Ownership of LinkedIn Contacts

Hays Specialist Recruitment (Holdings) Limited v Ions [2008] is the key UK decision dealing with the ownership of LinkedIn contacts in the employment context.

Mr. Ions worked as a recruiter with Hays before leaving and setting up a rival business. Hays suspected Mr. Ions of using confidential information concerning clients and contacts which he had copied from the Hays’ client database to his personal LinkedIn account.

Hays inspected Mr. Ions’ email account and found evidence that he had invited two of Hays’ clients to join his network on LinkedIn but had suspicions that he had invited more. As a result Hays sought pre-trial disclosure from Mr. Ions.

In correspondence between Mr. Ions and Hays’ solicitors, Hays demanded full details of Mr. Ions’ Hays’ linked contacts and warned Mr. Ions to preserve all evidence. Although Mr. Ions informed Hays that he had arranged for his LinkedIn account to be fully deleted and that he had not kept a copy of the contacts, the US operator of LinkedIn agreed to preserve all evidence, including the entirety of Mr. Ions’ LinkedIn account, pending the outcome of the case.

Mr. Ions argued that Hays had consented to his use of LinkedIn and had in fact encouraged him to use it to connect with clients. Mr. Ions also argued that once an invitation on LinkedIn has been accepted by a contact, this information ceased to be confidential because it was then accessible by others on LinkedIn.

The Court did not accept this and noted that even if Hays had given Mr. Ions authority to use client email addresses to invite clients to connect with him, it was unlikely that this authority extended to the use of such information beyond his employment with Hays.

The Court ordered Mr. Ions to disclose the LinkedIn business contacts which he had acquired during his employment with Hays and all emails sent to, or received by, his LinkedIn account from Hays’ computer network during his employment. Mr. Ions was also ordered to disclose all documents, including invoices and emails, evidencing his use of the LinkedIn contacts and any business obtained from them.

The recent US decision in Eagle v EdComm (12 March, 2013) highlighted the importance for both employers and employees of having a Social Media Policy in place that addresses the ownership of social media accounts and contacts made by an employee during his/her employment.

Dr. Eagle was a co-founder and former CEO of EdComm, Inc. During her employment she set up and maintained, with the assistance of a colleague, a LinkedIn account to promote herself and EdComm. As a result, this colleague knew Dr. Eagle’s account password. After Edcomm was later sold and Dr. Eagle’s employment was terminated, the new owners changed Dr. Eagle’s LinkedIn password, removed her name and photograph from her LinkedIn profile page and changed the account profile to display Dr. Eagle’s successor’s name and photograph. Dr. Eagle’s honours, awards, recommendations, and connections, however, were unchanged. People searching for Dr. Eagle on LinkedIn were directed to Dr. Eagle’s LinkedIn profile that contained Edcomm’s new CEO’s information.

Dr. Eagle issued proceedings against EdComm for illegally taking control of and accessing her personnel LinkedIn account, and for its unauthorised use of the account. Finding in Dr. Eagle’s favour, the Court noted that a considerable downfall for EdComm was the absence of a Social Media Policy addressing the ownership of an employee’s social media accounts and contacts.

It is worth noting that although the Court found in Dr. Eagle’s favour, it did not make any award of damages as Dr. Eagle had failed to provide sufficient evidence of financial loss. Dr. Eagle did not point to a single contract, client, or deal that she lost because of her lack of access to her LinkedIn account.

Putting a Value on Twitter Followers

The US case of PhoneDog, LLC v Mr. Noah Kravitz (2011) provides a useful insight on an employer who endeavoured to put a financial value on an employee’s Twitter followers in proceedings.

During Mr. Kravitz’s employment with PhoneDog, a company that runs a mobile phone review website, Mr. Kravitz set up a Twitter account called @PhoneDog_Noah which he used almost exclusively to promote PhoneDog. PhoneDog invested financially in raising Mr. Kravitz’s profile, and in turn, the @PhoneDog_Noah Twitter account. Over time Mr. Kravitz amassed 17,000 Twitter followers. When Mr. Kravitz left PhoneDog, he changed his Twitter handle to @noahkravitz but retained his 17,000 followers.

Eight months after Mr. Kravitz’s departure, PhoneDog issued civil proceedings against Mr. Kravitz claiming that he owed them $340,000 for the 17,000 Twitter followers it claimed PhoneDog owned ie. $2.50 per Twitter follower per month since Mr. Kravitz had left the company.

PhoneDog submitted that since Mr. Kravitz had changed the handle of his Twitter account the company had lost advertising revenue. PhoneDog claimed that there had been a drop in traffic being directed from the @PhoneDog_Noah Twitter account to the PhoneDog website and advertisers were therefore discouraged from placing advertisements on the website.

The case was dealt with through mediation for 18 months and the matter was ultimately settled. The terms of the settlement remain confidential but Mr. Kravitz retained his Twitter account and his followers. So while the value of Mr. Kravitz’s Twitter followers was not determined by a court, the case is interesting because of the steps which PhoneDog took to place a value on Mr. Kravitz’s contacts.

Recommended Steps for Employers 1. Be Proactive

Employers should address the ownership of social media accounts and contacts made by an employee at the beginning of the employment relationship and throughout its duration. Employers intending to assert ownership over such social media accounts and contacts need to effectively communicate their intentions to their employees.

2. Social Media Policy

Employers should ensure that a Social Media Policy is in place that addresses the ownership of social media contacts. A Social Media Policy should clearly define work related social media contacts as distinct from personal contacts and should be tailored to the business operations of the company. It is important that employers effectively communicate their Social Media Policy to all employees and can demonstrate that it has been communicated.

3. Agreement as Condition of Employment

All employees using corporate branded or other official company social media accounts should sign an agreement as a condition of their employment that addresses the following points:

  • The employer, and not the employee, owns the social media account and the associated contacts
  • The employer has access to the account at all times
  • Only the employer is allowed to change account names and settings
  • All social media accounts, including login details and passwords must be relinquished at the end of the employment
  • A specific definition of what constitutes a social media contact in the context of the particular agreement

4. Restrictive Covenants

Employers should include non-dealing and non-solicitation restrictive covenants in employees’ contracts of employment and any severance agreements with a specific reference to online networking. However, any restrictive covenant should go no further than what is necessary to protect the company’s legitimate business interests to ensure, as far as is possible, that such clauses will be enforced, if challenged by a court.

Conclusion

Employers should adopt a balanced and pragmatic approach to the ownership of social media accounts and contacts made by an employee during his/her employment. If the purpose of someone’s social media account is personal or even quasi-business, it might be considered unreasonable for an employer to claim ownership of it. If the site is primarily for a business purpose however, the employer might have a stronger argument, such as when social media marketers, executives and salespeople use a social media account for company business.

By addressing the issue of ownership of social media contacts at the outset of the employment relationship and taking the above recommended steps, employers can protect social media assets