The number of people using social media these days is staggering. For instance, Facebook has 1.65 billion monthly active users as of March 31, 2016. As such, the ability to reach such a broad consumer base through social media is becoming increasingly important to businesses. Companies are no doubt eager to create social media pages that generate “followers” and “likes” that may, in turn, generate profits. As the number of “followers” and “likes” of a page increase, so do potential issues surrounding ownership of these aspects of social media pages.
The current state of the law regarding social media and property rights is unsettled, so companies must be vigilant and keep up-to-date with any new developments in order to protect themselves in the event of a potential dispute. Recent cases shed some light on the current legal landscape regarding property rights and social media, which may provide some guidance for companies operating social media pages.
Who owns “likes?”
Mattocks v. Black Entertainment Television LLC, 43 F. Supp. 3d 1311 (S.D. Fla. 2014) tackled the issue of whether a person who creates a Facebook page owns the likes associated with it. Stacy Mattocks set up a fan page for a CW show “The Game” in 2008. BET acquired the rights to the show in 2010 and reached out to Mattocks to collaborate with her—ultimately hiring her part-time to manage the page while allowing her to use BET trademarks and exclusive content to promote the show. During the time Mattocks operated the page for BET, the page likes increased from two million to six million. When further employment negotiations broke down in 2012, Mattocks cut off BET’s access to the page. BET subsequently asked Facebook to deactivate the account and migrate the likes to an official BET page and Facebook complied.
Mattocks filed suit alleging, among other things, conversion of the likes of the Facebook page. The District Court held that Mattocks did not have a property interest in the likes of the page, since individual users could “unlike” at any time, and granted BET’s motion for summary judgment. Mattocks appealed to the 11th Circuit Court of Appeals, and with respect to the conversion claim, argued that the court erred in finding that she did not have a protectable property right in the “likes” she helped generate. The court, during oral argument, appeared to appreciate the apparent value in “likes,” acknowledging that “likes” are monetized and may entice advertisers. The court also alluded to the idea that the ability to “unlike” a page did not necessarily preclude it from being considered property. The appellate court, however, did not have an opportunity to issue an opinion. On April 26, 2016, BET and Mattocks settled, with undisclosed terms, and asked the court to dismiss the appeal.
Although the “likes” of social media pages may or may not be considered property, social media accounts are more likely to be considered as such, as illustrated in In re CTLI, LLC, 528 B.R. 359 (Bankr. S.D. Tex. 2015). The U. S. Bankruptcy Court for the Southern District of Texas held that business social media accounts are property interests under the bankruptcy code, and that social media accounts of the debtor in the case were property of the bankruptcy estate. The Court ordered that the Facebook and Twitter accounts of the former owner of the company be transferred to the reorganized debtor. The court’s opinion provides some clarity on the ownership of business social media accounts. That is, if the social media account is (1) created in the name of the business, (2) linked to the business’s web page, and (3) used for business purposes, the account is presumptively property of the business. Companies that could potentially become debtors should then be wary, as liens may extend to Facebook and Twitter “property.”
When implementing social media pages, companies must be mindful of potential ownership ramifications. A common theme throughout the rather sparse history of U.S. cases regarding property rights and social media is that contracts will often be upheld, driving home the importance of carefully drafted contracts concerning any employee or contractor employed to manage a social media page. Carefully drafted provisions can help protect a company’s rights. Companies must also be mindful of a social media provider’s terms of service when uploading content, as the courts seem to construe terms of the contract strictly and will enforce the contract in most cases.