United States: Legal And Business Concerns Of The Newly Minted Social Media Star

Last Updated: September 24 2014
Article by David O. Klein

Over the past few years, a new type of celebrity has emerged: the social media star.  These are individuals that have achieved a level of fame through various digital media outlets (i.e. YouTube, Instagram, Vine, Facebook, Twitter, personal blogs, etc.).  Social media stardom is a relatively new phenomenon that is quickly starting to generate tremendous revenue for its stars, some of which have over 30 million followers.  With such a large online influence, there are unique legal and business concerns that these individuals should take into account while growing their brand.  This blog post will address some of the legal issues that are triggered by this type of social media.  Following posts will discuss some of the business concerns that should be addressed by these stars of social media.

Legal Concerns of Social Media Stars

1.      Social Media Star Endorsements

Many social media stars are unaware of the fact that the Federal Trade Commission ("FTC") requires social media users to clearly and conspicuously disclose when they are paid to endorse products and services.  In the FTC's Guides Concerning the Use of Endorsements and Testimonials in Advertising, the agency addresses some of the legal concerns that are triggered by the endorsed marketing efforts that are now pervasive in the social media environment.  Essentially, the FTC mandates that online fora fully inform the unsuspecting reader of any and all financial interests that the subject bloggers or social media users have in connection with blog posts, social media sites, articles or testimonials, as applicable, relating to the promotion of third party products or services. Even where the author has received free products for review purposes, the reader must be made aware of this fact through appropriate disclosures.

This means that bloggers who receive compensation for discussing a product or service must disclose that their comments are paid; but the requirement will also apply, for example, where someone receives a free stay at a hotel and then Tweets about how great the hotel is. While the FTC has not aggressively pursued individual bloggers or social media users with small followings, those with wider exposure may come under scrutiny.

2.      Trademark Infringement

Trademarks are a type of intellectual property that protect the name and/or logo of a brand.  Trademarks appear in almost every aspect of our daily lives.  Therefore, it has become increasingly challenging to upload a video or photo to a social media site without incorporating a third party trademark.  Please note that any such unauthorized use of another's trademark, whether intentional or unintentional, may lead to liability for trademark infringement, dilution or unfair competition.   Additionally, social media websites, such as Facebook and YouTube, have strict intellectual property use guidelines and any violations may result in a user's account being suspended temporarily or permanently.  This could lead to devastating consequences for the budding social media star.

Best practices counsel against using any third party trademarks in a video or photo upload.  If the use of a third party trademark is unavoidable, it is prudent to edit out applicable third party trademarks during post production, prior to publicly posting on a social media site.

3.      Copyright Infringement

Copyrights are a type of intellectual property that protect the expression of ideas.  Users regularly copy and post copyright-protected works, such as text, videos, music, photographs, and source code, onto social media sites without first obtaining the copyright owner's prior authorization.  Any such unauthorized use of another's copyright may not only result in the social media site in question suspending the user's account, but there is the added concern of potential liability for copyright infringement.

Best practices dictate that third party copyrighted material not be used.  Alternatively, the user should seek the copyright owner's permission before posting the material on social media sites.

4.      Privacy/Publicity

In addition to intellectual property issues presented by trademarks and copyrights, social media users must also be aware of certain privacy and publicity concerns. For instance, posting photographs and/or videos that feature the name or likeness of a third party without first obtaining proper authorization may violate the featured person's privacy and/or publicity rights.  Any privacy and/or publicity violations may lead to the affected person bringing a lawsuit against the infringing user.

Similar to the copyright concerns discussed above, it is advisable to avoid using the name or likeness of any third party without first receiving the person's permission.

The issues touched upon herein are just a few of the myriad legal issues that affect the social media landscape.  In forthcoming blog posts we will discuss the business concerns that should be addressed by social media stars.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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David O. Klein
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