SEC vs. Elon Musk: Sometimes securities laws and social media posts don’t mix

Caleb Segrest (US)By Caleb Segrest (US) on Posted in General

When Elon Musk, the Chairman and Chief Executive Officer of Tesla, Inc. (“Tesla”), posted to social media on August 7, 2018, that he was considering taking Tesla private at $420 per share and had secured funding, he caused a ripple in the markets and gained the attention of the United States Securities and Exchange Commission (“SEC”). As a result of the statement, the SEC filed a lawsuit against Musk in the United States District Court for the Southern District of New York for allegedly violating Section 10(b) of the federal Securities Exchange Act of 1934 (the “Exchange Act”) and SEC Rule 10b-5 due to the allegedly false and misleading nature of Musk’s statements. Continue reading

Court-ordered social media disclosure

Susan Ross (US)By Susan Ross (US) on Posted in Social media policies

On August 30, 2018, a federal trial court in Texas ordered a defendant to include a disclaimer on certain social media posts as part of a preliminary injunction in a private litigation. (WorldVentures Marketing, LLC v. Rogers, 4:18-cv-00498 (E.D. Tex. Aug. 30, 2018) (2018 WL 4169049)). Continue reading

Texas lawyers and social media

Andrea Shannon (US)By Andrea Shannon (US) on Posted in General

Texas lawyers are permitted to ask their lawyer friends on social media for help with legal questions on behalf of their clients, according to a recent opinion from the State Bar of Texas’ Professional Ethics Committee (“PEC”). The PEC is a committee appointed by the Texas Supreme Court that issues opinions on various ethics and professional responsibility questions posed by members of the State Bar of Texas.

Opinion No. 673, issued in August, addressed two questions: 1) Does a lawyer violate the Texas Disciplinary Rules of Professional Conduct by seeking advice on behalf of a client from other lawyers in an online discussion group? 2) What if the lawyer asks another lawyer at a different firm in an informal consultation or discussion? According to the PEC, the answer to both is that the conduct does not violate the rules, subject to a few limitations and exceptions. Continue reading

Internet reviews and the Communications Decency Act of 1996

Caleb Segrest (US)By Caleb Segrest (US) on Posted in Defamation

We have previously written about the U.S. legal landscape regarding consumers’ rights to post negative reviews of products or services on the internet, including some of the implications of the Consumer Review Fairness Act on these rights. The Consumer Review Fairness Act was passed in December of 2016 in response to some businesses’ efforts to prevent customers from giving honest reviews by signing non-disparagement or similar agreements as a condition to receiving a particular product or service.

This post concerns an issue involving the federal Communications Decency Act of 1996 (the “CDA”) and its relationship to rights and obligations of companies that provide a forum for reviews and ratings of businesses (the “review sites”), the reviewers, and the businesses that are reviewed. In July of this year, the Supreme Court of California issued an opinion, styled Hassell v. Bird, that analyzed the relationship of these entities and provided some guidance and clarity as to legal rights provided by the CDA in this context. Continue reading

The new age of cyberbullying

Daniel DanieleBy Daniel Daniele on Posted in General

There has been an increase in cyberbullying with the rise of social media. According to the Canadian government, “cyberbullying involves the use of communication technologies … to repeatedly intimidate or harass others”. Federal and provincial governments have effected legislative change to make harmful cyberbullying behaviours criminal or at least provide civil remedies for those harmed. Other methods of deterring cyberbullying include education and policies implemented by social media platforms. Cyberbullying is not limited to children and teens. Similar to schools, workplaces should have policies and guidelines in place which provide for a safe environment for their employees. Continue reading

Grumpy Cat back in court

Stephanie Schmidt (US)By Stephanie Schmidt (US) on Posted in Copyright, Litigation, Trademark

We previously reported on Grumpy Cat Limited’s big win in a copyright and trademark suit. As a recap, Grumpy Cat—the social-media-famous grimacing feline, or rather the holding company owned by her “parents”—filed a lawsuit after the defendants went beyond the scope of a licensing agreement to market a variety of Grumpy Cat-themed coffee products. According to the suit, the contract was only intended to cover bottled iced-coffee beverages called Grumpuccinos.

Though judgment was entered, the tale is not over yet. Grumpy Cat Limited recently asked the court to award it over $320,000 in costs and attorneys’ fees from the defendants, Nick and Paul Sandford of Grenade Beverages (later renamed Grumpy Beverages LLC). Continue reading

Social media activities and the appearance of bias

Joy Wang (US)By Joy Wang (US) on Posted in General

On June 21, 2018, the U.S. Supreme Court declined to decide the question of whether a district court judge is required to retroactively recuse himself when he allegedly follows the federal prosecutors on Twitter and, within hours after denying relief to the defendants, tweeted a link to an allegedly erroneous news article with a title implying that the defendants were liable. The relevant 9th Circuit opinion here is U.S. v. Sierra Pacific Industries, Inc., which was published on July 13, 2017. Continue reading

Mirror, mirror on the wall, what’s my taxable Insta value after all?

Georgina Hey (AU)Isobel Taylor (AU)By Georgina Hey (AU) and Isobel Taylor (AU) on Posted in General

In sad news for celebrities and Instagram influencers across Australia, the introduction of the so-called ‘fame tax’ as part of a raft of integrity measures announced in the 2018/19 budget means that they could end up paying higher taxes on the income and non-cash benefits earned through the commercial exploitation of their image rights.

In this article, we explore the impact of the changes on individuals who currently use a separate entity to cash in on their image rights. Continue reading

Trademarks, social media and lessons learned

Susan Ross (US)By Susan Ross (US) on Posted in Trademark

On June 14, 2018, a federal trial court in New York issued a decision relating to a restaurant owner’s claim that the restaurant manager was using the owner’s trademarks on social media in violation of the federal trademark law known as the Lanham Act. The trial court denied the owner’s claim, in a ruling that provides some useful lessons to anyone who licenses a trademark. (Thousand Island Park Corp. v. Welser, 5:18-CV-117 (N.D.N.Y. June 14, 2018 (2018 WL 29803231)).) Continue reading

NLRB issues new guidance on employer policies

Matt Heller (US)By Matt Heller (US) on Posted in Employment and labor, Social media policies

In the wake of the National Labor Relations Board’s (NLRB) decision in The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017), the NLRB has recently issued new guidance regarding employee handbook rules. The NLRB’s guidance can be found here.

In Boeing, the Board overturned its old standard, under which an employer rule violated the National Labor Relations Act (NLRA) if a worker could “reasonably construe” it to interfere with the right to engage in protected concerted activity. Under the new standard adopted by the Board, an employer rule will only violate the NLRA if it would be reasonably interpreted to interfere with workers’ NLRA rights considering the balance between (A) the nature and extent of the rule’s potential impact on protected rights and (B) the employer’s legitimate justifications for the rule. Continue reading

LexBlog