SOCIAL MEDIA AND TRADE SECRETS - Losing trade secret protection in the social media void

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Social media interactions are second nature to many employees today. For this reason social media poses great risks to maintaining the secrecy of valuable information, unless managed properly. Here are some steps that employers need to consider:

Defining Limits: I remember being told years ago that you don’t discuss confidential information in an elevator because you never know who is standing next to you. At that time, this was quite a revelation to me. Today, social media is like the biggest elevator in the world. While most employers have employees sign non-disclosure agreements, employers must also implement employee policies (and periodically reinforce these policies) that emphasize that confidential information is not to be disclosed over social media – even to what one assumes is a small group of friends.

Ownership of Contacts: If LinkedIn (or a similar network) is used for business, then an employee’s contacts (which would often be the employer’s confidential information) should be set to “private” so as not to be viewable by other network members. Additionally, policies should be in place that specify that social network contacts used for business purposes is the confidential information of the employer and must be deleted or otherwise managed upon termination of employment in accordance with employer instructions.

Owning the Account: The law is unclear as to the ownership of employee’s social media accounts and the data contained in those accounts. For this reason it is important to establish in employee handbooks and policies that the employer is the owner of the social network accounts including all data contained in the accounts. While most social network terms of use don’t allow transferring accounts – employees can nevertheless be required to turn over user names and passwords and the data can still be transferred out.

Bottom Line: Ownership and control over employee social network accounts in an unsettled area of law. Nevertheless, employers can implement policies described above to put themselves in the best position to be able to retain and benefit from those accounts. However, when exercising control over such accounts, employers must be careful not to violate an employee’s rights under state or federal law (e.g., the National Labor Relations Act).

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William Galkin manages GalkinLaw. Mr. Galkin has dedicated his legal practice to representing Internet, e-commerce, computer technology and new media businesses across the U.S. and around the world. He serves as a trusted adviser to both startup and multinational corporations on their core commercial transactions.

  
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