This post is by Stephen Easley, vice president for government affairs and general counsel of F2 Technologies, a wireless data technology company. He is attending his 25th SXSW Festival.

Emilio Nicolas and Stephanie Chandler of Jackson Walker, an Austin technology law firm led a very lively discussion at a South by Southwest Interactive Festival panel, during which the attendees learned five very hard lessons about the state of the law on social media, blogging and beyond that every company should take to heart:

  1. International is the new local — Companies used to worry about complying with local state laws, and occasionally, federal law. The Internet, search engines and e-commerce have obliterated boundaries and in doing so, forced companies to think about the laws of distant places where their business activities now reach, thanks to the Web. The panelists shared the story of a client who was faced with a European Union action after the client’s privacy policies — which are perfectly acceptable in the U.S. — ran afoul of new EU privacy rules. Another example was the German legal action against U.S. citizens selling World War II memorabilia on eBay, an act that violated German prohibitions on promotion of the Nazis. New Corporate Rule: Does this play in Potsdam as well as Peoria?
  2. Every idiot is a publisher — Although the Internet may not have increased the number of idiots in the general population, as one speaker wryly noted, it does increase their ability to do harm and to suffer legal damages because of their actions. The Web allows virtually everyone to be a publisher, where in the past, traditional media such as newspapers and television news departments acted as filters to stop some of the worst offenders. One of the examples of this was the recent lawsuit by a fashion designer who sued Courtney Love for defamation and received a settlement of more than $430,000. As the Nicolas noted, Love likes to use every one of her 140 Twitter characters in the most colorful fashion — but the reach of her tweets to her more than 40,000 followers likely convinced her legal team to settle rather than allow the plaintiff to explore the extent of the damages. New Corporate Rule: Everything on the Web is “published.”
  3. Damned if you do, damned if you don’t – The U.S. government took heat during the panel for the conflicting rules it applies against corporations regarding their Twitter, blogging and other online activities. The contrast was starkest between new Federal Trade Commission rules and a recent National Labor Relations Board case. The FTC held that companies must monitor closely and regulate precisely the Twitter, Facebook and blogging activities of its employees, holding them liable if they don’t. For example, if an employee promotes their company’s products in any way, e.g., reviewing a TV positively on their private Facebook, they must “clearly and conspicuously and in close proximity to the message” disclose that the employee is, in effect, a corporate shill. At the same time, the NLRB sued an ambulance company for disciplining an employee who said terrible things about the company on Facebook, forcing the company to settle. New Corporate Rule: Monitor your employees’ Web use, but think twice before you censor.
  4. The rules may be the same, but the game sure is different — Chandler emphasized that while the law is changing slowly, technology is moving much quicker, thus changing the game in important ways. First, the permanency of the Internet through caching and search means there is always a record of what you put on the Web. The reach of the Net multiplies that effect and the scope of its impact, particularly in damages. New Corporate Rule: Think twice, post once.
  5. Not everything on the Internet is free — Contrary to conventional wisdom, “Fair Use” is not a state where you can go and do anything you want with anything you find on the Web. Many things you download are the intellectual property of musicians, photographers and writers who can and will protect their property. New tools allow creators to track and discover unauthorized uses. While recent music-downloading cases showed how bad these suits can be for individuals, recent actions show that companies must be vigilant on unauthorized employee use, as copyrighted pictures and writing downloaded from Web have shown up on corporate websites and presentations. New Corporate Rule: Require attribution and clear use of any downloaded materials.

How are you responding to the legal challenges posed by the social Web?

Image Credit: AlexMax, via iStock Photo

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2 Responses to “From #SXSW: 5 new corporate rules for avoiding social media legal woes”

  1. Actiance says:

    The social Web is continuously in flux, but one thing remains constant: the information you share on social media sites may come back to haunt you, and not all information is meant to be shared on the social Web. Copyright infringement, defamation and a host of other legal issues often result when sharing sensitive information.

    At Actiance, we stress that companies look beyond their local borders when assessing compliance. Now, due to the global nature of the Internet, enterprises also have to be wary of international laws that impact the business.

    Technology also moves faster than legislation, but this pace won’t likely limit parties in lawsuits from claiming more in damages as a result of the Internet reaching far more millions of people than in the “old days.”

    Ultimately, companies must apply and enforce corporate social Web policies consistently and evenly. Monitoring and archiving social media and Web 2.0 use must be an even-handed process (without regard to race, gender, age, etc.) to avoid potential discrimination lawsuits.

  2. @vbuckley says:

    The Courtney Love case should be taken with a lump of salt. She blasted her networks with reports that the designer was a " drug pushing prostitute" with a history of abuse etc, after the designer requested payment for a gown.
    Please don't let this be the only evidence that businesses and corporations always have to toe the p.c. line. One of the things that earns peoples trust and engages them is honest opinion. Rule no 1 of social networking- thou shalt not be boring !
    Anyway, Courtney ( deservedly) lost the suit, but she did gain 40k more twitter followers ;-)

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