New Ruling Sounds Warning For Business Social Media Passwords


New Ruling Sounds Warning For Business Social Media Passwords

The way businesses handle their social media accounts is likely to change dramatically following a recent Houston bankruptcy court battle.

Jeremy Alcede spent almost seven weeks in prison for refusing a federal judge's order to give the new owner of his Houston gun store which he had lost through bankruptcy, the passwords to the business' Twitter and Facebook accounts, after the judge had determined they were property of the business.

Alcede gave up the the passwords after his release, but was defiant, claiming the judge's order had contravened his rights.

"It's all about silencing my voice ... Any 3-year-old can look at this and tell this is my Facebook account and not the company's."

U.S. Bankruptcy Judge Jeff Bom who presided over Alcede's case said "the landscape of social media is yet mostly uncharted in bankruptcy," pointing to a New York bankruptcy court case in 2011 which ruled social media accounts were similar to business subscriber lists, which "provide valuable access to customers and potential customers."

Legal experts say the Alcede's cases takes both bankruptcy proceedings and social media law into uncharted waters. They say it also acts as a warning to both business owners and employees about their use of social media, which based on the Houston case, can now be seen as business assets.

Benjamin Stewart a bankruptcy lawyer in Dallas said "If your business is something you feel very passionately about, it can be hard to separate those things. The moral for people is you have to keep your personal life separate from your business”.

Previous court cases in various parts of the US and in Great Britain add to the uncertainty of business social media law and who owns them.

A South Carolina court in 2012 threw out a case in which an Internet company sued a former worker for taking with him 17,000 twitter followers when he left the company . The company had claimed thousand of dollars in lost revenue.

In 2013 a federal court in Pennsylvania ruled in favor of a woman who had sued her former employer after they had taken over her LinkedIn account following her firing.

Also in 2013 a British court allowed a company to temporarily stop ex-employees from using its LinkedIn contacts when starting a new business. The employees had claimed the accounts and the account contacts were personal.

Michael Risch a law professor at Villanova who specializes in Internet law, said social media platforms including Twitter and Facebook were seen as company property.

Risch said in the Alcede case "I suspect that's what the judge was looking at, is this primarily an asset being used for business advertising to get customers to talk about what is going on with the company, It might have started out as a personal (account) but turned into a business property".

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