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LAW AND SOCIAL MEDIA An overview of key issues and recommendations

Briefing Paper Law and Social Media



A digital evolution


Social media marketing and contests




Intellectual property Social spamming and posting automation


International considerations




Afterword from Mishcon de Reya





Briefing Paper Law and Social Media

With all the undeniable benefits available to brands through social media, there also come inherent risks. We have all witnessed a wide range of incidents on social media that are now used as industry case studies of what not to do. Many have left brands red-faced. All have helped to shape codes, conducts and best practice. With the social media landscape in constant flux, it can seem a bewildering experience for brands to try to keep up with developments both digitally and legally. It is understandable then, why social media can seem daunting to many businesses. But there is still no reason to avoid it. The benefits gained far outweigh the risks. In the following chapters you will find an overview of key issues involved with the law and social media, along with detailed recommendations. With a trained workforce, the right processes in place and a comprehensive and reactive social media policy and crisis manual there should be no eventuality you cannot deal with. We are pleased to also feature expert legal insight from Emma Woollcott at law firm Mishcon de Reya.



Briefing Paper Law and Social Media

The growth of digital channels is a trend that will continue to impact brands across all sectors - not only those that are consumer facing. The opportunities are great but there are legal and reputational risks in engaging online. These are caused mainly by a lack of knowledge about how platforms should be used for marketing. Then there are incoming threats from third parties, as well as from your own employees. The social internet unavoidably exposes a company to scrutiny from online communities. It allows third parties (such as competitors, activists or hackers) to potentially damage a company’s reputation. It is essential that firms manage their online presence in a way that identifies the risks of both proactive and reactive communications. The range of rules, regulations and guidelines created to support ethical and lawful online conduct are fast evolving. The rules are introduced to keep up with the pace of developments in communication technology. For instance, the Director of Public Prosecutions, Keir Starmer QC, published a set of interim guidelines in December last year. He set out the approach prosecutors should take in cases involving communications sent via social media. Regulators have not been only focussed on online communications involving potentially criminal or libellous activity but also on guidelines covering consumer protection, privacy, direct marketing standards and many other areas. All have emerged over the past few years and have changed the way companies communicate. Some of these are more widely known than others. In many cases, people only become aware of them after they have been broken. Even if their activity was not unlawful, being seen to publicly contravene guidelines can attract negative attention. Companies need to know how to structure themselves internally. Managers need to know whether comments directed towards them are unlawful, and how to respond in ways that are lawful. Employees must be trained to appreciate the risks associated with their personal and business use of social media, and businesses should have systems in place to protect themselves from errant employees. This involves legal and marketing specialists within businesses working together to create a ‘risk ready’ approach.



Briefing Paper Law and Social Media

In 2011 the Advertising Standards Authority (ASA) expanded its code of conduct, named the Committees of Advertising Practice Code (or ‘CAP Code’), to cover online marketing. The code covers all online communications and has sector-specific guidelines covering food, gambling, alcohol, motoring and many other areas. These rules cover not only paid advertising, but also earned and owned media messages on brands’ own websites and social profiles. It is a marketers’ responsibility to adhere to the CAP Code. Others involved in executing marketing communications activity on a company’s behalf, such as agencies and copywriters are also obligated to abide by the Code. Independent bodies such as the ASA and the Office of Fair Trading (OFT) make similar stipulations. A case in 2010 involved the OFT itself against blogger network Handpicked Media. It investigated whether the company was operating in breach of the Consumer Protection from Unfair Trading Regulations 2008 (CPRs) as a result of its conducting of online promotional activity in ways that made it unclear that the promotion had in fact been paid for. Handpicked Media then cooperated with the OFT to ensure compliance going forward. It was likely that changes made would impact not only the nature of the campaign but also on the reputation of the companies indirectly involved with this case. Heather Clayton, Senior Director of OFT’s Consumer Group, said at the time: “The internet plays a key role in how people purchase products and services and the importance of online advertising continues to grow. The OFT has bolstered its expertise in this area and is taking targeted action to ensure that the law is clear, increase business compliance and empower consumers. The integrity of information published online is crucial so that people can make informed decisions on how to spend their money. We expect online advertising and marketing campaigns to be transparent so consumers can clearly tell when blogs, posts and micro-blogs have been published in return for payment or payment in kind. We expect this to include promotions for products and services as well as editorial content.” In addition to the rules above, many social networks have their own codes of conduct. An example of this is Facebook, where there are restrictions on the ways you can run offers and competitions. There are also rules on how to design a cover photo (details of which can be found here).


Briefing Paper Law and Social Media

Recommendations Social media messages on profiles, or within apps, are often creative and concise. However, a 140-character limit on Twitter, or a desire to be brief and impactful, must still give potential customers the full story regarding the product or service. Competitions on social networks are a popular method to engage consumer communities online. The code’s provisions, however, can create challenges for marketers running these campaigns. A number of seemingly innocuous words (such as “free”) come with a series of conditions on how they should be used. To avoid being seen to mislead consumers, take into account the following factors: • Prominently display links to terms and conditions if you are running a competition. Link back to supplementary information about a product or service you are promoting. • Be transparent – always ensure those who promote your products on your behalf disclose their affiliation. • In a competitive market, it is tempting to describe a product as ‘leading’, ‘the first’ or ‘best’. If so, provide links that substantiate the claims. • Be sure to be familiar with the terms of use for popular social platforms such as Twitter and Facebook. This will avoid having a social profile removed from the network by mistake.



Briefing Paper Law and Social Media

In 2012, we saw the year of the social media libel case. The national newspapers gave the most attention to Lord McAlpine against the BBC and ITV, which saw those who re-tweeted the story being approached by McAlpine’s lawyers. The case between cricketer Chris Cairns and Lalit Modi was more significant as it provided the first ever successful legal action against a defendant for tweeting content that was later to be found to be in breach of libel law. While libel is often a legal issue concerning individuals, marketers should also be aware of its relevance in a corporate setting. It’s here that critics may make unsubstantiated claims about products services or senior executives. Online monitoring tools will pick up such comments, so it is essential that there are processes in place to pre-empt and/or deal with them.

Recommendations • Having an up to date crisis manual and process in place is essential. • Social Media Policies and regular staff training are essential. • Consider running ‘social fire drills’, where crises are simulated, and teams get the opportunity to practice what they would need to do in a closed and controlled environment.



Briefing Paper Law and Social Media

Those running corporate blogs run the risk of infringing copyright and other intellectual property rights. In 2009, Google launched a feature on Image Search to help online publishers find images that they could use for free. The feature retained the respect of the wishes of photographers and other visual content creators. It helps those looking to use images online to restrict their search results to those that have been tagged with Creative Commons or GNU Free Documentation license for free use. However, many businesses still appear to be unaware of how to find non-copyrighted images and. are using them without crediting or paying the owner. For instance, the Forum of Private Businesses issued advice to its members after receiving an increase in calls demanding payment for unwittingly used copyrighted images.

Recommendations • Companies, especially those running multiple blogs in multiple countries, can lose track of the images being used on their social platforms. To avoid any issues maintain a private image library, use a paid service, and search for royalty-free content. • Ensure web copywriters, freelance bloggers and community managers are aware of the issues. • Always credit images where there is a clear owner. Where there is no clear owner, credit the site from which it was sourced.



Briefing Paper Law and Social Media

Most commercially astute businesses, that run newsletters, are aware of the CAN-SPAM act. These companies tend to be less sure about actions that may result in the brand being perceived as a spammer on Twitter. Whereas Facebook’s functionality has evolved to effectively thwart all but the most determined spammers, this is not the case on Twitter. There are a number of third-party apps that promise to help brands amass large numbers of followers. A legal debate rages on, regarding whether these “mass adding” or “mass follow” platforms should be seen as spammers or not. Twitter itself, in early 2012, launched legal actions against Skootle Corporation for its use of popular Twitter marketing tool TweetAdder. The latest chapter in this story is that Twitter has successfully demanded that Skootle produce papers relating to the operation of its company. It also launched a page giving guidance on using tools that automate common social actions on the network. This was aimed to help legitimate companies and individuals avoid being associated with spammers and treated accordingly. Regardless of whether tools used have been defined as legal or not, for organisations that have internally set targets for community or follower growth, it may be tempting to use marketing software to boost numbers. But as the BBC’s Rory Cellan Jones’ spoof experiment with VirtualBagel demonstrated, not all likes are equal in value - and Facebook’s crackdown on false profiles means that any gains will likely be short lived.

Recommendations • Marketing and legal teams must take care when vetting third-party applications and check they do not violate a platform’s terms of service. • Companies like Habitat have attracted negative attention due to the practice of ‘hashtag hijacking’ on Twitter. This involves inserting a brand into an often-unrelated conversation. It may also be considered as spam, as well as being damaging to a company’s reputation.



Briefing Paper Law and Social Media

Because all communications online are borderless, we need to know about how legal developments internationally impact proactive campaigns. In 2009 the US FTC published changes to the law regarding testimonials and advertisements involving celebrities and bloggers. Now, when using celebrities and business leaders, all endorsements must contain a clear disclosure. Twitter, for instance, provides an ideal platform for promotion as celebrities in the consumer and business can earn thousands for endorsing products and services. However, the US Federal Trade Commission, as well as the Advertising Standards Authority, insist that tweets include the words ‘#ad’ ‘#paid’ or ‘#spon’ to show followers that the endorsement has been paid for.

Recommendations • The more countries your promotional campaigns are active in, the more rules and regulations there are to comply with. In particular looking at the United States, each of the states has different rules – so it essential to understand fully how those rules affect your campaigns.



Briefing Paper Law and Social Media

Warren Buffett famously said: “Lose money and I will forgive you, but lose even a shred of reputation and I will be ruthless.� Companies need to monitor what the wider world is saying about them. The question is how many take this seriously until a crisis strikes? The super-injunction debacles showed how difficult it can be to keep stories out of the public domain. Legal and marketing strategists now have to respond to crises in the full glare of public scrutiny. In this way alone, digital communications have changed the business world. Boardrooms must now keep up with the pace of change. Legal and reputation risks are core responsibilities. Executives need to drive this conversation forward. Social media provides real-time brand reputation insights, which can no longer be ignored as a PR domain alone. Social media can be incredibly powerful force for good. From building strong customer relationships to developing brand communities. Yet the stakes are high for firms not engaging or tracking this space. Whatever senior executives think about the importance of social media, there is one thing the boardroom should know for certain, doing nothing is not an option.


AFTERWORD FROM MISHCON DE REYA Managing the risks of social media: Tips for commercial brands

Briefing Paper Law and Social Media

Brands from all industries are increasingly embracing social media to build and maintain their on-line reputations, to engage with consumers, and to enhance their commercial objectives. Few may be as quick to appreciate the risks which social media can pose to hard-earned reputations, and fewer still appear to have put effective procedures in place to protect against such challenges, and to mitigate their potentially destructive effects. To understand, address and minimise social media challenges, brands should adopt a “risk ready” approach, which might include the following: Beware the “intern” / the “over-enthusiastic” employee Brands are advised to effect and enforce comprehensive social media guidelines, training programs and policies, so that all employees and contractors are educated as to the appropriate and acceptable use of social media, both for business and personal purposes. Clear guidance should be given to those entrusted to speak on behalf of your business, so that messages are consistent, and challenges dealt with effectively. Careful thought should be given to monitoring staff use of social media, and the sanctions for breach of your social media policy. On-line attacks – the media, bloggers, campaigners Brands wary of reputational attacks are often cautious about proffering information into the public domain; viewing social media as an unnecessary and uncontrollable risk. However, as the internet is increasingly used as a source, and indeed a platform, for third-party attacks, it is generally prudent to construct and maintain a consistent internet presence, and to have effective procedures in place to deal with requests for information. The proliferation of data and speculation on the internet, and cultural shifts about the levels of transparency expected of corporate entities, means that businesses can appear secretive or devious if they fail to engage. When challenges or questions are raised – whether by journalists, dissenters or even unknown parties – it is important to consider the agenda of the interrogator, and the effect your answers are likely to have. Key stakeholders must be equipped to deal with complaints and information requests, and receive bespoke media training to understand the principal legal concerns. Brands are advised to work with their lawyers and PR to think strategically about their on-line presence and messaging, addressing negative content and responding to further threats in an appropriate and timely way.


Briefing Paper Law and Social Media

Hackers / cyber attacks Experts suggest that 99% of data theft may be prevented by taking straightforward measures. It is surprising, therefore, that so many headlines are created by Twitter feeds being hijacked, confidential information being hacked, and corporate websites being compromised. In addition to taking steps to prevent negative stories emanating from within the business, proactive steps should be taken to ensure that hackers cannot penetrate the IT systems which brands put in place to protect their valuable reputation and assets. Social media offers significant opportunities for brands who wish embrace it. Even those who decide not to engage with social media in a proactive way will put their businesses in jeopardy if they fail to consider the ramifications of an increasingly on-line dialogue, and to implement appropriate safeguards.

Emma Woollcott is a litigator in Mishcon Private. She is a specialist in defamation, breach of confidence, invasion of privacy, harassment and injunctions. She advises individuals, companies and charities on reputation management issues, often in the context of wider disputes and in times of crisis. She is well-versed in new media and Internet-related issues. She provides claimants and defendants with pre- and post-publication advice, often on an urgent basis.


Briefing Paper Law and Social Media

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Law and Social Media  

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