SOCIAL MEDIA PANEL
January 25, 2012
Anaheim, California
Sponsored by: Sheppard Mullin
Moderator:
Cameron Westcott, Legal Counsel, Kia Motors America
Panelists:
Ira Lam, Former Assistant GC, Williams-Sonoma
Brian Anderson, Senior Associate, Sheppard Mullin
Michelle Sherman, Special Counsel, Sheppard Mullin
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Panelists
Cameron Westcott (Moderator)
– Kia Motors America/Legal Counsel
[email protected]
Ira Lam
– Williams-Sonoma/Former Assistant General Counsel
[email protected]
Brian Anderson
– Sheppard Mullin/Senior Associate
[email protected] / Twitter: @BAndersonLaw
Michelle Sherman
– Sheppard Mullin/Special Counsel
[email protected] / Twitter: @MShermanEsq
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FTC Rules For Online Advertising
FTC endorsement guidelines applied to the internet
and social networks
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Transparency in endorsements
No undisclosed relationships
The biased, positive review
The fake, negative review
 Actions a company can take
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FTC Staff Closing Letter To
Hyundai Motor
FTC drafted as guidance to other companies
Take away from November 2011 letter
– Advertiser gift to blogger is material connection
requiring disclosure
– Hyundai spared because it was ignorant of promotion,
and it was contrary to Hyundai’s social media policy
– Social media policy “safe harbor” came into play
– Make sure you share your social media policy with PR
agencies and advertisers, not just employees
– Monitor their activities
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FTC Rule 5(a) And Online Activity
FTC’s settlements with Twitter, Facebook, Google,
and online advertiser ScanScout is part of a larger
enforcement effort
FTC Rule 5(a) prohibits unfair or deceptive acts or
practices
FTC equates violating an online privacy policy with
making a false or misleading misrepresentation
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FTC Rule 5(a) And Online Activity
Actions considered to be a misrepresentation to
consumers
– Not preventing cyberhacking with reasonable security
measures
– Sharing data beyond the audience disclosed to
consumers, including third party advertisers and
applications
– Allowing access to deleted and deactivated accounts
when users were told it would be inaccessible
– Using information beyond the scope of what you told
consumers it would be
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Lessons Learned From Facebook
Settlement
Review and update your online privacy policy and
terms of use
Coordinate changes in website with IT, marketing
and legal so social media use does not outpace
notice to consumers
Use clear and simple language to make
disclosures
Take reasonable measures to safeguard consumer
information
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Protect your IP and Brand!
Business impersonation
Handle squatting
– Reserve your names/handles on various platforms
Violates Terms of Service of many social media
platforms, e.g.:
Twitter:
Impersonation: You may not impersonate others through the Twitter service in a
manner that does or is intended to mislead, confuse, or deceive others
Trademark: We reserve the right to reclaim user names on behalf of businesses or
individuals that hold legal claim or trademark on those user names. Accounts using
business names and/or logos to mislead others will be permanently suspended
Anthony La Russa v. Twitter, Inc. Case
DMCA take-down notices for copyrighted materials
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Contracts with Social Media
Marketing Service Providers
Negotiate covenants, representations
and warranties re compliance with:
– advertising and marketing laws
– your Social Media and Endorsement Policy
 Ann Taylor LOFT, FTC action
– privacy and data security laws
 Indemnification
 Insurance
 Consequential damages
 Review terms of your consumer-facing privacy policy
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Sweepstakes, Contests and
other Promotions
 Ideal for integration with social media
 Basics:
– Lotteries are illegal under federal and state laws
– Three elements: prize, chance and consideration
– Eliminate chance or consideration
– Registration and bonding requirements
– Must have: official rules and advertising disclosures
 What's different from a social media perspective?
– Execution!
– Facebook Promotion Guidelines
– How/where do you implement official rules?
– How do you make sufficient disclosure in 140 characters?
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User-Generated Content
Powerful social media marketing tool:
– personal, authentic, credible and entertaining
Soliciting UGC creates legal risk:
– What rights do you need?
– How do you get rights?
– How can you cover the down side?
– Strategic decision: Do you actively monitor and screen
content or do you rely on DMCA Safe Harbor and CDA
§ 230 Immunity?
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Mobile
 In August 2011, >72.2M people accessed social media
services on a mobile device, up 37% from 2010 (comScore,
October 2011)
 Laws/rules governing social media marketing on mobile:
– TCPA
– Do Not Call
– CAN-SPAM (depending on message functionality)
– State laws
– Industry Self-Regulatory Guidelines (MMA, DMA, CTIA)
– Bottom line: prior express consent & provide opt-out
 Special considerations for mobile-based promotions:
– Text-to-enter promotions
– American Idol/Deal or No Deal Cases
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Location-Based Services
LBS = Social media marketing dream:
– Allows businesses to deliver ads, coupons, promotions,
and information to customers based on the customers
current physical location
– Immediate, personal and relevant connections with
customers at point of sale
Possible new regulations
– Location Privacy Protection Act of 2011 (Sen. Al Franken)
– Geolocational Surveillance and Privacy or GPS Act (Rep.
Jason Chaffetz (R-Utah) and Sen. Ron Wyden (D-Ore.)
– FTC and FCC are also very active in this area now
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8th Annual In-House Counsel Conference
January 11, 2012 (Beverly Hills, CA)
January 25, 2012 (Anaheim, CA)
www.acc.com/chapters/socal/
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