Chapter 2: Intellectual Property
Contributors to This Page: Brian D. Wassom
Suggested Citation Form for This Page: Brian D. Wassom et al., Wassom on Social Media Law Chp. 2.C, available at <wassom.com/wosml-2c.html> (last edited Feb. 28, 2013)
C. The Right of Publicity
The right of publicity is a state-law right that emerged from the common law of privacy to become more or less recognized as a form of intellectual property. Although the particulars vary slightly from state to state, it is essentially the right of an individual to control the commercial exploitation of his or her likeness. The best summary of the right of publicity as generally understood across the United States comes from the Restatement (Third) of Unfair Competition section 46: “[o]ne who appropriates the commercial value of a person’s identity by using without consent the person’s name, likeness, or other indicia of identity for purposes of trade is subject to liability.”
1. Commercial Value and Commercial Exploitation
The “commercial” aspect of this right is intentional. It’s what distinguishes the use of someone’s likeness in creative expression like a movie or song–which is generally free speech privileged by the First Amendment–from commercial speech designed to advertise and sell goods or services, which is more akin to a trademark, and hence within the realm of governmental regulation and property rights.
In order to prevail on a publicity rights claim, therefore, a plaintiff must generally prove that her identity has “commercial value”–i.e., that there’s reason to believe that her identity would be worth something to an advertiser, or that a customer might be more likely to pay attention to a product because the plaintiff’s identity was associated with it. For that reason, courts had long ruled that the right of publicity was only available to “celebrities,” and not the rest of us.
Today, however, the rise of digital (and especially social) media makes it entirely realistic to argue that we can all attain commercial value in some context. One argument for establishing “commercial value” in social media is the value of personal relationships. On many social media sites, the identity of the person with whom one interacts in social media both incentivizes people to participate in the site and adds qualitatively significant value to the experience. And the more such interactions that occur on a particular social media site, the more benefit the owner of that site derives (in terms of advertising revenue, search engine tie-ins, or whatever the site’s business model may be). Therefore, in a very direct and measurable way, some would argue, social media is a context in which literally every user’s identity has potential commercial value.
Judge Richard Seeborg of the United States District Court for the Northern District of California credited this argument in Cohen v. Facebook. That case involved Friend Finder, a service that a Facebook user can choose to employ by giving the system access to email accounts the user may have on other services. The system then searched the contact information in those accounts, compares it to the Facebook user database, and presented the user with a list of other Facebook users he or she already knows, but who are not among his or her Facebook friends. Plaintiffs objected to the use of their names and photos in the ads generated by the Friend Finder service.
Judge Seeborg credited the argument that Facebook’s “ability to earn advertising revenues and its valuation as a company are dependent on the size and involvement of its user base.” Therefore, “the alleged misappropriation of plaintiffs’’ names and likenesses to promote the Friend Finder service was undertaken for Facebook’’s “‘advantage.’” In a later opinion, however, the judge tempered this observation, “noting that this is not a situation where the defendant is alleged to have publicized the plaintiffs’ names or likenesses to any audience or in any context where they did not already appear.” Rather. the plaintiffs’ likenesses were seen only by people with whom they were already friends. Ultimately, Judge Seeborg dismissed the case (twice) because plaintiffs could not prove that their likenesses had any commercial value or that they had been harmed in any way.
Another case filed in the Northern District of California, Fraley v. Facebook, involved a different Facebook feature—namely, “Sponsored Stories.” These advertisements “appear on a member’’s Facebook page, and which typically consist of another member’’s name, profile picture, and an assertion that the person ‘likes”the advertiser, coupled with the advertiser’’s logo. Sponsored Stories are generated when a member interacts with the Facebook website or affiliated sites in certain ways, such as by clicking on the “Like” button on a company’’s Facebook page.”
Unlike Judge Seeborg, Judge Koh rejected Facebook’s suggestion that plaintiffs were required “to provide proof of preexisting commercial value and efforts to capitalize on such value in order to survive a motion to dismiss.” Rather, she ruled that “the appropriation of the identity of a relatively unknown person may result in economic injury or may itself create economic value in what was previously valueless.” She also quoted multiple interviews in which Facebook executives described the power of personal relationships and the recommendations of trusted friends, treating these as admissions that users’ identities have commercial value. Judge Koh cautioned, however, that it was still plaintiff’s burden to “prove actual damages like any other plaintiff whose name has commercial value.”
In Eagle v. Morgan (E.D. Penn. March 12, 2013), a banking company was found liable for infringing the publicity rights of its former CEO, Dr. Eagle. When Eagle left her position, the company used her password to access her LinkedIn account and lock her out of it. They then replaced her information with that of the new CEO. For a period of several weeks, therefore, whenever someone searched for Eagle and followed the link to her profile, they found the information for her replacement instead.
This decision sheds more light on the types of evidence to which courts will look in determining whether an individual’s identity has “commercial value”–which is typically a prerequisite to the existence of actionable publicity rights–in today’s digital economy. Here, the court found that Dr. Eagle’s identity “has commercial value due to her investment of time and effort in developing her reputation in the banking education industry. She testified that she is a published authority, has been quoted in others’ publications, and has presented at conferences. Further, … [she] had extensive experience in the banking education industry and generated substantial annual sales.” Those factors could be applied just as easily to executives and professionals in all sorts of industries, meaning that this is risk factor that every employer should take to heart when publishing in social media.
In this context, one’s “likeness” typically takes the form of one’s physical appearance, name, signature, or voice. The Restatement expressly lists two examples of ways in which a person’s identity can be “indicated”: their “name” (which typically includes both the name itself and the person’s signature) and their “likeness,” or personal appearance.
But the common law includes in that term any other “indicia of identity.” So a famous race car driver’s likeness was infringed by using a picture of his distinctive car. Johnny Carson’s right of publicity was infringed by the product name “Here’s Johnny Portable Toilets.” And Vanna White’s likeness was found to have been exploited by a robot turning the letters on a futuristic Wheel of Fortune set.
In February 2013, a circuit court judge in Oakland County, Michigan entered a temporary restraining order and (later) a preliminary injunction against a merchant selling hockey jerseys and other merchandise under the name PASHA. “Pasha” is the nickname of Detroit Red Wings forward Pavel Datsyuk, and some of the items being sold bore his number 13 and the red-and-white Red Wings color scheme.
3. Infringement Online
“Social” media–which by definition is all about interacting with other individuals–is especially prone to abuses of individuals’ identities–especially with billions of photographs available for instant download. In 2007, a 15-year-old Texas girl sued Virgin Mobile after learning that the company had found an unflattering picture of her on Flickr and used it in an Australian ad campaign. In June 2009, a Missouri couple discovered that a Christmas family portrait they had shared with relatives online had become an advertisement for a grocery store in the Czech Republic. Because the very point of “social” media is the exchange of personal information, photos, and other content,the percentage of such information that carries with it the potential for incorporating someone’s identity is much higher than in other forums.
4. Who Can Use Another Person’s Image?
When employees who actively use social media accounts to promote their employer’s business leave their jobs, it can lead to disputes over whether those accounts and their followers belong to the employer or employee. Several such disputes have arisen in recent months. When employers continue to operate these accounts after an employee leaves, it could give rise to a right of publicity misappropriation claim.
That is what happened after Jill Maremont was involved in a serious car accident in September 2009. Maremont managed the Facebook and Twitter presence of her employer, a Chicago interior design firm. In Maremont’s absence, her employer appointed a replacement editor to manage the accounts. She eventually sued, claiming, among other things, that the employer’s posts to these accounts in her absence unlawfully traded on the goodwill that she had personally built up through them, and confused her followers as to whether she or someone else authored the content.
Although her right of publicity claims survived the pleading stage, she eventually lost them on the merits. Discovery ultimately showed that the employer announced Maremont’s accident through the social media accounts, identified the new editor as a temporary replacement, and Maremont herself thanked the replacement editor for her work after she regained control of the accounts. Therefore, the employer “did not appropriate Maremont’s identity.”
By contrast, in concluding that the employer’s actions in commandeering Dr. Eagle’s LinkedIn account were unjustified, the court repeatedly points out that her employer–although clearly concerned about its employees’ social media presence–did not have a policy in place determining who owned the accounts. The strong implication is that, if the employer had adopted and Eagle had signed a policy making clear the employer’s right to control the account, the result may well have been different. Obviously, we lawyers can’t say it enough: employers, you need to implement a clear social media policy before issues like this arise.
In early 2012, luxury fashion retailer Burberry took advantage of Facebook’s then-new “Timeline” chronological display to showcase the use of its products by historical celebrities over time. The timeline began with the launch of the first Burberry store in 1856. Under the 1942 header, Burberry posted a photo of the actor Humphrey Bogart with the caption, “Humphrey Bogart wearing a Burberry trench coat in the final scene of Casablanca.” Burberry had licensed the copyright in the image, but an entity claiming to own Bogart’s posthumous publicity rights threatened to sue for misappropriation of his likeness. In May 2012, Burberry filed a declaratory judgment action in New York seeking to confirm its right to use the image.The Bogart entity countersued for misappropriation of publicity rights and related claims. Both suits were later resolved out of court without adjudication.
5. What About the First Amendment?
Judge Koh’s Fraley opinion may have been the first to attempt to balance publicity rights and free speech rights in the social media context. Facebook had argued that the information it shared in “Sponsored Stories” concerning users’ “likes” and activities was were “newsworthy because (1) Plaintiffs are ‘public figures’ to their friends, and (2) ‘expressions of consumer opinion’ are generally newsworthy.” California’s publicity rights statute includes exceptions for “”use of a name, voice, signature, photograph, or likeness in connection with any news, public affairs, or sports broadcast or account, or any political campaign.”” “This First Amendment defense extends to ‘almost all reporting of recent events,’ as well as to publications about ‘people who, by their accomplishments, mode of living, professional standing, or calling, create a ‘”‘legitimate and widespread attentionn’ ‘ to their activities’ ””—i.e., to “public figures.”
Facebook cleverly attempted to turn plaintiff’s’ assertion of commercial value on its ear. If plaintiffs are “celebrities” in the eyes of their friends, it argued, then, as “celebrities,” they are newsworthy individuals, and the reporting of their actions via Sponsored Stories is news reporting protected by the First Amendment.
Judge Koh “agree[d] with [Facebook] that Plaintiff[s] ‘cannot have it both ways’ — Plaintiffs cannot assert economic injury under the theory that they are ‘celebrities’ to their Facebook Friends, while at the same time denying that they are ‘public figures’ to those same friends for newsworthy purposes.” But she did not give the argument as much import as Facebook did. “[E]ven newsworthy actions,” she held, “may be subjects of [misappropriation] liability when published for commercial rather than journalistic purposes.” That assertion raises some red flags among First Amendment advocates, and is certainly subject to being tested and qualified by future case law. But Fraley demonstrates that First Amendment considerations will not always protect against liability for misappropriation of publicity rights.
Proving the value of a person’s identity–especially when that value was derived online–has proven tricky. There is not yet any set formula for reaching a valuation.
In 2012, the parties to Fraley v. Facebook announced a settlement by which Facebook would pay $10 million to nonprofit groups and up to $10 million in attorneys’ fees. This settlement generated at least as much publicity as the lawsuit itself when the court rejected it as insufficient. The court later approved a settlement under which $20 million would go directly to Facebook users instead.
By contrast, Dr. Eagle’s victory was a Pyrrhic one. Although she prevailed on multiple counts stemming from the misuse of her likeness, she was awarded a grand total of $0. Why? Because she couldn’t prove that she’s actually been harmed by the diversion of LinkedIn traffic. That wasn’t for lack of trying; Eagle presented detailed reports of her sales revenue for the year in question, and analysis of it had dipped. But the court found her explanation connecting those figures to the employer’s actions “nothing more than creative guesswork based on mere speculation.” Similarly, the court refused to award punitive damages, because Eagle did not present evidence suggesting that her employer had acted out of a malicious intent to injure her.