Social Media and Liability

Social media sites have exploded with popularity. The growth of opportunity, information, and outreach is transforming and impacting insurers and other industries. Facebook, the most highly recognized social media site, is reported to have more than 750 million users. To put that in perspective, the U.S. Census Bureau estimates the population of North America to be 529 million. It is reported that over 140 million photos have been uploaded; the Library of Congress has less than one percent of that.

The use of social media sites is expanding daily to include selling goods, products, and services as well as promoting, cultivating, and developing a customer and fan base. All of this usage opens the window to liability.

The exposure and legal ramifications are not only for the owners of the sites, but also those businesses and individuals who use and participate on the websites. This is still new and unchartered territory, and courts are using existing laws that were enacted prior to this new technology. These laws do not entirely “fit” and do not necessarily pertain to the matters at hand. There will have to be new cases tried and new precedents set.

It has become commonplace for insurance companies to utilize social media sites to assist in the claims handling process. Regulations and laws are slowly emerging to govern the use of this information and access to it.

In a recent court case, which is now being referred to as the “MySpace” case, Vonda Barnhart was driving her vehicle and collided with Luis Perez, who was standing on the side of the road near a friend’s disabled vehicle. Perez sued Barnhart.

Barnhart’s defense, along with expert testimony, claimed that the toxicology reports indicated that she had normal neurological findings. The plaintiff’s attorneys alleged that the findings were consistent with those of a heavy drinker. Plaintiff’s attorneys were allowed to show the jury copies of Barnhart’s MySpace page that indicated she regularly used alcohol, had frequent hangovers, and included her entries or comments before and after the accident occurred.

The jury determined that Ms. Barnhart was 95 percent liable and that she had been grossly negligent, awarding the plaintiff more than $600,000.

Social media posts, texts, and photos are showing up in courtrooms everywhere, from accident cases, family court, workers’ comp, and other types. This information has been the basis of decisions to hire and even to fire someone.

Is all of the information out there public? What areas open you or your company up for potential litigation?

Copyright Violations

In social media sites, content is uploaded and reposted continuously. Do you have a legal right to continue to use this information without permission or proper attribution? With social media sites, people are taking other’s content without permission, and they are doing so without the realization that it may be prohibited.

Also, could capturing someone’s work or information for another’s benefit or use translate into money and profit issues? In social media using someone else’s content could be construed as misrepresentation and could lead to legal liability.

Privacy

With all of the information on the Web and the freedom to share personal information, we are faced with the issue of who owns the information and who has the rights to it. Does anyone really read the terms and conditions of the website prior to use?

Once you post your information, it then becomes public. Many believe that this information is private, but not so if a court order is involved. It has also become common practice for attorneys to request this information in the initial discovery period. They may ask for all social media sites and your log-in information. These sites also collect this information and sell it to advertisers and others for the purpose of target marketing.

What happens when your business or employees post information? Just because it is online does not mean that it can be copied or reposted; there are stiff fines for such violations.  The transfer, allowing access, and selling or buying of information can open you and your business up to liability.

Defamation

Many people now have a blog, and they cover everything from helpful hints to full-on rants with derogatory comments. While blogging has equipped us with a new-found freedom of expression, it also comes with the exposure to liability.

Defamation is considered the act of harming the reputation of another by making false statements. Libel refers to defamatory statements written or in other mediums such as pictures, signs, and other types, or representation that conveys an unjust and unfavorable impression or a statement or representation.

With all of the blogging that is going on, it is easy to understand the rapid rise in defamation litigation directly connected to it. Businesses and other entities have now come to realize the need for media liability or errors and omissions insurance. Social media is certainly new to us; however, lawsuits alleging defamation, libel, and slander are not. All of the blogs, tweets, and posts have increased the frequency of these allegations and lawsuits.

Limiting Liability

With increased awareness of potential liability, companies are educating themselves and their employees about the possible ramifications. Company policies regarding social media and the use of it on or off of the job are being developed.

Additionally, we are seeing cases in which the employer is being held vicariously liable for accidents while an employee is using a company cell phone while driving. Could the same hold true if an employee uses a company-owned computer to blog defamatory comments about another, or secure someone’s private information?

With social media being used to obtain information during the claims handling process, employers need to have clear guidelines set forth for retrieving information so that it can be legally used. Employees who use social media need to stipulate that their comments are their own and in no way should be construed to be the thoughts and opinions of their company or employer. It must be addressed in each company what will be the consequences for violating these policies.

There is no doubt that as social media usage continues to grow, so will the need to determine who is legally liable for the wrongs that are committed and the damages caused by the alleged legally liable acts and occurrences.  

Practice Tips from a Defense Viewpoint

CLM Member Carla Maresca, attorney with Deasey Mahoney Valentini & North, Ltd., recommends the following checklist for investigating claims using social media sites. For more tips, log into your CLM account and review the web seminar archive for the Sept. 12, 2012 presentation.

• Perform a thorough name search on Google and various social media sites for both the claimant and your client. Your client may have damaging public information that you need to know.
• Send a litigation hold letter to counsel upon receipt of defense assignment.
• Send a Facebook preservation letter.
• Print written content and photos available to the public. Your paralegal or secretary should perform searches weekly for updated information. Do not forget to open and print comments, which can provide useful information during discovery.
• Search for photos where claimant is tagged as well as posted.
• Look at friends and see if claimant posted on their friends’ public pages.
• Check for events that the claimant is attending.
• Check for associations.
• Subpoena social media sites to download and produce all stored information on claimant. Check your jurisdiction’s case law before preparing subpoena.