NLRB Judge Rejects Company Mandated Disclaimer on Employee Social Media Sites

An NLRB administrative law judge recently found various provisions of The Kroger Co. of Michigan’s online communications policy to be impermissible. One such provision includes a company mandated disclaimer to be used by employees when they identify themselves as being associated with the company or publishing anything about the company.  The decision reflects the importance of carefully crafting corporate social media policies with one eye on protecting the organization and the other on compliance with the National Labor Relations Act.

The offending disclaimer provision reads, “If you identify yourself as an associate of the Company and publish any work-related information online, you must use this disclaimer: “The postings on this site are my own and do not necessarily represent the postings, strategies or opinions of the Kroger Co. family of stores.”

Administrative Law Judge David I. Goldman writes, “The ultimate issue, then, is whether requiring a disclaimer for every posting by an individual identified as a Kroger employee that conveys “work-related” information unduly burdens legitimate Section 7 communication to an extent that would be likely to chill employees’ willingness to engage in it.”  Section 7 of the Act provides:

Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities.

The issue as framed by the ALJ was answered in the affirmative.  “Kroger’s rule is manifestly broader than its legitimate interest.  It seeks to protect Kroger’s interest by requiring the imposition of a disclaimer on every identifiabl[y]-employee communication conveying work-related information.”  Earlier in the decision ALJ Goldman notes, “It would include an online comment made in response to a news article, on Facebook, blogs –examples are endless.”

This recent decision continues to make the balance between managing one’s corporate reputation and adhering to federal law particularly challenging within the context of online communications.

You can read the full decision here.  

Court Rejects Lawsuit against Facebook Claiming Misuse of Minors’ Photos

A U.S. District Court Judge has dismissed a proposed class action lawsuit against Facebook. The suit claimed that the social media company is impermissibly using the names and likenesses of minors in its advertising.

Judge Richard Seeborg, of the U.S. District Court for the Northern District of California, rejected the plaintiff’s assertion that, even if permission for such use was acquired via the plaintiffs’ acceptance of Facebook’s Statement of Rights and Responsibilities (“SRRs”,) since the plaintiff class is made up solely of minors the SRRs are unenforceable against them under California law.  Judge Seeborg writes, “Plaintiffs’ arguments largely flow from an opposite and incorrect presumption, that minors generally do not have the power to contract.”  Under California’s Family Code §6710, “Except as otherwise provided by statute, a contract of a minor may be disaffirmed by the minor before majority or within a reasonable time afterwards or, in case of the minor’s death within that period, by the minor’s heirs or personal representative.”  “Although this section almost certainly would allow [p]laintiffs to disaffirm the SRRs, they have never plainly expressed an intent to do so, and they do not dispute that they continued to use their Facebook accounts long after this action was filed.  While Plaintiffs argue that a minor may disaffirm a contract without restoring any of the benefits he or she has received, they have offered no explanation as to how the principle would somehow retroactively vitiate the consent they had given through the SRRs at the time their names and profile pictures were used,” writes Judge Seeborg. 

According to Facebook it only republishes information users have already voluntarily shared with certain Facebook friends with those very same friends and “sometimes alongside a related advertisement.”

The order dismissing the complaint is available here.

James Dean Rumbles With Twitter Over Alleged Trademark Infringement

A complaint, originally filed in an Indiana state court, was moved to federal court last week alleging that Twitter’s failure to terminate the @JamesDean handle and site violates various laws including, among other laws, right of publicity, trademark infringement and false endorsement under the Lanham Act.

Indiana, which is home to one of the most expansive right of publicity laws, is also home to CMG Worldwide, which manages the commercial estates and licensing rights of many deceased celebrities, including James Dean.  The complaint was brought by James Dean, Inc. against both Twitter and certain John Doe defendants who are the currently unidentified owners of the James Dean Twitter site.  According to the complaint, “On numerous occasions since October 11, 2012, CMG, by and on behalf of its client, JDI, has contacted TI [Twitter, Inc.] in an attempt to have the Unauthorized Use’…’ceased.” 

The complaint notes that JDI holds federally registered trademarks to the James Dean name and that both Twitter’s and Does’ conduct “is likely to cause confusion, to cause mistake, or to deceive as to source, sponsorship, connection, association or affiliation between CMG, JDI, and TI and Does.”  The JDI complaint also asserts both Indiana state statutory and common law right of publicity violations.  Among other remedies, the complaint seeks an injunction requiring Twitter to turn over the names of the site’s owners, which Twitter has so far refused to do.  Interestingly, in correspondence attached to the complaint, CMG in early correspondence with Twitter asserts that the @JamesDean site is in violation of Twitter’s own trademark policy and guidelines for “Fan Accounts,” writing “First, you state that ‘the username should not be the trademarked name of the subject of the news feed, commentary, or fan account. Here, the subject of the Twitter feed is James Dean, and the username @JamesDean consists solely of the trademarked name.  Second, you state that ‘[t]he profile name should not be the trademarked name of the company or include the trademarked name in a misleading manner.  The profile name for the account in question is listed as ‘James Dean.”  “Your third guideline states, “The bio should include a statement to distinguish it from the real company, such as ‘Unofficial Account,’ ‘Fan Account’ or ‘Not affiliated with…”.  The @JamesDean account’s bio contains none of these distinguishing statements.” 

A piece in the Hollywood Reporter notes, “Over the years there have been many disputes over Twitter handles, but not quite like this one.  The social media site has an “impersonation policy” that forbids accounts portraying another person in a confusing or deceptive manner as well as a trademark policy,” but apparently the service has drawn a line in the sand when it comes to dead celebrities.”

Tweet in NY Times Ad Ruffles Feathers

The BBC reports that a full page advertisement appearing in The New York Times, which included an actual tweet, raises copyright concerns regarding the reprinting of tweets for such purposes.

The ad was a promotion for the film, Inside Llewyn Davis and the tweet belonged to the New York Times’ very own film critic, A.O. Scott.  Scott, apparently a fan of the Inside Llewyn Davis soundtrack, tweeted, “You all keep fighting about Wolf of Wall St. and Am Hustle. I’m gonna listen to the Llewyn Davis album again.  Fare thee well, my honeys.”  Scott said the firm behind the full-page ad had originally sought his permission to use a portion of the tweet, which he denied stating that it was “a slippery slope and contrary to the ad hoc and informal nature of the medium.”  Regardless, the edited version of the tweet appeared in the ad.

Of interest here is the convergence of copyright, advertising and contract law.  Namely, Scott’s ownership of his tweet, the use of his tweet as an endorsement for a product and Twitter’s apparent prohibition against using tweets in ads without the user’s permission.  With respect to Twitter’s own rules, it states that one must get the user’s permission before, among other things, “creating an advertisement that implies the sponsorship or endorsement on behalf of the user.”

While it does not appear as though Scott will be taking any action other than registering his annoyance with the film promoter’s actions, the incident does serve as a reminder that, when using content found on social media, one must be careful to consider both the intellectual property rights of the creator as well as the terms and conditions of the social media site itself.

You can read A.O. Scott's piece on the episode here.

LinkedIn Brings John Doe Claim Against Scrapers

LinkedIn has filed a lawsuit in the U.S. District Court for the Northern District of California claiming that bots have been used to impermissibly scrape data from the profiles of hundreds of thousands of users. Thousands of fake accounts were created with the objective of using the bots to collect information from the profiles of legitimate accounts. While LinkedIn claims to have traced the accounts to an Amazon Web Services account, the identity of the actual culprits is still undetermined leading the social media site to identify the defendants as “The Doe Defendants.”

“Bots” refers to automated software applications that execute tasks over the Internet.  “Scraping” refers to the extraction of information from websites and is often restricted by a site’s terms of use, including LinkedIn’s.

Three important issues tied to the scraping include (i) the mere fact that the information was collected by parties who have not signed on to LinkedIn’s terms and conditions, (ii) determining how the scraped information will ultimately be used; and (iii) the impact on the integrity of LinkedIn’s profiles if many are found to be fake.  Moreover, in an InformationWeek article, LinkedIn’s concern with the degrading of its LinkedIn Recruiter services is noted.

LinkedIn is currently seeking the names of the owners of the fake accounts from Amazon. 

Important Social Media Guidance Issued for Financial Institutions

The Federal Financial Institutions Examination Council (FFIEC) issued final supervisory guidance that financial institutions are expected to use in "their efforts to ensure that their policies and procedures provide oversight and controls commensurate with the risks posed by their involvement with social media."

The FFIEC is the formal inter-agency body empowered to prescribe uniform principles, standards, and report forms for the federal examination of financial institutions by, among others, the Federal Reserve System, the Federal Deposit Insurance Company (FDIC) and the Consumer Financial Protection Bureau (CFPB).  The memorandum issued by the Council, "Social Media: Consumer Compliance Risk Management Guidance,"  is meant to "address the applicability of federal consumer protection and compliance laws, regulations, and policies to activities conducted via  social media by banks, savings associations, and credit unions, as well as nonbank entities supervised" by the CFPB.  Compliance officers with financial institutions as well as other senior managers at such institutions would be well served to review the Council's Guidance not only pursuant to their own responsibilities and obligations as outlined in the memorandum, but also because the memorandum provides a brief, yet substantive, overview of a wide variety of laws applicable to the financial sector's use of social media.  The Guidance makes reference to, and provides relevant summaries of, a variety of laws including, but not limited to, the Truth in Savings Act, the Equal Credit Opportunity Act, the Truth in Lending Act and the Fair Debt Collection Practice Act.

The Guidance  states that a "financial institution should have a risk management program that allows it to measure, monitor, and control the risks related to social media."  It also specifies that the risk management program should provide guidance and training for employee official use of social media.  The components of the risk management program include, in brief, the following:

• a governance structure with clear roles and responsibilities;
• policies and procedures regarding the use and monitoring of social media and compliance with all applicable  consumer protection laws and regulations, and incorporation of guidance as appropriate;
• a risk management process for selecting and managing third-party relationships in connection with social media;
• an employee training program;
• an oversight process for monitoring information posted to the financial institution's social media site;
• audit and compliance functions to ensure ongoing compliance; and
• parameters for providing appropriate reporting to the financial institution's directors and senior management  for periodic evaluation.

The Guidance points out that "Since this form of customer interaction tends to be both informal and dynamic, and may occur in a less secure environment, it can present some unique challenges to financial institutions."

Court Says Social Media Sites Off Limits to Sex Offenders

A New Jersey appellate court has upheld the state parole board’s restriction disallowing convicted sex offenders from accessing social media or other comparable web sites.

Superior Court Judge,  Jack Sabatino, writing for the three judge panel, said, “we are satisfied that the Internet restrictions adopted here by the Parole Board have been constitutionally tailored to attempt to strike a fair balance.”  Judge Sabatino continued, “We recognize that websites such as Facebook and LinkedIn have developed a variety of uses apart from interactive communications with third parties.  Even so, the Parole Board has reasonably attempted to draw the line of permitted access in a fair manner that balances the important public safety interests at stake with the offenders’ interests in free expression and association.”

The defendants, several convicted sexual offenders whose cases were consolidated, challenged the constitutionality of the restrictions as infringing their First Amendment rights of free speech and association, a violation of their Due Process rights and  corresponding rights under New Jersey’s Constitution.  The restrictions stem from Megan’s Law, which is a series of laws, originally passed in New Jersey, aimed at sex offenders.  One component of Megan’s law includes a requirement that those persons convicted between 1994 and 2004 of certain sexual offenses must serve, in addition to any existing sentence, a special sentence of  “community supervision for life,” and those convicted after that date range are sentenced to “parole supervision for life.”

The New Jersey Parole Board’s restriction does provide for parolees to seek special permission for gaining access to certain sites for work or another “reasonable purpose.”  The state’s Deputy Attorney General said, “It is not the Parole Board’s intention that these provisions bar appellants from having Internet access to news, entertainment, and commercial transactions.”

The New Jersey restriction is hardly novel as these cases have been sprouting up throughout the nation with varied outcomes.  You can read the full opinion here.