As social media has taken an increasingly central role in building brands and promoting businesses, in-house counsel need to keep related legal issues top-of-mind.
Social media sometimes inspires questions without clear answers from the rules that govern traditional – i.e., television, radio, print – marketing and advertising. For example, when do social posts count as “advertising”? (Answer: When such posts promote brand recognition and loyalty, regardless of whether they solicit viewers to purchase a product or service.) Also, unlike traditional media, social media marketing can be created and distributed at lightning speed, sometimes bypassing traditional clearance processes.
Social media mistakes can be costly. In 2014, American actor Katherine Heigl sued Duane Reade for $6 million after it retweeted a candid photo of Ms. Heigl carrying a Duane Reade bag (the case settled for an undisclosed amount). In 2010, the wire service Agence France Presse (AFP) and photo agency Getty Images redistributed photos posted on Twitter without authorization, for which a jury ultimately awarded more than $1.2 million in damages to the photographer. In addition to legal exposure, the practical risk of a platform reducing your company’s social media presence due to infringing content, even for short amounts of time, can have significant monetary and reputational consequences.
In short, social media marketing carries significant financial and branding risk. It is imperative to approach social media with as much thoughtfulness and sophistication as traditional marketing (maybe even more, since it can go viral so quickly!) – understanding its inherent risks and putting in place effective policies.
1. Right of Publicity Risk Factors
The federal Lanham Act and state right of publicity laws give people commercial control over their name, likeness, and persona (“identity”). Unauthorized use of an individual’s identity may falsely imply association or sponsorship. This is precisely the claim Ms. Heigl made against Duane Reade after it retweeted a paparazzi photo of Heigl walking out of a Duane Reade with the caption “Even @KatieHeigl can’t resist shopping at #NYC’s favorite drugstore.”
The right of publicity is not limited to celebrities. For example, posting the photo of a customer using your company’s product could open your company up to liability, even if the customer posted the photo initially or even tagged your company in the post. Defenses are subjective and frequently insufficient to defeat a publicity claim. As the Heigl v. Duane Reade case illustrates, a few taps can trigger significant potential liability. Social media does not eliminate the need for right of publicity releases, and therefore a best practice is to always contact the person to get permission before reposting.
2. Copyright Risk Factors
Every new employee on the marketing team should be required to memorize and recite the following sentence: “The Retweet and Share buttons are not a license.” Marketing teams must remember that online content is generally not legally available for promotional use. This is a risky area because: (1) copyright protection does not require a registration or a copyright notice; and (2) many attorneys and photographers use bots to troll for infringing content. Your team should assume that online content is protected and seek authorization before using it.
Some believe that “fair use” provides broad protection/defense. However, the Fair Use defense is often subjective, making it possible for cases with nearly identical facts to come out differently. For example, in two similar cases involving the unlicensed use of a photograph in a political ad, a United States District Court in Colorado rejected the fair use defense while a United States District Court in Montana accepted it. Compare Hill v. Public Advocate of the United States, 35 F. Supp. 3d 1347 (D. Colo. 2014) and Peterman v. Republican National Committee, 369 F. Supp. 3d 1053 (D. Mont. 2019). As a practical matter, it may be cheaper to obtain a license than to litigate.
3. Confirm Your Rights in Your Company’s Original Content
Similarly, your marketing team should always confirm rights before use, even for original content. For example, sponsorship of an event does not give your company a license to all the intellectual property at the event (e.g., the music that may be played or the photos that are taken at the event). In particular, photographers who are not employees own the copyright in their photos unless and until they have assigned their rights. This is true even if the subject of the photograph would like to use the photo (e.g., both American actor Jennifer Lopez and American TV celebrity Khloe Kardashian were sued for copyright infringement when they posted photos of themselves on their Instagram accounts without authorization from the photographer). On the flip side, subjects of the photo must agree to have their likeness used for promotional purposes. Therefore, be sure to get permission from any employee, customer or other person who appears in promotional photographs.
4. Trademark Risk Factors
Use of a third party’s trademark can also create a likelihood of consumer confusion as to the source of the product or falsely imply partnership or endorsement. Trademark claims pose somewhat lower practical risk than other infringement claims due to a higher bar for liability, more difficulty proving damages and a high bar for recovery of attorney’s fees (which are only available in “exceptional” cases). Nevertheless, use of third party marks can create significant exposure, even in referential contexts such as hashtags.
As with copyright, there is danger in relying on institutional assumptions about the scope of the fair use doctrine. Courts evaluating a fair use defense to a trademark claim may examine many factors, including whether the use of the plaintiff’s mark is necessary to describe both the plaintiff’s and defendant’s product or services, whether the defendant uses only enough of the plaintiff’s mark that is necessary to identify their own product or service, and whether the defendant did anything, on top of using the plaintiff’s mark to suggest a true relationship or endorsement by the plaintiff mark holder. Post facto reliance on the fair use doctrine after a claim arises is frequently no more reliable than a coin toss.
5. Compliance with Social Media Terms & Conditions
The use of social media websites and applications to promote your brand should comply with the guidelines of that social media platform. For example, some platforms only allow users to post photos they are authorized to sublicense. Repeated violations of a platform’s terms can risk deactivation of your account – a potentially catastrophic event. (Tip: The terms and conditions are generally available on each platform’s website, usually found in the footer along with other helpful links, such as contact information).
Promotional contests and giveaways on social media must abide by the platform’s specific rules and all applicable state laws. Companies must draft and post Official Rules for their promotions in compliance with state laws, some of which require additional advertising requirements and disclosures to be included in promotion posts. Platform-specific requirements can include disclaimers of sponsorship and liability releases, prohibitions on particular promotion methods and other detailed obligations. These terms can also change unexpectedly. Before launching a promotion, your team should be sure they have checked and comply with all the relevant law and platform terms.
7. Federal Trade Commission (FTC) Guidelines – Disclaimer [#ad] Needed for Endorsement Posts
Pursuant to the FTC’s Guidelines, people who post about or endorse your products must clearly disclose any connection with your company (e.g., use #ad or #sponsored in any post about a product that the company sent for free or paid the influencer for posting). Under the FTC rules, “endorsements” include posting, tagging, liking, “pinning,” commenting on, and providing reviews. The FTC guidelines provide helpful examples.
8. Product Liability Issues
When advertising a product on social media, promotions must show the product as it is meant to be used. When consumers use social media to lodge complaints or raise questions about a product, your team should think carefully about the substance of their response and whether the response should be private or public (both of which could increase or mitigate risk, depending on the specific issues involved).
9. Implement Social Media Policies
Companies should implement policies on use of the company’s social media and personal social media (if work-related). Many companies post their policies, providing helpful reference points. Depending on the size and structure of your company, you may wish to establish a review process before posting on your company/brand’s official accounts (though such a process may conflict with the immediacy that makes social marketing powerful, so some calculated risk may be acceptable).
10. When Mistakes Happen
Mistakes will occur. Have a plan in place to get problematic content down quickly. Social media makes it impossible to put the genie back in the bottle, but risk and exposure can increase dramatically if content lingers. Ensure that account credentials are available to key personnel so that complaints can be addressed promptly. Also review ownership periodically and confirm that company accounts belong to the company rather than individual employees (or unknown third parties).
With editorial assistance from Kathleen Wilt and Lewis Craft