Californian Noah Kravitz is being sued by his ex employer PhoneDog after he changed the password on the Twitter account he set up at PhoneDog.. PhoneDog wants damages of $340,000, that’s $2.50 for each of the 17,000 followers Kravitz accrued in post. Nicola Doran and Chris Stack look at this and a similar UK case over LinkedIn contacts.
Topic: Social media
Cases: PhoneDog v Noah Kravitz and Hays Specialist Recruitment (Holdings) Limited and Another v Ions and Another
Where: California, USA and UK
When: November 2011 and 2008
Law stated as at: 1 March 2012
With the use of social media becoming ever more prolific, employers' business contacts and confidential information come under greater risk.
LinkedIn in particular presents challenges for employers as a networking site aimed at use in a professional context, but which remains controlled by the individual. With many organisations now encouraging the use of LinkedIn and Twitter to build contacts and increase visibility, and as the line between professional and personal use becomes increasingly blurred, how can employers protect their business? We examine two recent cases to find out.
Mr Noah Kravitz worked for PhoneDog.com ("PhoneDog"), which describes itself as a "leading community of cell phone related information; blogs, forums, news, reviews…" In order to attract hits on the PhoneDog site, PhoneDog and Mr Kravitz employed the use of a Twitter account.
Using the Twitter handle of @PhoneDog_noah, Mr Kravitz was able to attract approximately 17,000 followers, each of whom received updates regarding Mr Kravtiz's thoughts on various mobile phones, as well as some of his personal opinions on other topics.
Upon his departure from PhoneDog in October 2010, Mr Kravitz changed his Twitter handle to @noahkravitz, but continued to use the same Twitter account, effectively taking all 17,000 followers with him.
PhoneDog brought a claim against Mr Kravitz for misappropriation of trade secrets under California law. PhoneDog asserted that the Twitter account had been developed and maintained for the sole purpose of driving internet traffic to the PhoneDog website and for the sole benefit of PhoneDog. It was asserted that the password to that account therefore constituted proprietary, confidential information belonging to PhoneDog.
Mr Kravitz filed an application to have the claim dismissed on the basis that it was without any merit. He argued that the followers of the account were not secret or confidential information because they are and have been publicly available for all to see at all times. He also claimed that the password has no economic value. The judge however found that PhoneDog's claim was plausible and allowed the claim to proceed.
The case, as they say, continues.
UK case focuses on LinkedIn contacts
In a similar vein, the UK courts previously dealt with a potential claim by Hays Recruitment after it came to light that an ex-employee (Mr Ions) had deliberately migrated details of business contacts from Hays' confidential database to his personal account at LinkedIn.
Mr Ions argued that the migration was carried out with Hays' consent (since it had encouraged him to join LinkedIn) and that, once the business contact had accepted the invitation, the information ceased to be confidential as it could be seen by all Mr Ions' contacts.
Hays made an application to the High Court for pre-action disclosure. The High Court held that Hays had reasonable grounds for making a claim and ordered pre-action disclosure of certain documents.
Since then there has been little publicity about the case and it may have been settled on confidential terms following this initial judgment.
What action can employers take?
These cases demonstrate the importance of having robust policies and procedures in place governing the use of social networking sites and the ownership of company contacts. If PhoneDog and Hays had had clear policies in place documenting who the contacts/information belonged to, it may have avoided having to revert to the courts to resolve these issues.
Where the use of social media is encouraged as part of employees' roles, employers are advised to set up new Twitter or LinkedIn accounts for business purposes only, ensuring clear demarcation of the line between personal and private.
Also, a good social media policy will clarify that any passwords to such accounts are the property of the employer and that those accounts will be deleted on termination of employment (or that the employee will not be permitted to continue their use).
Employers may also find it useful to go through a process of ring-fencing contacts existent on employees' social media sites at the commencement of employment, making it possible to agree that any contacts formed subsequently in the course of employment belong to the business.
If these steps are taken, it will make it difficult for an employee to subsequently argue that they are entitled to take the employer's contacts/information with them when they leave.