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that can have commercial value. It allows the “friend” to be contacted and advertised to. This information goes beyond what is publicly available. Duplicating all the information available from the “friends” list would be time-consuming and costly. The public can see the names of the company’s “friends” online, but the public does not have all the other information that the company gets by virtue of having these “friends.”
In September, 2014, another federal court held that LinkedIn contacts could be a trade secret. In Cellular Accessories For Less, Inc. v. Trinitas, LLC4, a company sued an ex-employee who had left to form a competing company and taken his LinkedIn contacts with him. The ex-employee moved for dismissal of the lawsuit. The court denied his motion, holding that the LinkedIn contacts that he had developed while working for his former company could be the company’s trade secret. The company had encouraged the employee to develop LinkedIn contacts during the employment. The court said that the LinkedIn contacts may – or may not – have been viewable by other LinkedIn users; the ex-employee’s motion papers did not say whether the contacts were publicly viewable. Since they may not have been publicly viewable, they could be the company’s trade secrets.
Given the unsettled nature of these issues, as well as the rise in trade secret litigation across the country, courts will likely continue to provide conflicting answers as to how to categorize employees’ social media accounts. Employers and employees should think carefully about these issues, in particular (1) at the time when an employee opens a social media account that he or she uses to promote the company’s business, and (2) when that employee departs from the company and may want to bring the account, and its valuable followers, with him or her. If the employer believes that the account is the company’s property, it should make that clear to the departing employee before he or she leaves and takes the login credentials with him or her. Note: many employers are now specifically including limitations on post-employment social media activity by the ex-employee in their non-compete and non-solicitations agreements at the outset of the employment, to address and avoid issues and disagreements post-employment.
4 Case No. CV 12-06736 DDP (SHx), US District Court, C.D. California, September 16, 2014
Walter Judge is an FDCC Defense Counsel Member and a Partner with Downs Rachlin Martin PLLC, in Burlington, VT. Contact him at: WJudge@drm.com.
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