Social networking has transformed not only how people spend their time, even idle time waiting in the checkout line at the grocery store, but how people interact with one another and share information and content about themselves and others on social media platforms. Social media consumption, especially via mobile devices that facilitate real-time social networking, is where online users spend their time. A recent study according to Pew indicates that, as of December 2012, 67 percent of online adults interact with social networking platforms like Facebook, Pinterest, Instagram, Vine and Twitter.

The study also indicated that in 2011, 52 percent of Facebook users interacted with the platform daily via updates to their status and comments to another’s status. These users are sharing user-generated content via social media, every day. This UGC injected into social networking platforms consists of text content, photos, videos and audio. It also may include trademarks, copyrights and images owned by not only the user but others as well.

Because of the incredible popularity of social networking platforms among consumers, businesses have followed and engage in great efforts to acquire followers of the business’ social media platforms. Businesses hope to encourage interaction with and among their fans. Businesses naturally want to leverage these social interactions, encourage UGC posts to their platforms and integrate UGC with the business’ brand. Social network users love the organic, casual and instantaneous nature of UGC, and hold the opinion that social networking exchanges should be fun, easygoing and unrestrained. Users — both businesses and consumers alike — tend to share and treat UGC freely and casually, mistakenly assuming that UGC posted into social media is within the public domain and available for any use.

From a legal perspective, this viewpoint is dangerous because it ignores the laws of copyright, trademark and privacy, and can subject businesses to significant liability. All the old laws we, as lawyers, concern ourselves with when it comes to rights issues continue to apply in this newer media, with the added layer that all users, including businesses, must comply with each social platform’s terms of use.

A trademark is any word or symbol that identifies products or services of a particular source from those of others. Trademarks can appear on packaging, labels, vouchers or on the product itself. Trademark owners have the exclusive right to use their marks in connection with their goods or services. A copyright, on the other hand, is any original work of authorship fixed in a tangible medium of expression. Copyright owners are entitled to certain exclusive rights under the United States Copyright Act, including the right to make and distribute copies of the work. A copyright includes photos, articles, images and videos. Privacy is a right all people have to be let alone; that is, the right to be anonymous, unnoticed or unidentified in the public realm if one so chooses.

Under applicable federal and state law, unless a "fair use" exception exists, one cannot use another’s trademarks, copyrights or name, image or likeness without their permission. If permission is not secured prior to use, the user, absent a clear "fair use" defense, may be subject to a claim for trademark or copyright infringement. These claims involve significant penalties, including statutory damages, actual damages and attorney fees. When it comes to the Internet, infringement is easy to find and nearly impossible to erase. Likewise, if a release or permission is not secured before use of another’s name, image or likeness, the user may be subject to a whole host of privacy torts, such as public disclosure of private and embarrassing facts (i.e., the dissemination of truthful private information that a reasonable person finds objectionable), false light (i.e., the publication of facts that place a person in a false light, even though the facts themselves may not be defamatory), intrusion of solitude (i.e., the intrusion into one’s private quarters), or misappropriation (i.e., the use of someone else’s name, likeness or other personal attributes without permission for an exploitative purpose).

There is no federal or state law that recognizes an exception to the application of trademark, copyright and privacy laws to the use of UGC derived from social media. Even on Pinterest, a social media site premised on users pinning to pinboards images found online, this is the case. UGC containing the trademarks or logos of third parties requires permission for use. Likewise, UGC itself, plus any copyrights within the UGC, is entitled to copyright protection because users, including under the terms of use of most social media platforms, retain ownership in UGC posted. UGC likely contains some element of creativity that is fixed into a tangible form of media once posted into the given social platform. Accordingly, permission is required for the use of all creative aspects concerning UGC. Moreover, to the extent UGC contains the image or likeness of the user or others, a release granting permission to use not only the user’s image or likeness depicted in a posted photo, as well as others appearing in that photo, must be secured to obviate the risk of a privacy violation.

Furthermore, rights clearance is not only required under the law but pursuant to the terms of use of nearly all social media sites. For instance, Facebook’s statement of rights and responsibilities prohibits users from posting content that "infringes or violates someone else’s rights or otherwise violates the law." The statement also provides that Facebook "can remove any content or information" posted on Facebook if Facebook believes that it violates Facebook’s terms. Similarly, Pinterest’s acceptable use policy prohibits users from posting or pinning content that "infringes any third-party intellectual property rights [i.e., trademarks and copyrights], privacy rights, publicity rights or other personal or proprietary rights." Accordingly, businesses using a consumer’s UGC within or outside a given social media platform without the consumer’s permission can be at risk for serious liability, including under the platform’s terms of use. If the business posts or otherwise uses a consumer’s UGC without permission, particularly outside the platform from which it originated, it could result in the social media site removing the UGC or terminating the business’ account with the site.

Social media platforms safeguard themselves from infringement and privacy claims through "terms of use" that users must agree to when they create an account or use the platform. These terms of use generally provide that: (1) the user retains ownership in UGC posted, (2) by posting UGC the user grants the platform a license to use UGC, including the name, photos, images and likeness of the user and other users to view and share UGC, and (3) the user has all rights or permissions in UGC posted. Social media sites obtain a license from their own users that allows the platforms and their business partners to use UGC within or outside the platforms. These sites also allow for users to view and share another user’s UGC within the platform. Currently, most social media platforms’ terms do not provide that users grant permission to other users to use UGC outside the platforms. Because the copyrights, trademarks and rights of privacy in UGC remain with the owner, any secondary use of UGC requires permission from the user for the use by the business unless a clear "fair use" defense exists under applicable law.

Businesses with a social media presence that seek to use UGC outside the given social media platform from which it originates should consider creating and implementing terms of use disclosed clearly and conspicuously to users in the platform. These terms should inform users that by using the business’ social media platform, like its Facebook page, the user grants permission to the business to use the user’s UGC, including photos, outside the platform and in any form of medium, including the business’ website or other social media platforms. While obtaining such a license does not avoid the need for written permission from the user in all instances, like using UGC in a national, multimedia advertising campaign, it helps mitigate risks to businesses seeking to use UGC outside the platform. These terms of use can also require users to represent and warrant that they have rights in all UGC posted, including any third-party trademarks, copyrights or images included in the UGC, thereby lessening the business’ risk of claims to the extent a third-party trademark owner, for instance, raises an objection.

UGC posted into social networking platforms can be leveraged by businesses to provide a meaningful way to interact with users and communicate information regarding the business’ products and services. Businesses seeking to use UGC need to be aware of risks inherent with such use, particularly for uses outside the platform from where the UGC originated. They should also consider creating and implementing terms of use to govern the business’ social media platforms and closely screen all UGC for potential rights issues before using the UGC.

Kimberly A. Spotts-Kimmel, a partner in the business services group at Gross McGinley, counsels businesses that maintain an online presence in all legal aspects of Internet law. She also works with a wide range of clients, from small businesses and nonprofits to large corporations, on intellectual property, advertising and media law matters.