Trade Secrets and Social Media

Trade Secrets and Social Media

More and more often, employees are required to engage in sponsored social media networks such as Twitter, Facebook, MySpace, LinkedIn, and others, during the course of their work. This participation may be as simple as maintaining a professional online profile for networking purposes, or as complex as the development of a company brand via simultaneous blogging, tweeting, and podcasting. Many companies even dedicate one or more employees to full time management of their social media presence and consequently derive substantial economic benefit from said presence. In recognition of this, the United States District Court for the District of Colorado recently ruled that a company’s social media profile, including their “Friends” list, may be protected as trade secrets (Renee M. Jackson, Nixon and Peabody LLP).

The specific case on which the ruling was made concerned a nightclub promoter who retained access to the MySpace account through which he managed promotions as the Director of Entertainment, a Mr. Roulier. After he left employment as the Director of Entertainment and opened his own nightclub, Mr. Roulier took advantage of the extensive list of contacts – over 17,000 friends – to make booking for DJs and advance the brand of his new venue. While the names of these friends were not important, other data associated with their name were. Because the information Mr. Roulier used for promotions could not be publicly accessed, and because the time and effort spent building the list was at the cost of his former employer, the list was deemed worthy of protection as a trade secret.

According to Wikipedia, “A trade secret is a formula, practice, process, design, instrument, pattern, or compilation of information which is not generally known or reasonably ascertainable, by which a business can obtain an economic advantage over competitors or customers.” More broadly, a trade secret is typically something that is owned by the company in question, and is considered part of their intellectual property. On the surface, this runs counter to how we typically think about friend lists and social media.

A social media profile is, by its very nature, a somewhat public data set. Even if profile access is limited by a password and viewing privileges are restricted to certain individuals, the website that the profile is on still retains access to all of the data that you choose to give it. You may feel like you have both privacy and ownership of your profile, but that is merely an impression. Mark Zuckerberg’s infamous comment that this illusion is created specifically to get you to share more information – which can then be used for a variety of purposes, not all of them innocuous – is particularly illustrative of this. But in any case, the ways in which we create and discuss social media profiles run counter to how we create and discuss trade secrets. A similar analysis can be made of friend lists.

However, what the United States District Court for the District of Colorado seems to be getting at in their ruling in the case of Mr. Roulier is that the relationships created using social media are what should be protected as trade secrets. Whether or not the contact information is truly private is a question that will eventually be left by the wayside, at least if current trends continue. Therefore, it is the business relationships that come with a social media profile and associated friend list that need to be protected, because these are at the heart of what creates economic gain for the company, and what they go to great lengths to establish and maintain.

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  • on at 2:02 pm Reply

    It’s an awesome post for all the internet
    people; they will get advantage from it I am sure.

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