravitz changed the name of the Twitter handle and continued using it with all the previous followers who now were following his personal handle. On being sued he argued that list of the followers is not capable of trade secret protection as it was already in the public domain for everyone to see. Eventually the case was settled in 2012.
A former employee hired specifically to maintain the social media presence of the employer was forced to return the passwords of the accounts to her former employers.
- Christou v. Beatport, LLC (2012)
Here, a promoter used to advertise some night clubs through a Myspace profile. Upon terminating the employment, he started promoting the competitors of the employer. The court held that there was a valid claim for trade secret protection since the contact list did not involve merely the names of the customers but also ancillary information like contact information, information about preferences and other personal information which is not easily ascertainable otherwise.
- Sasqua v. Courtney (2010)
A completely contradictory view was taken here by holding that LinkedIn connections do not qualify as confidential information as they are available in public domain and considering the proliferation of information on social media, it is not difficult to access such information. More specifically, the court took into account the nature of industry of the employee. The fact that her industry (financial services) was so vast and non-specialized like some other industries, no particular effort was required on the part of an employer to develop business relations with customers.
There is very little jurisprudence in India regarding what kind of information constitutes trade secret or confidential information. In American Express Bank v. Priya Puri (24th May, 2006), the Delhi High Court refused to grant an injunction to restrain an ex-employee from using customer list and other financial information related to customers of her previous employer bank. It held that the customer contacts were developed by the employee due to her own efforts and relationship with them. Also, by merely obtaining the information about the customers she does not gain any substantial advantage over her ex-employer.
However, just a few weeks earlier, in Diljeet Titus v. Alfred Adebare (8th May, 2006) the Delhi High Court had taken a slightly different view by focussing more on the nature of employment relationship to determine whether it implied any obligations of confidentiality. Observing that all the work done by the employee was only for the employer, there was a contract of service. Moreover, due to the nature of the industry (law firms) any information about clients and their contact information may carry substantial business value.
Comparing the case laws one could say that the question of ownership of social media accounts depends a lot on factual circumstances. But while deciding any such claims following factors may be crucial :
- Industry in question:
Value of contacts is much more in a highly specialized industry as it requires greater efforts to build those contacts and business relationships.
- Nature of Relationship and Control over the information:
If the employee worked specifically for promoting the company on social media, he may not be able to retain any contacts or followers as in Ardis Health. But if maintaining an online profile is only an ancillary part of his duties, he may have a claim depending upon whether he has invested personal efforts in developing those contacts.
Also, if the information consists of pre-existing contacts/list which has been acquired by the company as a whole and there is no substantial effort of the individual employee, as in Diljeet Titus, the employer is likely to own it. However, if contacts are developed because of personal involvement of an employee, which is more likely in social media scenario, the employer may not have any rights.
- Public disclosure:
Whether the lists, contacts or connections are already available in the public domain due to the very nature of social media is essentially a question of fact. It depends on several factors including any reasonable efforts on the part of the account holder to utilize privacy settings to not allow others to know of his connections or contacts.