Instagram now allows celebrities to block trolls.

While Facebook reached new highs last quarter, Twitter continued to stumble. Will adding more live video content or allowing users to create Snapchat-like collage custom emojis over photos help Twitter regain its footing?

Tips for fixing your company’s social media marketing strategy.

A pop singer told fans to send him their Twitter passwords so he could post personal messages to their feeds. Marketing genius or potential Consumer Fraud and Abuse Act violation?

Tiffany & Co. launched a Snapchat filter to attract millennials.

Yelp posted a warning on the Yelp.com page of a Manhattan dentist who filed defamation suits against five patients over four years for giving him negative reviews.

Sponsored content is becoming king in a Facebook world.

The New York Times built an in-house analytics dashboard to make it easy for its reporters to access reader engagement data.

Pinterest appears to be losing to Snapchat in the battle for digital ad dollars.

Profile pranks or endorsement bombing on LinkedIn is an actual thing.

CaptureThe latest issue of our Socially Aware newsletter is now available here.

In this issue of Socially Aware, our Burton Award winning guide to the law and business of social media, we take a look at courts’ efforts to evaluate emoticons and emojis entered into evidence; we describe the novel way one court addressed whether counsel may conduct Internet research on jurors; we examine a recent decision finding that an employee handbook provision requiring employees to maintain a positive work environment violates the National Labor Relations Act; we discuss an FTC settlement highlighting legal risks in using social media “influencers” to promote products and services; we explore the threat ad blockers pose to the online publishing industry; we review a decision holding that counsel may face discipline for accessing opposing parties’ private social media accounts; we discuss a federal court opinion holding that the online posting of copyrighted material alone is insufficient to support personal jurisdiction under New York’s long-arm statute; and we summarize regulatory guidance applicable to social media competitions in the UK.

All this—plus an infographic illustrating the growing popularity of emoticons and emojis.

Read our newsletter.

Social media has upended a number of industries. Is Wall Street next?

Facebook is getting into the video game live-streaming business.

Steven Avery’s defense attorney is keeping her 163,000 Twitter followers abreast of her ongoing defense work on behalf of the “Making a Murderer” documentary subject, and some lawyers think it’s a bad idea.

Five quick and easy ways to double your social media following.

Fake Internet traffic schemes will become the second-largest market for criminal organizations behind cocaine and opiate trafficking.

Bots and fraudsters are feasting on political ad dollars.

People are spending less time on social media apps these days? With Snapchat on pace to have more than 58 million active users this year, we’re skeptical.

The man who created the Internet wants to create a less centralized web with more privacy and less government and corporate control.

Should Twitter limit the number of tweets users can send each day? Other platforms see the value in limiting posts.

In the UK the number of arrests over offensive social media posts is soaring.

Research shows an alarming number of people in the UK can’t distinguish between marketing and non-commercial content on social media, indicating potential breaches of the CAP Code (the UK’s version of the FTC’s Endorsement Guides). Here’s how social media marketers in the UK can stay on the right side of the law.

Google co-founder Larry Page is secretly building flying cars.

Our attention spans are decreasing. Here’s how that should affect your brand’s website and social media strategy.

In a massive recent theft of Twitter usernames and passwords, “123456” was the most commonly used passcode by far. Sigh.

 

In a fascinating, must-read article, a Google design ethicist explains the techniques that engineers and entrepreneurs employ to keep us hooked on the web.

A majority of U.S. adults—62%—now get their news on social media.

An apartment complex in Utah is trying to force its residents to “friend” the complex.

Will the next head of state take over the vast online infrastructure that the Obama administration created as the first administration to digitally engage with its constituency?

Get ready for 74 new emojis.

Tired of being reminded about potentially painful past social media posts? Here’s how to turn off Facebook’s “On This Day” notifications.

Texas inmates are now barred from using social media.

Participating in online social networks in Russia has become risky business.

To comply with a new code of conduct in the European Union, the biggest social media platforms have agreed to remove hate speech within 24 hours.

Are websites a dying business?

Instagram’s mobile app has a new dashboard that allows small businesses to measure the reach of their posts.

Periscope users can now moderate comments during their broadcasts.

Stop telling people there’s a dot in your Gmail address—it doesn’t matter.

Hootsuite CEO Ryan Holmes says it’s important to hop on the Snapchat bandwagon, no matter how old you are. Here’s why.

iStock_000034905072_MediumSocial media has allowed aspiring authors, musicians, filmmakers and other artists to publish their works and develop a fan base without having to wait to be discovered by a publishing house, record label or talent agency. And that seems to have made at least modest celebrity easier to achieve. The financial rewards that we usually equate with fame, however, might be just as elusive as they were in the pre-Internet age—perhaps even more so, in an era where content, once posted online, can be exploited by others in ways that typically don’t generate money for the creator of the content.

Sure, some hard-working social media stars are scoring big profits based on their popularity. The YouTube channel CharlisCraftyKitchen, for example, which features videos of a young girl making treats and which boasts 29 million views a month, averages monthly ad revenue close to $130,000.

The Swedish gamer PewDiePie’s net worth is estimated at $61 million—a big sum for a guy who is unknown to most people over 40 years old.

And, having secured a book deal and endorsement contracts with brands like L’Oreal, self-taught makeup artist/vlogger Michelle Phan is now at the center of a true life rags to riches story.

I suspect, however, that a far more common tale is the one told by Gaby Dunn, co-star of the YouTube comedy sketch channel Just Between Us, in a fascinating article entitled “Get Rich or Die Vlogging: The Sad Economics of Internet Fame.”

Dunn reports that, despite her channel’s “more than half a million subscribers” and “hungry fan base,” she’s broke and has to take menial jobs to make ends meet.

Dunn says that she and her vlogging partner, Allison Raskin, make money from the “ads that play before [their] videos,” and by freelance writing and performing, “but it’s not enough to live, and its influx is unpredictable.”

Almost as frustrating as brands not believing that Dunn’s channel is big enough to sponsor are her fans’ reactions when she does score a patron. Dunn’s and Raskin’s third branded video in more than two years resulted in viewer comments such as “Enough with the product placement” and “Gotta get that YouTube money, I guess.” And, as we’ve discussed in past blog posts, if a vlogger or other content producer is being paid to endorse a product or service, he or she is generally required to disclose this material connection to his or her followers.

In any event, Dunn is hardly the only online content creator feeling the pinch. Even writers who’ve enjoyed full-time positions at large journalism outlets are finding themselves out of a regular paycheck. The popular digital media website Mashable, for example, laid off 30 members of its staff—including several high-level editors. The current affairs website Salon recently cut back on the number of people on its payroll, too—20 percent of the publication’s editorial staff lost their jobs in April.

Things are equally discouraging in the music business; one revealing statistic from the RIAA is that, in 2015, record companies received more money from vinyl record sales than from ad-supported online streaming.

A real challenge for social media celebrities and other content creators is that online ad rates have been declining for years; despite the continued growth of online advertising, there are not enough ads to support the ever-expanding pool of Web content seeking advertiser support.

Another threat is the rise of freebooting—that is, the practice where a video specifically created for and posted to YouTube is, without the authorization of the video’s creator, copied and uploaded to Facebook, where it may generated millions of views without compensation to the creator.

And perhaps the greatest concern for content creators is the increasing popularity of ad-blocking technologies. The use of ad blockers has grown by 41 percent over the past 12 months; there are now nearly 200 million active users of such technologies worldwide. In the United States, an estimated 45 million Americans are surfing an ad-free version of the Internet, resulting in an estimated $22 billion in lost ad revenues in 2015.

All of this adds up to form a rather bleak picture for content creators seeking to make a living online; a million social media followers may result in fame, but not fortune. And fame without fortune doesn’t pay the bills.

 

*    *    *

For more information on potential legal hurdles for social media celebrities, influencers, bloggers, vloggers and other content creators seeking to make a living online, please see these related Socially Aware blog posts:

Innovative Social Media Marketing Cannot Overlook Old-Fashioned Compliance

FTC Continues Enforcing Ad Disclosure Obligations in New Media and Issues a Warning to Advertisers

FTC Enforcement Action Confirms That Ad Disclosure Obligations Extend to Endorsements Made in Social Media\

Influencer Marketing: Tips for a Successful (and Legal) Advertising Campaign

An FTC Warning on Native Advertising

Facebook users spend more time on the platform than they spend pursuing any other leisure activity, except TV. Indeed, 1/16th of the average user’s waking time is spent on the platform.

The most disliked movie trailer in history, according to YouTube.

New California law would determine what happens to your Facebook and email when you die. This article explains what’s likely to happen to your social media assets if you die anywhere else.

Guess what percentage of U.S. households own a wearable?

According to the messaging platform’s own CEO, Snapchat is not social media.

Twitter filed a lawsuit arguing it should be allowed to publicly disclose more details about requests for information from the government.

Fail! Another NYPD social media campaign gone bad makes headlines.

How your social media profiles make you vulnerable to identity theft, and what you can do about it.

Tips for using social media to plan your vacations and land a job.

04_21_Apr_SociallyAware_v6_Page_01The latest issue of our Socially Aware newsletter is now available here.

In this issue of Socially Aware, our Burton Award winning guide to the law and business of social media. In this edition, we discuss what a company can do to help protect the likes, followers, views, tweets and shares that constitute its social media “currency”; we review a federal district court opinion refusing to enforce an arbitration clause included in online terms and conditions referenced in a “wet signature” contract; we highlight the potential legal risks associated with terminating an employee for complaining about her salary on social media; we explore the need for standardization and interoperability in the Internet of Things world; we examine the proposed EU-U.S. Privacy Shield’s attempt to satisfy consumers’ privacy concerns, the European Court of Justice’s legal requirements, and companies’ practical considerations; and we take a look at the European Commission’s efforts to harmonize the digital sale of goods and content throughout Europe.

All this—plus an infographic illustrating the growing popularity and implications of ad blocking software.

Read our newsletter.

0329_JS_imageThe European Commission has published two draft directives on the supply of digital content and the online sale of goods that aim to help harmonise consumer law across Europe. In proposing these new laws, the European Union is making progress towards one of the main goals in its Digital Single Market Strategy (announced in May 2015), which is concerned with strengthening the European digital economy and increasing consumer confidence in online trading across EU Member States. According to the Commission, only 12% of EU retailers sell online to consumers in other EU countries, while more than three times as many sell online in their own country. The Commission has also announced a plan to carry out a fitness check of other existing European consumer protection laws.

This article outlines the potential implications of these latest developments, with a particular focus on the UK and Germany.

DIGITAL CONTENT AND ONLINE SALES OF GOODS

This is not the first time that the Commission has tried to align consumer laws across the EU: the Commission’s last attempt at a Common European Sales Law faltered in 2015. But the Commission has now proposed two new directives dealing with contracts for the supply of digital content (“Draft Digital Content Directive”) and sales of online goods (“Draft Online Goods Directive”) (together, the “Proposed Directives”). The Online Goods Directive will replace certain aspects of an Existing Sales of Consumer Goods and Associated Guarantees Directive (“Existing Goods Directive”), whereas the Digital Cotent Directive introduces a new set of rights for consumers when they buy digital content across the EU.

Part of the issue with previous EU legislative initiatives in this area is that “harmonised” has really meant “the same as long as a country doesn’t want to do anything different”. This time, the Proposed Directives have been drafted as so-called “maximum harmonisation measures”, which would preclude Member States from providing any greater or lesser protection for the matters falling within their scope. The Commission hopes that this consistent approach across Member States will encourage consumers to enter into transactions across EU borders, while also allowing suppliers to simplify their legal documentation by using a single set of terms and conditions for all customers within the EU.

The Proposed Directives will need to be adopted by the EU Parliament and Council before becoming law. Member States would then have two years to transpose the Proposed Directives into national law.

Continue Reading Digital Single Market Strategy Update: Europe Proposes Further Harmonisation of Consumer Protection Laws

03_21_Signs_Today’s companies compete not only for dollars but also for likes, followers, views, tweets, comments and shares. “Social currency,” as some researchers call it, is becoming increasingly important and companies are investing heavily in building their social media fan bases. In some cases, this commitment of time, money and resources has resulted in staggering success. Coca-Cola, for example, has amassed over 96 million likes on its Facebook page and LEGO’s YouTube videos have been played over 2 billion times.

With such impressive statistics, there is no question that a company’s social media presence and the associated pages and profiles can be highly valuable business assets, providing an important means for disseminating content and connecting with customers. But how much control does a company really have over these social media assets? What recourse would be available if a social media platform decided to delete a company’s page or migrate its fans to another page?

The answer may be not very much. Over the past few years, courts have repeatedly found in favor of social media platforms in a number of cases challenging the platforms’ ability to delete or suspend accounts and to remove or relocate user content.

Legal Show-Downs on Social Media Take-Downs

In a recent California case, Lewis v. YouTube, LLC, the plaintiff Jan Lewis’s account was removed by YouTube due to allegations that she artificially inflated view counts in violation of YouTube’s Terms of Service. YouTube eventually restored Lewis’s account and videos but not the view counts or comments that her videos had generated prior to the account’s suspension.

Lewis sued YouTube for breach of contract, alleging that YouTube had deprived her of her reasonable expectations under the Terms of Service that her channel would be maintained and would continue to reflect the same number of views and comments. She sought damages as well as specific performance to compel YouTube to restore her account to its original condition.

The court first held that Lewis could not show damages due to the fact that the YouTube Terms of Service contained a limitation of liability provision that disclaimed liability for any omissions relating to content. The court also held that Lewis was not entitled to specific performance because there was nothing in the Terms of Service that required YouTube to maintain particular content or to display view counts or comments. Accordingly, the court affirmed dismissal of Lewis’s complaint.

In a similar case, Darnaa LLC v. Google, Inc., Darnaa, a singer, posted a music video on YouTube. Again, due to allegations of view count inflation, YouTube removed and relocated the video to a different URL, disclosing on the original page that the video had been removed for violating its Terms of Service. Darnaa sued for breach of the covenant of good faith and fair dealing, interference with prospective economic advantage and defamation. In an email submitted with the complaint, Darnaa’s agent explained that she had launched several large campaigns (each costing $250,000 to $300,000) to promote the video and that the original link was already embedded in thousands of websites and blogs. Darnaa sought damages as well as an injunction to prevent YouTube from removing the video or changing its URL.

The court dismissed all of Darnaa’s claims because YouTube’s Terms of Service require lawsuits to be filed within one year and Darnaa had filed her case too late. In its discussion, however, the court made several interesting points. In considering whether YouTube’s Terms of Service were unconscionable, the court held that, although the terms are by nature a “contract of adhesion,” the level of procedural unconscionability was slight, since the plaintiff could have publicized her videos on a different website. Further, in ruling that the terms were not substantively unconscionable, the court pointed out that “[b]ecause YouTube offers its hosting services free of charge, it is reasonable for YouTube to retain broad discretion over [its] services.”

Although the court ultimately dismissed Darnaa’s claims based on the failure to timely file the suit, the decision was not a complete victory for YouTube. The court granted leave to amend to give Darnaa the opportunity to plead facts showing that she was entitled to equitable tolling of the contractual limitations period. Therefore, the court went on to consider whether Darnaa’s allegations were sufficient to state a claim. Among other things, the court held that YouTube’s Terms of Service were ambiguous regarding the platform’s rights to remove and relocate user videos in its sole discretion. Thus, the court further held that if Darnaa were able to amend the complaint to avoid the consequences of the failure to timely file, then the complaint would be sufficient to state a claim for breach of the contractual covenant of good faith and fair dealing.

Continue Reading How to Protect Your Company’s Social Media Currency

0114_SA_ImageIn this election season, we hear a lot of complaints about laws stifling business innovation. And there is no doubt that some laws have this effect.

But what about laws that spur innovation, that result in the creation of revolutionary new business models?

Section 512(c) of the Digital Millennium Copyright Act (the DMCA) is one such law. Passed by Congress and signed by President Bill Clinton in 1998, Section 512(c) has played an enormous role in the success of YouTube, Facebook and other social media platforms that host user-generated content, by shielding such platforms from monetary damages from copyright infringement claims in connection with such content.

Absent this safe harbor, it is difficult to imagine a company like YouTube thriving as a business. For example, in 2014 alone, YouTube removed over 180 million videos from its platform due to “policy violations,” the vast majority of which likely stemmed from alleged copyright infringement; yet, absent the Section 512(c) safe harbor, YouTube could have been exposed to staggering monetary damages in connection with those videos.

The DMCA’s protection from liability is expansive, but it is not automatic. To qualify, online service providers must affirmatively comply with a number of requirements imposed by the law. While most of those requirements may seem straightforward, a recent case in the Southern District of New York illustrates how even seemingly routine paperwork can pose problems for websites that host user-generated content.

For companies seeking protection under the DMCA, the typical starting point is designating an agent to receive “takedown” notices from copyright owners. If a company is sued for copyright infringement relating to its website, that company will want to show that it has designated a DMCA agent. But what if the designation paperwork was handled by another entity within the defendant’s organizational structure, such as a corporate parent? That was the situation faced by one of the defendants in BWP Media USA Inc., et al. v. Hollywood Fan Sites LLC, et al. (S.D.N.Y. 2015)—and the court held that the defendant was out of luck.

Although the defendant’s corporate parent had filed a registration form with the U.S. Copyright Office under the parent’s name, nothing on the form mentioned the defendant or made any general reference to affiliates. Under those circumstances, the court concluded that the defendant was ineligible for the safe harbor because it had “no presence at all” in the Copyright Office’s directory of DMCA agents. The court reasoned that those searching the Copyright Office directory should not be “expected to have independent knowledge of the corporate structure of a particular service provider.”

Despite lacking a Copyright Office registration, the defendant argued that it did actually post the agent’s information on its own website, and that one of the plaintiffs had successfully used such information to send a takedown notice resulting in removal of the allegedly infringing material. The court found those assertions “irrelevant,” because they did nothing to address the Copyright Office registration requirement. As the court noted, the DMCA requires each service provider to post the agent’s name and contact information on the provider’s website, and submit such information to the Copyright Office.

Would the defendant’s DMCA eligibility have turned out differently if the parent had included the affiliate’s name on the form, or at least made a general reference to the existence of affiliates? The court’s opinion leaves those questions unaddressed, but the preamble to the Copyright Office regulations—cited in passing by the court—appears to reject such an approach. According to the preamble, each designation “may be filed only on behalf of a single service provider[, and] related companies (e.g., parents and subsidiaries) are considered separate service providers who would file separate [designations].”

Following the Hollywood Fan Sites decision, we expect that many companies that host user-generated content will be checking to make sure that all of their legal names are indeed listed in the Copyright Office directory—and, in light of the Copyright Office’s position on this subject, many such companies may also decide to file separate designations for each legal entity within a corporate family. While this process may be cumbersome, it seems a small price to pay for the generous safe harbor benefits offered by the DMCA, especially for companies with business models that depend on user-generated content.