Social Media has become a vital marketing tool for organisations using it to promote their businesses and communicate with existing and potential customers. Increasingly, our personal lives intermingle with our business lives and social media accounts now hold personal and business data and contact information which, in the past, would have been held separately and privately.
When an employee leaves a business, the question of data ownership is often raised. Does the account, or data held on such accounts, belong to the individual or the organisation? This question was considered in the case of Whitmar Publications Ltd v Gamage and others.
In this case three employees resigned from Whitmar to set up their own competing business. Whitmar accused the employees of making use of a Linked-In group, established and managed by one of them whilst employed by Whitmar, to obtain email addresses for the purposes of soliciting clients and (in particular) issuing a press release for their new business. Whitmar sought control of the Linked In group and asked for disclosure of user names, passwords and other access details, but the former-employees refused to provide these.
Whitmar subsequently sought an interim ‘springboard’ injunction from the High Court to prevent the former-employees from working in the new business and requiring them to hand over exclusive access, management and control of the Linked In group to Whitmar.
Amongst other arguments, Whitmar contended that the Linked In group was established by one of the former-employees on Whitmar’s behalf and was managed using Whitmar’s systems, that it contained confidential client information proprietary to Whitmar and that the former employees were unlawfully using that information to gain unfair advantage. None of the employees were subject to any express contractual restrictions on dealing with Whitmar’s clients post-termination.
The court made a preliminary assessment of the evidence before it and accepted that Whitmar had a very strong chance of showing (at trial) that the data concerned constituted a confidential company database. Accordingly, it granted the injunction requested, and effectively required the former-employees to hand over control of the Linked In group.
Although this was an interim application, rather than a final decision (and the matter was settled before reaching full trial), it demonstrates the extent to which the courts are prepared to afford protection to employers in this area.
However, Whitmar would have enjoyed an easier ride overall had it ensured that covenants were in place within the employees’ contracts. Employees should be under an express obligation to release passwords and other login details on termination of employment and relevant data should be clearly specified as Confidential Information. Investment in social media marketing is easily exploited, if not properly protected.
For advice on implementing social media policies and effective covenants in your employee contracts, get in touch with our Employment Team.