Uncertainty Reigns Over Ownership Of Social Media Content

In Mattocks v. Black Entertainment Television LLC, (S.D. Fla. 2014), the Southern District of Florida considered whether a Facebook user possesses an ownership interest in the Facebook “like” of another. From 2006 to 2009, the CW Network broadcasted the television series “The Game.” Stacey Mattocks (who was unaffiliated with the network) created an unofficial fan site using a Facebook page. Mattocks continued to maintain this unofficial Facebook page even after the CW canceled the show.

In 2010, Black Entertainment Television (BET) acquired syndication rights to televise “The Game,” and later acquired an exclusive license to produce new episodes. BET contacted Mattocks after learning about her unofficial Facebook page, eventually hiring her to manage it part-time for the network, according to the opinion.

BET added its trademarks and logos to the Facebook page, encouraged its viewers to “like” the page, and provided Mattocks with exclusive content to post. BET regularly instructed Mattocks to post, or not post, certain content, the opinion said. While Mattocks posted most of the content on the page, BET employees also occasionally posted material. During the time Mattocks worked for BET, the number of “likes” grew from around 2 million to over 6 million.

Shortly after Mattocks began working for BET, the parties entered into a letter agreement by which BET agreed not to exclude Mattocks from the page by changing her administrative rights. In exchange, Mattocks granted BET administrative access to the Facebook page and agreed BET could “update the content on the page from time to time as determined by BET in its sole discretion.”

Sometime in 2012, Mattocks restricted BET's access to the Facebook page to create leverage during renewed employment contract negotiations. In response, BET asked Facebook to “migrate” fans of the page to another, official page created by BET. Facebook granted BET's request, migrated the “likes” associated with the original page created by Mattocks, and shut down the original page.

Mattocks sued, asserting, among other things, that BET converted a business interest she had in the Facebook page ' namely, the “likes” it had accumulated while she worked on the page. The court, however, held Mattocks had no property interest in the “likes,” and thus, could not state a claim for conversion under Florida law.

According to the court, “'liking' a Facebook page simply means that the user is expressing his or her enjoyment or approval of the content. At any time ' the user is free to revoke the 'like' by clicking an 'unlike' button. So if anyone can be deemed to own the 'likes' on a page, it is the individual users responsible for them,” the court wrote. “Given the tenuous relationship between 'likes' on a Facebook page and the creator of the page, the 'likes' cannot be converted in the same manner as goodwill or other intangible business interests.”

Mattocks appealed the court's finding. But rather than settling the issue, the U.S. Court of Appeals for the Eleventh Circuit ordered the parties to mediation, warning that “an opinion of the court may set a precedent in a relatively unchartered area of law, which could have ramifications that businesses and individuals who operate Facebook pages dislike.”

Court Unfriends Decision In Mattocks

The U.S. Bankruptcy Court for the Southern District of Texas in In re CTLI LLC, (Bankr. S.D. Tex. 2015), reached the opposite conclusion as Mattocks, holding instead that social media accounts created to promote a business are assets of the business's bankruptcy estate, even though the debtor's former owner created the accounts in his name and claimed they were his property.

In CTLI, Jeremy Alcede, a majority owner of a gun store and shooting range, was ordered to transfer ownership to a minority shareholder under a reorganization plan, and to “deliver possession and control” of “passwords for the debtor's social media accounts, including but not limited to Facebook and Twitter” to the new owner. But Alcede refused to comply, leading to his being held in contempt of court, and, eventual, arrest.

Following a hearing, the court held the business's social media accounts fell within the broad definition of “property of the estate” in the U.S. Bankruptcy Code, 11 U.S.C. '541, and ruled the reorganized debtor was entitled to control the social media accounts. In holding the accounts were property of the estate ' and not Alcede's personal property ' the court considered a number of factors, including that: the Facebook page linked directly to the business's website; the page was used to post status updates promoting the business; and Alcede gave other employees access so they could post business-related updates. The court also noted that, in addition to providing personal user accounts, Facebook offers separate pages for “businesses, brands, and organizations.”

CTLI expressly rejected Mattocks' conclusion that the plaintiff there did not have a property interest in the “likes” on a Facebook page ' instead likening the social media accounts to “subscriber lists” that “provide valuable access to customers and potential customers.” The court added: “The fact that those customers and potential customers can opt out from future contact does not deprive the present access of value. Just as Facebook users can 'unlike' a page at any time, subscribers to e-mail lists can also, by federal law, opt out at any time.”

Implications: Who Owns Your Social Media?

The implications of recognizing ownership over social media are commercially significant, but far from clear.

A number of factors complicate the issue. First, social media sites provide terms and conditions governing the creation and usage of accounts. Facebook's terms, for instance, provide that an individual creating a user profile owns the content he or she posts. The terms also specifically provide: “You will not transfer your account (including any page or application you administer) to anyone without first getting [Facebook's] written permission.” This seems to suggest “likes” and other content are owned by the creators of individual social media accounts, subject to any licenses granted to the provider. But these terms and conditions are, of course, subject to change.

Second, parties may also enter agreements impacting these rights. For example, the letter agreement in Mattocks entitled BET to “full access” to the page Mattocks created “in every respect.”

Finally, legislators have begun considering (and enacting) laws impacting social media ownership and access. For example, the Uniform Law Commission drafted legislation with the intent to clarify that a person's digital assets become part of his or her estate after death in the same fashion tangible assets would. [Editor's Note: For more, see, "What Happens to Your Digital Estate After You Die?," by Jeffrey N. Rosenthal, in our Nov. 2014 issue.]

Given the complexity, it is no surprise the courts in Mattocks and CTLI disagreed as to whether social media accounts are a form of property. (Compare Eagle v. Morgan (E.D. Pa. Mar. 12, 2013) (under Pennsylvania law, plaintiff could not state a claim for conversion of a LinkedIn account because account is not tangible chattel, but instead, an intangible right to access a specific page on a computer) with PhoneDog v. Kravitz (N.D. Cal. Nov. 8, 2011) (employer stated a claim for conversion under California law where former employee had accumulated thousands of Twitter followers while promoting employer's business, and continued to use account in order to reach its followers after termination of his employment).)

As a result, until such time as uniformity of ownership over social media content is further developed, uncertainty will continue to reign.

Jeffrey N. Rosenthal is an attorney in Blank Rome's Philadelphia office.'He concentrates his complex corporate litigation practice on consumer and privacy class action defense, and'regularly publishes and presents on attorney ethics and social media law. He can be reached at [email protected]. Harrison M. Brown is an attorney in the firm's Los Angeles office.'His practice encompasses a wide range of business litigation and class action defense, with an emphasis on consumer fraud and privacy claims.'He can be reached at [email protected]. This article originally appeared in The Legal Intelligencer, the Philadelphia-based ALM sibling of Internet Law & Strategy.