Social Media Technologies Raise New Liability Concerns

Social Media Technologies Raise New Liability Concerns

The advent of social media—whether it is popular platforms like Facebook and Twitter, or blogs, or interactive websites—has revolutionized the way we communicate in recent years. However, as with any revolutionary technology, along with the advantages it brings, it also brings a number of new legal challenges that need to be addressed by companies and individuals that use it.

Lincoln Bandlow, an attorney with Lathrop & Gage, discussed the new legal issues brought to the forefront by the popularity of these technologies.

“This really isn’t all that different. It’s just another way of communicating messages—a more democratic one, a more pervasive one—but certainly just another way of communicating messages. And when you communicate messages you’re subjected to a variety of different liabilities,” said Bandlow.

“So when you’ve got blogs, you’ve got Facebook, you’ve got any kind of site where people are talking about each other and saying things about each other, you’ve got a potential for defamation liability there,” he said.

He also said that this public discussion raises potential liability for invasion of privacy and he expects to see a “lot of litigation” involving cases where someone reveals information about someone else which—while truthful—could be deemed private and highly offensive to a reasonable person if disclosed.

Infringement

Bandlow said such sites also raise the potential for misappropriation or “right of publicity” type cases due to that fact that it’s so easy to use others’ images or likenesses on social media sites. “In a right of publicity type claim there’s no sort of state of mind requirement,” said Bandlow. “If you use somebody else’s image without their permission, to your advantage, you can have a problem with these kind of claims.”

Copyright infringement is a concern, he said. “It’s easy to post this stuff and that’s a copyright infringement. Barring some kind of fair use defense or license, that’s a copyright infringement. Copyright infringement is a strict liability scheme, so you don’t get to say, ‘I didn’t think it was copyrighted, I didn’t know, I didn’t mean to’—nobody cares. If you use somebody else’s work without permission that’s an infringement,” said Bandlow.

Professional Liability

Robert Wice, Underwriter, Specialty Lines/Technology, Media and Business Services with Beazley Group, said that a lot of the social media liability he has seen has been “professional liability type exposure through video sharing, file sharing and certainly privacy aspects related to web apps.”

“And it is a tough risk to look at because it is so nascent. It’s certainly not a mature area of the law,” said Wice.

“This is a very difficult area to really understand what the defense costs could be,” he continued. “You’ve got intellectual property issues and other media claims which in general can be very, very costly” to defend.

‘Fundamental Misunderstanding’

Jennifer Smith, Vice President & Senior Client Advisor with Lockton Companies, said she has witnessed a “fundamental misunderstanding” of how social media is used and stored.

“People say stupid things. We’re our own worst enemy,” Smith observed.

She said she has seen claims stemming from statements made by executives of technological or entrepreneurial companies that were alleged to have caused “tortious interference or some kind of reputational harm to competitors.” To reduce such risks Smith said her company tries to get clients to adopt and apply a set of best practices in the use of social media, Smith said.

Bandlow, Wice and Smith shared their insights during the NetDiligence® Cyber Risk & Privacy Liability Forum, on June 9, 2011, in Philadelphia. The program was co-produced by NetDiligence and HB Litigation Conferences.