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How much is a company’s Twitter account worth?

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Social media is big. And it’s getting bigger. There are more Facebook users today than there were people on the planet 200 years ago. Twitter recently celebrated its sixth birthday by announcing that the number of “tweets” per day has reached 340 million. Linkedin is growing at a rate of 100 million new members every week, the equivalent of a new member every second. 

With statistics like these, it’s no surprise that more and more businesses are tapping into the benefits of social media – increased brand visibility, enhanced profile and access to a potentially limitless client base.

In their rush to be “social” however, many businesses are failing to legislate for the pitfalls inherent in using social media – Facebook’s privacy record, for example, has been heavily criticised with hackers proving their point by accessing and posting private photos of CEO Mark Zuckerberg on the internet after working their way into his account. 

Many businesses are tasking employees with “fronting” social media campaigns on their behalves and encouraging staff to “link” with existing and new clients via LinkedIn, to enhance and generate relationships. What happens then when the employee leaves? Who owns the social media account and, more importantly, its followers?

The case of Phonedog LLC v Noah Kravitz, currently playing out in the US, acts as a warning of what can happen when things go wrong. Kravitz tweeted for US website Phonedog under the name @Phonedog_Noah. He changed his username when he left the company and took his 17,000 followers with him, prompting the company to seek damages of £217,000 on the basis that the followers constituted a customer database, which it had invested “substantial” resources into creating.

In support of its position, Phonedog stated:

“The costs and resources invested by Phonedog Media into growing its followers, fans and general brand awareness through social media are substantial and are considered property of Phonedog Media. We intend to aggressively protect our customer lists and confidential information, intellectual property, trademark and brands.”

As part of his counterclaim, Kravitz is claiming compensation for his efforts in attracting the followers during his employment in the event that Phonedog succeed.

The issue was highlighted in the UK last year when Laura Kuenssberg, the BBC’s chief political correspondent left to join ITV, taking her 60,000 twitter followers with her. Even Boris Johnson recently found himself at the centre of a social media scandal when he changed the name of his Twitter account from @mayoroflondon to @borisjohnson and bagged over 250,000 followers in the process. 

What Boris claims was a step aimed at “honesty and openness” has been branded by Ken Livingstone as “an abuse of public resources” which he claims resulted in the Conservative party “clearly benefiting from taxpayer-funded public servants who have built up an official mayoral Twitter feed”.

The fundamental problem for the Courts considering the Phonedog case, and for any business using social media, is that advances in this area have been so swift that the law is yet to catch up. The truth is nobody really knows who owns the social media account/followers when an employment relationship ends. 

Employers are increasingly seeking to categorise the contacts generated through and held on employee’s social media sites as “confidential” and akin to that traditionally held on laptops and mobile phones, in an attempt to secure its return post employment. 

Copyright law is also being called on, with employers claiming that such contact lists are “databases” owned by the company. Such arguments must surely be more forceful if the sites were worked on during an employee’s working hours and the contacts obtained on the back of the employer’s goodwill.

Given the continuing rise of social media, it is undoubtedly only a matter of time until the viability of such claims is tested in the English Courts. Until then, however, and in any event given the evolving nature of social media, the need for businesses to introduce protective measures is increasing. 

Such measures may include a review of existing Contracts of Employment and the adaptation of restrictive covenants to deal specifically with social media situations, the extension of the information recoverable by an employer following termination of the contract, clear guidelines for staff regarding ownership of contacts generated through social media and even an insistence on employees operating separate personal and professional accounts.

Hayley Devlin is a solicitor at Hamlins LLP.

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