Insulating Your Business against Twitter Defections

The PhoneDog Suit

In October 2010, Noah Kravitz left his position as the editor-in-chief of PhoneDog.com. While employed by PhoneDog, Kravitz became so influential in the sphere of mobile phone reviews that his videos, blogs, and reviews were watched by millions, and he was considered one of the most influential people in the industry. To reach the public, Kravitz communicated through a variety of social media outlets, including a Twitter account under the user name @PhoneDog_Noah.

When Kravitz left PhoneDog, the company asked him to turn over the Twitter account, which had 17,000 followers. Kravitz refused. Instead, he changed the Twitter account username to @noahkravitz. Because Twitter allows users to change usernames at will without losing followers, Kravitz retained the 17,000 followers he had accumulated while at PhoneDog.

PhoneDog sued Kravitz in federal court, alleging that Kravitz improperly took company resources, misappropriated its trade secrets and was liable for interference with economic advantage. From the employer’s perspective, Kravitz had diverted the attention and focus of 17,000 PhoneDog.com fans, depriving the company of those relationships and allowing Kravitz to tweet about other matters, including potentially competitive businesses, and to draw those followers’ attention and resources to another company.

Kravitz’ counsel tried to get the matter dismissed early, but the court concluded that PhoneDog had stated a claim as to misappropriation of trade secrets and conversion, and allowed the case to proceed.

What’s a Better Way to Handle This Situation?

The PhoneDog v. Kravitz case is just the latest in a recent spate of litigation over who should own or control Twitter accounts when an employee changes jobs. Employers whose employees or contractors have accounts that may migrate, taking followers, fans or subscribers with them, should review existing employment policies and written contracts to address who owns the accounts and to strengthen protections for the business where appropriate. Issues to consider include content of employee handbooks, employment contracts, and employee’s free speech rights.

First, make sure that the company owns the social media accounts that are its primary methods of communicating with the public. Just as the company should hold the office lease in its own name, it should also be the named owner and registrant of the blog website, the Facebook account, the Twitter account, and other social media points of contact.

Second, employees and independent contractors should be directed to communicate with the public on behalf of the business or brand through the company accounts, rather than their personal accounts. If the business wants to have multiple accounts for different corporate representatives, it should still ensure that those accounts are business accounts, owned by the employer. Not only does this help protect the business’ ownership of those accounts, it allows the company to prevent personal use of the accounts, so the public hears about the business, but not about the employee’s personal life.

A comprehensive employee handbook will address use of social media, and for employees involved in marketing or public relations, a written agreement should spell out the ownership of the accounts and approved and prohibited types of communications. A well-drafted agreement should do all of the following:

• Provide guidelines for communications that leave the employee or contractor with room to communicate quickly and continuously with fans or followers (without having to get approval for every communication from layers of managers), but prevent communications that could embarrass the company or create liability as a result of harassment, defamation or a lapse in judgment.
• Require the employee to notify the employer every time the employee changes the password for the account or makes any other substantive administrative change.
• Prohibit use of the account in a way that affects the business’ branding or marketing goals, such as changing account backgrounds, icon pictures, usernames or identifying information.
• Employers should also ensure that these company spokespeople are kept in the loop (or instructed to stay silent) in the event of significant corporate events, such as a merger or takeover, or a scandal in the industry, until the company’s position has been determined. Twitter and Facebook comments are quoted and shared frequently when they contain surprising or embarrassing admissions or gaffes. Businesses should treat statements made through those accounts the same as press releases.

Also keep in mind that the First Amendment and various laws limit a company’s ability to prevent its employees from using their own personal social media accounts to comment on their employer. The National Labor Relations Board has filed recent unfair labor practice charges against employers who disciplined or discharged employees for commenting on working conditions, employee compensation, treatment by supervisors, service to customers and the like. Any employment policy should be drafted carefully so that it does not overstate the employer’s authority over employees’ use of social media outside of the office.