Court Rules That LinkedIn Account Belongs to Employee, not Employer

Eagle v. Edcomm, a case about which I’ve posted before, resulted in what may be one of the first rulings on the merits of a thorny issue concerning social media:  Who owns a social media account, the employer or the employee, if there is no written corporate policy on point?  Judge Buckwalter in the Eastern District of Pennsylvania held that Linda Eagle’s LinkedIn account belonged to Eagle, who was the founder and President of Edcomm before she had a falling out with the company’s new management.

The facts about what happened to Eagle’s LinkedIn account were largely undisputed.  After firing Eagle, the company accessed her account, changed its password, and locked her out of her account.  Even after she regained her account, Eagle was unable to access emails sent to the account for a period of a few months.   While Edcomm had control of the account, users attempting to view Eagle’s profile would see the name, picture, and credentials of Edcomm’s new President, Sandi Morgan.

Eagle filed suit, bringing both federal and statutory and common law clams; Edcomm filed counterclaims.  In prior rulings, Judge Buckwalter dismissed some of Edcomm’s counterclaims and Eagle’s federal claims.  Now representing herself pro se, Eagle took her remaining claims against Edcomm to trial.

For the purposes of social media law, one of the Court’s most significant rulings was the dismissal of Edcomm’s counterclaim for misappropriation.  Edcomm contended that the account belonged to it, arguing that it had invested time and effort into its employees’ LinkedIn accounts.  The Court disagreed, finding that Edcomm did not require its employees to set up accounts, nor did they dictate their precise contents.  Furthermore, the Court noted that the LinkedIn User Agreement expressly states that the contract is between a LinkedIn user (here, Eagle) and LinkedIn.   One wonders whether a corporate policy that stated that the account belongs to an employer would have trumped the user agreement.

Unfortunately for Eagle — whose husband died during the prosecution of this case after a long and difficult illness, further complicating her efforts to prosecute her case – the Court did not award her damages even though she had proved the necessary legal elements of most of her claims.  Nor did the Court award her attorney’s fees (she was represented by counsel in earlier phases of the case*) under her claim for violation of Pennsylvania’s statute that prohibits the unauthorized use of her name, 42 Pa. Cons. Stat. § 8316.  Eagle had not submitted evidence of the bills at trial and the Court did not accept the summary evidence of legal fees she provided post-trial.  (While the Court had previously dismissed Eagle’s federal claims, such as a claim under the Computer Fraud and Abuse Act, it is worth noting that several state and federal statutes implicated in social media disputes allow parties to recover their attorney’s fees).

Eagle made an earnest effort to prove damages by someone who was unable to afford an expensive expert.  She introduced the lay testimony of her business partner, Clifford Brody.  Brody testified that 70% of Eagle’s sales were to existing clients, who were among her 4,000 LinkedIn contacts.  He then computed 70% of Eagle’s historical average sales during the length of time she could not receive communications from her contacts, 3 months, to calculate her losses.  This is not an implausible theory, but it was one that Eagle elicited through Brody without laying enough of a foundation through documentation, reports, and figures to satisfy the Court.   Likewise, the Court noted that Eagle had generated great sales success in the past without LinkedIn; therefore, it had trouble accepting the proposition that LinkedIn was essential to historical sales.  However, I suspect that such evidence was in the record,  as much of LinkedIn’s customers were employees at overseas financial institutions who were early and heavy adopters of LinkedIn.

For Eagle and Edcomm, the battle is not yet over because other litigation is ongoing in the Southern District of New York, where both parties have claims and counterclaims arising from the takeover of Edcomm.  Recently, Edcomm’s lawyer asked to be relieved from that case, stating that his firm had not been paid by Edcomm in some time.  Meanwhile, Eagle and her former partners are continuing to build their new business, Global Bankers Institute.

In conclusion, one lesson of this case may be that courts are resistant to efforts to value each LinkedIn connection or Twitter follower in social media disputes.   But another crucial lesson – one that has been emphasized by scores of bloggers and legal experts – is that even small to mid-sized companies need to consider and address the risks they face concerning social media through policies and procedures.

* Disclosure: I represented Eagle in an earlier phase of this case.

 

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