Certainly, there is little time to train summer interns. Their activities on social media may pose unusual risk for a company. Summer interns may have no idea that they have stumbled on confidential information. They usually do not understand about intellectual property protection or FTC Testimonial and Endorsement Guidelines. They may not have the maturity to separate their personal and professional social media activities. Yet, few companies have given thought to creating social media policies for their seasonal employees.

While I typically advocate for empowering employees to act as brand representatives in social media, I do not recommend such a philosophy with summer interns. At the same time, First Amendment rights do not allow a company to control personal postings. In addition, a summer intern who posts positively about his experiences at a company can be a public relations boon. Below are some suggestions for guiding summer interns in social media.

1. Prohibit the summer intern from accessing personal social media pages on company equipment. Remind him that use of personal mobile devices could interfere with productivity expectations.
2. Do not give the intern access to the company’s official social media pages without supervision and vetting of any posts.
3. Clearly notify the summer intern that he is responsible for any post on his personal pages that reflects negatively on the company. Give him some specific examples rather than just stating policy.
4. Allow the summer intern to mention his internship in his personal pages (e.g. interning at Company xyz).
5. Encourage him to limit commentary to his own personal experience. Require a disclaimer in all social media posts that allude, even indirectly, to the company, his internship, or its products/services.
6. Discourage any postings of any reviews of Company’s products/services, and remind him to post that he is currently employed as a summer intern if making any such reviews.
7. Give specific advice about how to do disclaimers in space limited platforms such as Twitter. Include instruction on hashtags and links.
8. Provide specific disclaimer language to the summer intern and show him how and when to use it.
9. Have the summer intern sign an acknowledgement of these social media policies.
10. If possible, on the first day of work, have the summer intern meet with a company representative to talk through your policies.

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP.  For more information about her law practice, please visit www.kbhilferlaw.com.

If you’re interested in crafting a social media policy or learning how to best protect your organization consider attending the Social Media Legal Risks and Strategies Summit in San Francisco this October 4-6

The details of the employee’s work history have not been made public, making it impossible to evaluate fully the propriety of the firing. We can, however, draw a few conclusions from this incident.

Even social media “specialists” can make mistakes. Perhaps this tweet would not have led to employment termination if the specialist had just omitted the reference to golf. Did LVEDC have any system of checks and balances or could the employee post what she wanted because she was a “specialist”?
Training is an ongoing process. As an attorney practicing in the space, I go to great lengths to explain to clients that a policy is not sufficient. Training is a requisite companion for the policy. The training should use real life examples of tweets like this or Facebook posts that have resulted in conflict with employers.
Confidentiality and privacy are dynamic concepts. Many of the “social media specialists” are young (20′s,early 30′s) and have different interpretations of privacy from older employees.  Companies need to train their employees about their expectations. At the same time, as case law emerges in this area, we will see if young law clerks have sway over the judges for whom they research and write opinions. As court cases create meaningful precedents, readers should watch for subtle shifts in societal norms to see if they permeate the decisions.
Consider the PR fallout from firing. This incident created a lot of buzz on the Internet. LVEDC received some bad press. Companies must balance their legal rights with the impact of enforcement on their reputations.

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP.  For more information about her law practice, please visit www.kbhilferlaw.com.

If you’re interested in crafting a social media policy or learning how to best protect your organization consider attending the Social Media Legal Risks and Strategies Summit in San Francisco this October 4-6

STEP ONE:

Familiarize yourself with the social media platforms’ rules. Read the terms of use, privacy statements, guidelines, and FAQ for the platforms in which you have an interest. Discern differences in their treatments of trademarks, copyrights, privacy, and prize promotions. Determine how the platforms’ rules align with your own brand’s protections.

STEP TWO:

Create policies that protect your brand.  Your social media team should consist of legal, HR, and marketing personnel. The team should plan your brand’s social media policies for your people and your intellectual property. Policies for people should consider the requirements of the FTC Endorsement and Testimonial Guidelines. They should also guide employees on how to engage in social media in a way that promotes the brand and makes sense for your own corporate culture. There is no one size fits all social media policy. Each company should draft its policies to align with preexisting guidelines for social interaction, email, confidential information, and intellectual property protection. Your policies for intellectual property in social media should outline consistent use of your trademarks, DMCA takedown procedures, and protection of your trade secrets.

STEP THREE:

Engage legal counsel in creating a marketing plan. Do you want to invite user generated content? How will you vet the content before posting? How will you monitor responses to the content? How swiftly can you respond to content or remove it from your pages? As you roll out into the social media space, you may take on a prize promotion or a branded loyalty program. Perhaps you will consider using geo-location technology to enable behavioral marketing. Bring legal into the discussion early as you plan strategy and your marketing approach. Rewrite your privacy policies if necessary. Review the legal paradigms that apply to your marketing efforts. Your counsel should support your business goals and be able to help you create meaningful programs with minimal legal risk.

STEP FOUR:

Think proactively about other venues. The next frontier is mobile marketing. How will your social media program connect to mobile? How do the social media platforms you are on allow you to extend to mobile? Consider how your brand wants to communicate with its customers to obtain the requisite opt-in for each mobile marketing effort.

STEP FIVE:

Balance enforcement with public relations. Remember that in the world of social media, cease and desist letters have frequently back-fired from a public relations perspective. Consider the amount of harm being done to the brand and respond in a proportionate way. Examine the Righthaven cases to avoid being seen as a “bully” in the marketplace. Remember that in social media, anti-social behavior can harm a brand far more than a technical copyright infringement.

© Kyle-Beth Hilfer, P.C. 2010. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP.  For more information about her law practice, please visit www.kbhilferlaw.com.

In late February, the FTC filed a text message spam case alleging violations of the CAN-SPAM Act (described earlier on this blog). Only a few days before the Summit, the FTC  slammed Rascal Scooters with a $100,000 fine to settle charges that it had illegally used phone numbers from sweepstakes entry forms to contact consumers who were on the Do Not Call Registry. The case reminds mobile marketers that a sweepstakes entry does not create an existing business relationship for purposes of the FTC’s Telemarketing Sales Rule. Just because a consumer gives a marketer his mobile number does not mean he has opted-in to specific campaigns.

The day after the Summit, class action lawsuits were filed in California against Twitter, Facebook and MySpace, complaining that text messages confirming that a user wanted to opt out violated the TCPA.  The class action plaintiffs assert once they texted “STOP” to the short code, no confirmation should happen on their mobile devices. Many commentators have called these class action suits frivolous, saying that it is common practice for SMS providers to confirm the opt-out. It will be up to California courts to opine as to whether marketers can reasonably send one more text message to consumers or whether confirmation needs to be sought through other means, for example e-mail.

In the area of privacy, brand representatives from Charlotte Russe spoke at the Summit and mentioned that they only ask for first name and mobile numbers in mobile sweepstakes. Not only does this facilitate sweepstakes entry for the consumer, it means there is less sensitive date to protect. Charlotte Russe is wisely only asking for data it needs. At the same time, various speakers discussed the need for action by the mobile industry to create ways to opt out of tracking.

Another area of confusion at the GSMI Summit was the role of legal counsel on mobile promotions. Some marketers complained that their General Counsel did not understand the legal issues or just said no to marketing offers. If legal counsel does not understand your mobile marketing strategies, then it is time to turn to outside legal counsel who has expertise in this area. Bring legal counsel into the process early so there is time to examine the intricacies of your promotion’s execution. Your attorney should protect your interests but not stymie your marketing goals.

BEST PRACTICES:

• Construe opt-ins narrowly for specific campaigns.
• Consider other ways to confirm opt-out besides another text message.
• Beef up privacy policies and confirm security procedures.
• Engage specialty legal counsel on your mobile team early in the process.

© Kyle-Beth Hilfer, P.C. 2010. Kyle-Beth Hilfer, Esq. has a law practice that specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP.  For more information about her law practice, please visit www.kbhilferlaw.com.

1- COPYRIGHT MISTAKE:

Photographs on Google Images are not free for the taking. Regardless of whether a photograph bears a copyright or watermark symbol, it is not in the public domain. Someone holds the copyright. It may even be a famous organization like Getty Images. If you use these images, you may receive a cease and desist letter and a claim for financial damages. Always take photographs from stock photo houses or buy rights directly from the photographer. Read the licenses to be sure you understand your rights.

2- TRADEMARK MISTAKE:

Trademark infringement is not based on precise copying. The test for trademark infringement is likelihood of confusion in the marketplace. This means altering one word of a slogan may not ward off a trademark infringement claim if you market in similar trade channels with similar goods. Take the time to create original trademarks.

3- DATA COLLECTION MISTAKE:

If you are collecting any consumer data on your website, in social media, or on mobile devices, you should publicize a privacy policy that explains to consumers where that data goes, how it is shared, and how it is protected. An astounding number of website owners do not protect themselves properly with updated Terms of Use and Privacy Policies. Many who have those policies do not update them annually. Review these policies annually with legal counsel to see if they still align with current business practices.

4- PRIZE PROMOTION MISTAKE:

If you are running a sweepstakes or contest, do not copy rules from another promotion you find on the Internet. Every promotion has its own details that require careful crafting of rules. Each of the 50 states has complex statutes governing prize promotions. There are a variety of contrasting requirements on such issues as rule requirements, disclosures in advertising, prize delivery, and registration and bonding. Using social media platforms for public voting can render the promotion an illegal lottery if not implemented properly. Prize promotions require close legal vetting.

5- MOBILE MARKETING MISTAKE:

An astounding number of marketing companies are trying to break into the fast growing area of mobile marketing. They rely on third party lists of mobile phone numbers, and they have not done proper due diligence. They do not understand the legal requirements of obtaining consumer opt-in before commencing a mobile campaign. Enforcement of federal statutes in this area as well as state attorneys-general investigations are on the rise. The financial ramifications of a failure to obtain a proper opt-in can be staggering. Consult with your legal counsel about the proper way to obtain the opt-in before commencing a mobile campaign.

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP, a full service intellectual property law firm. For more information about her law practice and more blog posts, please visit www.kbhilferlaw.com.

The defendant, Phillip A. Flora, allegedly sent over 5.5 million unsolicited text messages in a forty day period, marketing loan modification, debt relief, and other financial services. Based on responses he received, including those asking not receive any further texts, Flora allegedly developed a list to resell of consumers interested in debt modification. Consumers lost money because of text messaging fees levied by wireless carriers, in spite of the fact that they never chose to receive the text messages, according to the FTC.

Certainly, this particular case was of unique interest to the FTC. Not only were consumers losing money in text messaging fees, these text messages appeared to prey on vulnerable citizens who perhaps were already suffering financial loss due to the mortgage crisis.

The case is still a cautionary tale for even the most benign mobile marketing campaign. It underscores the need for obtaining consumer consent before implementing a mobile marketing campaign. It also outlines some of the statutory requirements for disclosures in mobile text messaging. Mobile marketing is a growing tool for driving traffic to retail locations and delivering a profitable ROI. Marketers need to learn the legalities of such promotions to avoid compliance issues.

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP, a full service intellectual property law firm.  For more information about her law practice and more blog posts, please visit www.kbhilferlaw.com.

The FTC’s revised Guidelines on Testimonials and Endorsements require, in part, prominent disclosure of any material connection between a company and its endorsers. A material connection can be anything from a commission, pre-payment, coupons, or free product samples. The FTC takes the position that consumers have a right to know of any material connection between the endorser and the advertiser. Failure to make such a disclosure constitutes deceptive advertising.

Legacy has agreed to pay $250,000 to settle the FTC’s charges. In addition, they will have to monitor an submit reports about their affiliate marketers. The FTC’s press release can be found here

If your company uses third party endorsers, affiliate marketers, or even employees to promote your products, it is essential that you:
Create a written policy for disclosing the material connection between your company and these endorsers. The FTC’s guidelines require such a policy.
Train all endorsers about how to make proper disclosures. Give examples in different social media. Teach them that a material connection means.
Consider short hand disclosures such as hashtags on Twitter and/or third party options such as CMP.LY’s simple icon system (See: http://cmp.ly)
Monitor and enforce your policy.

Be sure to attend our Social Media Legal Risks and Strategies Summit where Kyle-Beth Hilfer will be running a workshop and presenting.

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP, a full service intellectual property law firm.  For more information about her law practice and more blog posts, please visit www.kbhilferlaw.com.

The number of complaints in this category has almost doubled since 2008. A close look at the report shows that in many states, complaints in this area rank in the top two or three categories. In Minnesota, it was the top complaint category with ten percent of complaints. One has to wonder what is going on in Minnesota!

Reading the FTC report should give sweepstakes promoters pause. The FTC’s statistics suggest that the use of prize promotions as a marketing device is on the rise. At the same time, the rise in complaints suggests that many marketers either are unaware of the morass of governing statutes or they do not care to follow the law.  Ignorance of the law is no defense, however, and intent to ignore the law can lead to stiffer financial and even criminal penalties.

Under the Obama Administration, we are seeing an emboldened, activist FTC at work. State regulators are following suit. Companies that are using prize promotions need to be aware that this is a highly regulated area. They should partner with specialized legal counsel, early in the process, to help structure promotions that pass legal muster.

Prize promotions are uniquely qualified as marketing devices in the social media and mobile marketing arenas. The legal issues require analysis in light of these unique platforms’ capabilities. Does requiring a consumer to like a Facebook page constitute consideration to render a sweepstakes an illegal lottery? Probably not, but requiring multiple Foursquare checkins from various locations might taint a promotion without an alternate method of entry. Can a jingle contest incorporate public judging via Facebook or Twitter? Possibly, but only if chance does not overtake the objective criteria for judging. Can a marketer require text message entry into a sweepstakes? Text messaging has not permeated the marketplace sufficiently to obviate the current need for an alternate method of entry.

Implementing a prize promotion requires thoughtful analysis of the elements of prize, chance, and consideration to be sure that the promotion is not an illegal lottery. In addition, these promotions should be subject to detailed analysis from a legal, business, and public relations perspective to avoid the increasing trend in consumer complaints before the FTC.

A loyalty program is a tried and true marketing device that drives consumer recognition of a brand and interaction with the brand. Many brands offer gift cards or gift certificates to loyal consumers. In so doing, however, the brand subjects itself to the complicated maze of gift card laws.

Most states have gift card/certificate laws that deal with the thorny issues of expiration dates and fees. In addition, the  Credit Card Accountability Responsibility and Disclosure Act of 2009 (the “Credit Card Act”) amends the Electronic Funds Transfer Act to govern electronic store gift cards and certificates. The statute covers such issues as dormancy fees, service fees, and expiration date restrictions. The federal statute carves out an exception for certain types of loyalty, award, or promotional programs that incorporate codes or other devices are not subject to the numerous substantive requirements of the statute.

In structuring a loyalty program, brand managers and marketers should consider strategies that would allow them to avoid gift card/certificate classifications. Consider setting up a program that allows consumers to accumulate points (that have no monetary value) but can be redeemed for merchandise offered via website. An example of such a program is “Disney Movie Rewards.”* These programs are complex to establish, particularly if they have any overlay of sweepstakes, contests, or instant wins or if some of the points can be traded in for gift cards or discounts.

Depending on the loyalty program’s structure, aspects of gift card statutes may still apply. In January, 2011, an individual (Anthony Ferreira) filed a complaint seeking to certify a national class of plaintiffs in a lawsuit against Groupon and its retail partners. At issue is whether certain Groupon “daily deals” for discounts constitute gift certificates. The plaintiff alleges that consumers purchase the deals on a prepaid basis in exchange for specific discounts redeemable by a single merchant, making these deals gift certificates. He complains that expiration dates would then be prohibited under the Credit Card Act. While Groupon settled a similar case in 2010 and revised its Terms and Conditions to bring them in line with gift card statutes’ requirements, this case, if fully litigated, could lead to an expanded definition of “gift certificates” that could impact point loyalty programs.

In addition, with the proliferation of mobile marketing, more loyalty programs are incorporating an instant redemption aspect to point collection. Consumers are able to redeem their loyalty points in store by receiving scannable gift certificates on their mobile devices. As marketers seek to incorporate an instant rewards component into their loyalty programs, they need to be sure to reexamine the legalities of offering gift certificates and compliance with the variety of governing statutes.

The trip to the Emerald City can be plagued by flying monkeys and evil apple trees and deceptively sweet looking poppies. Similarly, the gift certificate statutes appear more straightforward than they really are. They can present a significant obstacle to a marketer’s loyalty program.Engaging legal counsel in the early planning stages will allow the marketing and legal teams to hash out the details of the program cooperatively and clear the way to the riches of the Emerald City.

*”Disney Movie Rewards” is a trademark of Disney, a company that is not affiliated with this blog or the author’s blog.

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. specializes in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP, a full service intellectual property law firm.  For more information about her law practice and more blog posts, please visit www.kbhilferlaw.com.

What’s the takeaway for marketers? In the words of the Bard, “To thine own self be true.” When you develop a brand image, create something original, something lasting, and then stick with it.   Just because new technologies are out there does not mean you should veer off course. Don’t assume “young and hip” will work for your brand. Your marketing message needs to adapt to new technologies, but not completely change in an attempt to capture new audiences.

From a legal perspective, your brand is an asset, worthy of protection. The elements of your brand that are distinctive and original, namely your trademarks or slogans, your trade dress, or your copyrighted images or text, need to be handled with care as you engage with consumers using new marketing platforms. It is easier to secure legal protection with consistent usage and a consistent message.

While your brand’s image is not necessarily protectable according to statutes and case law, your marketing strategies can determine whether you are safeguarding that image or hurting it. In addition, if your marketing plans do not contemplate the legal maze of 50 states’ marketing laws and FTC requirements early in the game, you may end up defending your brand to a regulator, certainly not the best public relations tactic.

In developing a brand strategy, you need to consider how new technologies and platforms can help your customers experience your brand more completely, but stick with the message you have already developed if it is working. By engaging legal counsel early in the brand development process, you can engage in a well-rounded conversation about the legal implications of your marketing strategies and avoidance of legal exposure for your brand. At the same time, your legal advisor can contribute in a creative way to support your marketing goals while maintaining protection for your intellectual property and brand.

Maybe the Oscar promoters needed a marketing lawyer on their team last Sunday night!

© Kyle-Beth Hilfer, P.C. 2011. Kyle-Beth Hilfer, Esq. is an attorney specializing in advertising, marketing, promotions, intellectual property and new media law. She is also Of Counsel to Collen IP.  For more information about her law practice, please visit www.kbhilferlaw.com.