Spotlighting Intellectual Property Concerns and Mitigating Risks of

Social Media Networking Sites

Presented By:Theodore A. Wood, Director

Sterne, Kessler, Goldstein & FoxWashington DC

Prepared By:Schuyla Goodson Bell, Esq.Senior Legal AdvisorJohannesburg South Africa

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MYSPACETWITTERSFACEBOOKandLINKEDIN…

Understanding Social Media Networking sites

Corporate utilization of Social Media Networking sites • Spotlighting Online Presence

Legal Concerns for Companies

Guidance and Best Practices Discussion

Further Research and Reading

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SOCIAL MEDIA - is media designed to be disseminated through social interaction, created using highly accessible and scalable publishing techniques. Social media uses Internet and web-based technologies to transform broadcast media monologues (one to many) into social media dialogues (many to many). It supports the democratization of knowledge and information, transforming people from content consumers into content producers.

3 key components

• CONCEPT (art, information, or meme)

• MEDIA (physical, electronic, or verbal)

• SOCIAL INTERFACE (intimate direct, community engagement, social viral, electronic broadcast or syndication, or other physical media such as print)

Common forms

• CONCEPTS

• SLOGANS

• STATEMENTS with a high memory retention quotient, THAT EXCITE OTHERS TO REPEAT

• GRASS-ROOTS direct action information dissemination, public speaking, installations, performance and demonstrations

• ELECTRONIC MEDIA with sharing, syndication, or search algorithm technologies

• PRINT MEDIA, designed for re-distribution

Businesses also refer to social media as USER-GENERATED CONTENT (UGC) or CONSUMER-GENERATED MEDIA (CGM)

Source - Wikipedia

MYSPACETWITTERSFACEBOOKandLINKEDIN…

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TOP Social Networks

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myspace – 810,153,536 – No.2

twitter – 54,218,731 – No. 3

facebook – 1,191,373,339 – No. 1

linkedin – 42,744,438 – No. 5

monthly visits and unique visitors – January 2009 – Source: compete.com

myspace – 58,555,800

twitter – 5,979,052

facebook – 68,557,534

linkedin – 42,744,438

Q4 2009 UPDATE Source: Nielsen Online

MySpace.com tops US social-networking sites with an estimated 57.4 million unique visitors in November 2009, down from October’s 58.8 million

Google’s Blogger maintains top ranking with 33.6 million visitors, down from October’s 34.1 million

Facebook increased the number of visitors to an estimated 22.0 million, up from October’s 19.5 million – representing an increase of 89% vs. Nov. 2006; MySpace visitors have only increased approximately 7%each year

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For Review

12 of the world’s largest brands and companies have immediately committed to using Facebook Ads … facebook press release, 5 November 2007

WHY ???????MYSPACETWITTERSFACEBOOKandLINKEDIN…

Interactive Marketing Platform

Real-time Interaction – fast and brutally honest

Increase sales – reach new and far away destinations – recruit new consumers and retain existing relationships

Enhance consumer confidence – quickly address concerns – minimize negative impact and maximize GOOD NEWS!!

Drive and direct consumer traffic

• utilizes Twitter to identify service opportunities and initiate responses

• to amplify praise and reinforce service reputation

• all employees have accounts

• 65+ corporate accounts

• More than 400K followers

• Promotions and discounts offered

• $US3M in sales via Twitter

• who owns the intellectual property designed by consumers on creativity driven websites???

Source – Jeffbullas.com

Twitter presence – spring 2007

Approximately 1.6+ million Twitter followers

Utilized to address customer concerns related to travel problems

Corporate Communications manages company and consumer interaction and engagement Given character limitations some responses may need to utilize alternative mediums to communicate company messages and MITIGATE LEGAL RISK

• NO MORE $$$$ Super Bowl Advertisements????

• the brand twitters at - @ pepsi while the corporation twitters at - @pepsico

• continuous dialog about brands, products and promotions

• responds ONLY ONCE to negative comments

• monitors and tracks consumer sentiments

Source – Jeffbullas.com

Deloitte Ethics & Workplace Survey 2009 – 74% of employed Americans surveyed believe it is easy to damage a brand’s reputation via Facebook, Twitter & YouTube – Source; socialware.com/knowledge/industry _statistics

ANTI-TRUST concerns? I discovered it on Facebook

LITIGATION – did I say that on Facebook or Twitter

Existing trademark laws may not be sufficient – filing suit in court may be the appropriate option

GUIDANCE AND BEST PRACTICES DISCUSSION Consider what you need to protect and then reserve key brand names to

minimize unauthorized third parties from utilizing company intellectual property Link to sites from official company web sites and link to the company’s official site Collaborate with public relations, IT or corporate communications departments to

develop monitoring protocols and posting processes Encourage users to report defamatory or abusive postings – Make It Easy!! Communicate protocols and processes to internal and external clients – consider

implementing internal interactive training and awareness programs for business clients and specific service providers

Put it in writing - use company intranets and employee manuals to provide specific guidance on employee use of social networks and blogs relating to company information including contravention of company intellectual property assets and unauthorized utilization of third party IP assets

• Counsel employees not to make libelous or disparaging statements on any web sites – give consideration to First Amendment rights and ensure that all policies are updated in employee manuals

• Personal or professional use of social networking sites can have monumental consequences for a company or individual

• Advise against the disclosure of confidential information, libel and the disparagement of your company on these Web sites

GUIDANCE AND BEST PRACTICES DISCUSSION Clearly understand the terms of use and the process under the Digital Millennium

Copyright Act (DMCA) for removing infringing content from web sites• NOTE: The DCMA’s Safe Harbor Provision was designed to give online

service providers some level of protection from liability resulting from the presence of/uploading of infringing materials to their sites as long as the following criteria has been met:

– the service provider doesn’t have actual knowledge that the material, or an activity utilizing the material on the relevant network is infringing the rights of a third party

– in the absence of such actual knowledge, the service provider is not aware of facts or circumstances from which the infringing activity is apparent; or

– upon obtaining such knowledge or awareness, the service provider acts expeditiously to remove, or disable access to, the infringing material

Review and understand the trademark policies of each social networking web site. Most major social networking sites allow trademark owners to report trademark violations online

• Create a plan of action that weighs legal risks and public relations implications • If you identify a concern, report it immediately utilizing the appropriate

processes for your company and the relevant web site• Always be prepared to respond correctly to unauthorized and defamatory use

of company brands, trade names, trade secrets, advertisements or other intellectual property

FURTHER RESEARCH AND READING Keep abreast of new legislation and updates to existing regulations

• Federal Trade Commission’s Guides Concerning the Use of Endorsements and Testimonials in Advertising

– www.ftc.gov/bcp/index.shtml• Digital Millennium Copyright Act

– www.copyright.gov/legislation/dmca.pdf• Children’s Online Privacy Protection Act

– www.ftc.gov/privacy/privacyinitiatives/childrens.html• Telecommunications Privacy Act• CAN- SPAM Act

– www.ftc.gov/bcp/edu/pubs/business/ecommerce/bus6.1shtm

Identify and monitor developing case law when advising clients and developing new protocols