b'Whose Followers Are They? Establishing Ownership of Company Social Media Accounts AlertsA strong social media presence is an essential marketing tool for1 Changes to Minnesota Deed Tax most businesses. It is common for businesses to designate anMinnesota imposes a tax on each instrument that conveys an interest in Minnesota real estate. Currently, if the consideration for the conveyance, employee to manage and provide content for their companysminus the amount of liens that continue after the conveyance, exceeds $500, the tax is $.0033 ($.0034 for Hennepin and Ramsey counties) of that net social media accounts (e.g., Twitter, Instagram, and Facebook).consideration. If the net consideration is $500 or less, a minimum tax of $1.65 ($1.70 in Hennepin and Ramsey counties) is imposed.However, many businesses are unaware that, along withTexastransferring control over their social media accounts, they mayIn In re CTLI, LLC, No. 14-33564, 528 B.R. 359 (Bankr. S.D. Tex.This year the Legislature increased the threshold for minimum state deed tax to net consideration of $3,000 or less, effective for deeds presented for also be transferring valuable property rights and trade secrets to2015), a former business owner refused to relinquish controlrecording after December 31, 2019. This also means that an electronic Certificate of Real Estate Value (eCRV) will be required for deeds recorded after the designated employee. over the businesss social media accounts when the business filedDecember 31, 2019, only if the net consideration exceeds $3,000.While the law is finally catching up with technology and somefor bankruptcy protection. The former business owner claimed ownership of the accounts, arguing that he invested his time andThis change should facilitate some very small real estate transactions. However, it is still prudent to consult with legal counsel before recording a deed courts are addressing this issue, the results have been inconsistent.personality into their development. The court determined thator other real estate conveyance instrument.Some courts have determined that the social media accountthe social media accounts were the property of the businesss created by an employee (including all of its followers and likes)bankruptcy estate.belongs to the employee who controls access to the account.2 Minneapolis Adopts Ordinance Imposing Additional Requirements on EmployersIn those cases, the businesses have not only lost the legal battleNew York Many employers are aware that, on July 1, 2019, Minnesota law was amended to require that Minnesota employers provide a written notice with but also valuable property rights.In Ardis Health, LLC v. Nankivell, No. 11 Civ. 5013, 2011 WLspecified content to each new employee at the outset of the employment relationship. This statute has been referred to as the wage theft statute.Inconsistent Court Rulings 4965172 (S.D.N.Y. Oct. 19, 2011), a former employee refused to turn over her login information for the companys social mediaRecently, as a follow-up to the new state statute, the City of Minneapolis adopted an ordinance that mandates several additional requirements for the Pennsylvania accounts, which she managed during her employment. At thewritten notice to be given to new employees who work in the City. The ordinance also requires employers of personnel in Minneapolis to provide the In Eagle v. Morgan, No. 114303, 2012 WL 4739436 (E.D. Pa.start of her employment, the employee executed an agreementwritten notice to existing employees during the first pay period following January 1, 2020, which is the effective date of the ordinance.Oct. 4, 2012), an employee sued her former employer foracknowledging that all work created or developed by her shallThe ordinance applies to employees who work in Minneapolis for 80 hours or more in a year. The ordinance does not apply to persons who attend continuing to use the LinkedIn profile she created for the companybe the sole and exclusive property of the employer. The court after her employment was terminated. Finding that the companyfound that the employer indisputably owned the rights toa convention, conference, training, educational class, or similar event in Minneapolis if they do not perform other work in the City for an employer.had no clear social media ownership policies in place, the courtthe social media account access information pursuant to theThe ordinance requires that the notice document must include certain sick and safe time information, as well as the overtime pay rate and a statement determined that the employee owned the LinkedIn account. written employment agreement. that tip sharing is voluntary per state law. The ordinance also requires that the Citys notice poster must be distributed to employees at the start of California Create a Robust Policy and Agreement employment. Employers are expected to receive and maintain copies of signed employee acknowledgment forms that confirm receipt of the notice.In PhoneDog v. Kravitz, No. C 1103474 MEJ, 2011 WLBusiness owners should implement a customized social media 5415612 (N.D. Cal. Nov. 8, 2011), an employer sued one of itspolicy and employment agreement that bind owners and3 VoIP Telephone Remains Beyond the Minnesota Commissions Jurisdictionformer employees for refusing to turn over login and passwordemployees regarding the creation, maintenance, and ownership information for the companys Twitter account. During hisof company social media accounts. This proactive approach mayOn October 21, 2019, the United States Supreme Court declined to hear the Minnesota Public Utilities Commission (MPUC) appeal regarding whether employment, the employee accumulated 17,000 followers forprevent many of the problems that are arising in this rapidlystates can regulate Voice Over Internet Protocol (VoIP). The MPUC argued that the digital telephone is analogous to traditional telephone and that the account. Upon leaving the company, the employee changeddeveloping area of law. the FCCs refusal to regulate VoIP left the door open for states to assert jurisdiction. The telecommunications company, Charter Communications, Inc., his username, but retained the original followers. The formersuccessfully challenged the states ability to regulate information services, like VoIP, and argued that using the internet to connect a call defines VoIP employee then used the Twitter account to promote his newAylix K. Jensen is a member of our Financial Servicesas an information service.employera competitor of his ex-company. Among othergroup.Shepracticesintheareasofcomplianceand claims, the employer alleged misappropriation of trade secretslitigationrelatedtotheFairDebtCollectionPracticesThis decision may have implications beyond telecommunications law. In a three-page concurring opinion joined by Justice Neil Gorsuch, Justice Act, the Fair Credit Reporting Act, and the TelephoneClarence Thomas noted that he welcomed another case that would provide the Supreme Court with an opportunity to say whether the federal in its complaint. Denying the employees motion to dismiss theConsumer Protection Act, as well as other related state complaint, the court found that the Twitter account and itsand federal laws and regulations. governments decision not to regulate an industry preempts state regulation of that industry. Giving pre-emptive effect to a federal agency policy of password could constitute a trade secret under California law.612-877-5434|Aylix.Jensen@lawmoss.com nonregulation thus expands the power of both the executive and the judiciary, Justice Thomas wrote.2 The case ultimately settled. LawMoss.com/people-aylix-k-jensen If you would like assistance assuring best practices in these areas, please contact your attorney at Moss & Barnett. 3'