Social Media and Intellectual Property – What is at Risk?

By Paul G. Gagne

Most businesses understand that social media – employed strategically and carefully – can be an invaluable tool for promoting a company and its brand. Most businesses also understand that there are many pitfalls inherent in the use of social media, but they may not be aware of exactly what those risks are. This article covers some of the intellectual property risks associated with promoting your business on social media sites.

  1. Have Clear Rules on Ownership of Social Media Accounts. When an employee creates or operates a social media account in the company’s name (for example, a branded company Twitter account), make certain that written policies or procedures provide clearly that the company owns the account, the content, and the followers.
  2. Keep an Eye on Freelancing Employees. Your employees may – with or without your knowledge and authorization – identify themselves as working for you on their personal websites. If you choose to allow this (and there may be good reasons to do so), make sure that you have clearly-articulated, written guidelines in place for what your employees are permitted to do and say. In particular, make sure that your employees are not disclosing your trade secrets, confidential marketing strategies or other information you need to keep out of the public eye.
  3. Back Up Your Intellectual Property! The Internet is forever, right? Everyone says so. Not so fast. Companies often post content to social media sites assuming that the content will be available forever. Make sure that you carefully review each site’s Terms and Conditions to make sure exactly what is being promised. Those terms may well provide that the site may shut down at any time, with or without notice to users, and with no obligation on the site’s part to back up, retain or return user content. If your content resides only on the site with no backup, your valuable intellectual property may be lost – forever.
  4. Make Sure Your Trade Secrets Stay Secret. Happy to have your knowledgeable employees out there on social media promoting your products or services? Great, but make sure they are bound by appropriate policies not to share confidential information or trade secrets such as formulas and know how, through social media accounts, whether the company’s official site or the employees’ private social media account. In addition to written procedures, make sure you educate your employees that the company’s secrets are just that – secret.
  5. Protect Your Brand When You Can. The unfortunate fact is that you cannot control the negative things that people – often taking advantage of the Internet’s cloak of anonymity – say about your company or of its products on social media sites. Develop a policy for how to monitor and react to negative social media postings. It won’t do your company – or its image – any good to chase after every Internet troll who criticizes your brand, but have a plan in place for when to take action, such as when truly damaging defamatory information or your trade secrets are posted for the online world to see.
  6. But Protect it Honestly. Companies are often tempted to buff their image by directing employees to pose as regular consumers and to post glowing reviews of the company’s goods or services on social media sites such as Yelp or Facebook, or on more traditional websites such as Amazon. This practice is illegal. In recent years, the Federal Trade Commission has been very active in enforcing its Endorsement Guidelines. Make yourself and your employees aware of the Guidelines. The most important thing to know is that anyone endorsing a product or service must disclose any “material connection” that they have with the producer of the goods or services.
  7. Have a Policy Regarding Ownership of User-Generated Content. If you decide to make your social media sites interactive by permitting users to submit their own content, such as photos or video, assess whether and to what extent you want to claim ownership of user-generated content. While claiming such rights may seem appealing, know that asserting ownership of content you did not create can expose your business to liability, for example, for defamation and copyright infringement, if users’ content violates – or is alleged to violate – the rights of others.
  8. Develop a Focused Social Media IP Protection Strategy. The vast number of social media sites and users make it nearly impossible to try to detect every infringement or abuse of your intellectual property rights. Determine what aspects of your intellectual property are most important to you and on which sites the most damaging forms of abuse are likely to occur.
  9. Beware of Cybersquatters. Cybersquatting has traditionally referred to the registration of a domain name identical or similar to the trade name of a company with the intent to profit by either benefiting from the company’s goodwill in that name, diverting potential customers to the registrant’s website for the squatter’s own purposes, or selling the domain name to the rightful holder for an inflated price. Beware that cybersquatting can also occur on social media sites, with miscreants registering Twitter, Facebook or other social media accounts in your company’s name in order to benefit from using a name that does not belong to them.

For more information on the potential intellectual property risks when promoting your business on social media, contact Paul G. Gagne at [email protected] or at 215-523-5302.