Beyond the analysis of social media accounts in the context of a bankruptcy estate, this case offers some important lessons for businesses managing their own social media accounts. Maintaining ownership and practical control of business social media accounts requires an understanding of how social media platforms work and some advance planning.
By Order dated April 3, 2015 (the “Opinion”), Judge Jeff Bohm, Chief Judge for the United States Bankruptcy Court for the Southern District of Texas, disagreed with Mr. Alcede and entered an order 1) ruling that business social media accounts were “property of the [bankruptcy] estate”; 2) concluding that the Social Media Accounts were business accounts and not Alcede’s personal accounts; and 3) directing Alcede to surrender control (i.e. administrative control and password) of the Social Media Accounts to the reorganized debtor.1
The “Personal” Nature of Business Social Media Accounts
As described in detail in the Opinion, the ultimate control of social media accounts rests with an individual. For example, Facebook offers “Pages” for “businesses, brands, and organizations,”2 but each Facebook Page must be created by an individual Facebook user, and administered by one or more such individuals (except in very limited circumstances). Likewise, each Twitter account is created in the name of an individual.
Considerations for Businesses Establishing and Managing Social Media Accounts
Any business establishing and operating social media accounts should at a minimum, take several steps to maintain control over those assets:
As the Tactical Firearms case demonstrates, if social media accounts are worth fighting for, then businesses must make sure to manage those accounts effectively.
1 In re CTLI, LLC, Case No. 14-33564 (Bankr. S.D. Tex. April 3, 2015).
2 Facebook Help Center, Pages Basics, https://www.facebook.com/help/281592001947683/ (Accessed April 26, 2015).