Court Decides LinkedIn Ownership Case and Finds for Plaintiff But Refuses to Show Her the Money
The infamous LinkedIn ownership case, Eagle v. Edcomm, is over, and for the plaintiff, Dr. Linda Eagle, it was a win and a loss. We told you about this case in the post: "In the Social Media Battle Over Who Owns a LinkedIn Account, the Greatest Threat is State Law Claims – How Employers Can Protect Themselves in Light of Eagle v. Morgan as 11 State Law Claims Proceed to Trial." The case did go to trial, and the Eastern District of Pennsylvania decided that while Dr. Eagle proved three claims against her former employer, Edcomm, she was not entitled to any monetary damages because she failed to prove any damages with reasonable certainty.
Get Caught Up to Speed – A Look at the Case Up to Trial
Here is how it all shook out prior to trial. Dr. Eagle founded Edcomm, Inc., and created a LinkedIn page that she used to promote herself and Edcomm. Dr. Eagle's former co-worker, who was named as an individual defendant in the lawsuit, assisted her in maintaining the account and, as a result, knew Dr. Eagle's LinkedIn password. After Edcomm was later sold and Dr. Eagle terminated, the new owners changed Dr. Eagle's LinkedIn password, removed her name and picture from the LinkedIn profile page, and represented that Dr. Eagle had resigned from the company. Essentially Edcomm pulled a bait and switch; it took the bulk of Dr. Eagle's LinkedIn profile and replaced it with its interim CEO's information while Dr. Eagle's "honors and awards" section and custom URL remained, i.e., Edcomm's interim CEO's profile was accessible "via linkedin.com/in/lindaeagle." What would happen for people searching for "Linda Eagle" on LinkedIn is that they would be directed to Dr. Eagle's LinkedIn profile that contained Edcomm's new CEO's information.
Dr. Eagle sued her former employer for illegally taking control of and accessing her LinkedIn account in violation of the Computer Fraud and Abuse Act ("CFAA"); the Lanham Act (which prohibits a number of activities, including trademark infringement, trademark dilution, and false advertising) in connection with the company's unauthorized use of Dr. Eagle's LinkedIn account; unauthorized use of her name in violation of the Pennsylvania Constitution; invasion of privacy and misappropriation of identity; misappropriation of publicity; identity theft; conversion; tortious interference with a contract, i.e., the LinkedIn User Agreement; civil conspiracy; and aiding and abetting.
Edcomm countersued Dr. Eagle arguing that Dr. Eagle's LinkedIn connections belonged to the company and that Dr. Eagle stole the connections. Edcomm also claimed that Dr. Eagle subsequently reaped the benefit of the time and efforts it put into maintaining Dr. Eagle's LinkedIn account.
Early on at the motion to dismiss stage, the court threw out Edcomm's trade secret misappropriation claim because the information sought to be protected was generally known in the wider business community or capable of being easily derived from public information. The court found that LinkedIn connections are not trade secrets because they are generally known in the wider business community or are capable of being easily derived from public information.
At the summary judgment stage, the court threw out Dr. Eagle's CFAA and Lanham Act claims, which left eight of Dr. Eagle's state law claims and Edcomm's counterclaims that proceeded to trial.
Dr. Eagle's Claims Against Edcomm
1. Unauthorized Use of Name in Violation of 42 Pa.C.S. § 8316
On Dr. Eagle's unauthorized use of name claim, Dr. Eagle argued that Edcomm violated 42 Pa.C.S. § 8316, which provides, "[a]ny natural person whose name or likeness has commercial value and is used for any commercial or advertising purpose" without written consent may recover damages. The court held that Dr. Eagle's name has commercial value, given her wide acclaim, e.g., she had invested time and effort in developing her reputation and was an authority in the area having authored publications, been quoted in others and presented at conferences. The court found that Edcomm "used" Dr. Eagle's name, derived commercial benefit from using Dr. Eagle's name to promote its business and, therefore, found for Dr. Eagle.
2. Invasion of Privacy by Misappropriation of Identity
Dr. Eagle's second claim was for invasion of privacy by misappropriation by identity. To be liable Dr. Eagle had to prove that Edcomm "appropriated to [its] own use or benefit the reputation, prestige, social or commercial standing, public interest or other values of plaintiff's name or likeness." Edcomm argued that it did not attempt to use Dr. Eagle's likeness and credentials during the two-week period it had control of Dr. Eagle's LinkedIn account. The court found this argument disregarded Edcomm's actions in using Dr. Eagle's name to initially direct users to the page. In finding in Dr. Eagle's favor, the court found that Dr. Eagle had a privacy interest in her picture, resume, and name, and while the page contained Edcomm's interim CEO's information, the URL clearly contained Dr. Eagle's.
3. Misappropriation of Publicity
Dr. Eagle also charged Edcomm with misappropriation of publicity, another common law cause of action Pennsylvania recognizes. "A defendant violates a plaintiff's right of publicity by 'appropriating its valuable name or likeness, without authorization, [and using] it to defendant's commercial advantage.'" This right grants a person an exclusive entitlement to control the commercial value of her name or likeness and to prevent others from exploiting it without permission. The court noted the difference between this tort and the tort of invasion of privacy by appropriation of name or likeness: "[T]he right of publicity protects against commercial loss caused by appropriation of a name or likeness. In other words, the invasion of privacy by appropriation of name or likeness is a personal right created to protect one's privacy, while the right of publicity more closely resembles a property right created to protect commercial value."
The court used the facts supporting its conclusion in favor of Dr. Eagle on her first two claims to also find that Edcomm misappropriated publicity. In other words, by using Dr. Eagle's password to enter the LinkedIn account, changing the password to keep Dr. Eagle out and altering the content on the account to reflect Edcomm's interim CEO's information, Edcomm deprived Dr. Eagle of the commercial benefit of her name.
4. Identify Theft
Dr. Eagle was not successful on her claim for identity theft against Edcomm. Dr. Eagle alleged that Edcomm committed the crime of identity theft, and was entitled to civil damages under 42 Pa.C.S. § 8315. Under Pennsylvania law: "A person commits the offense of identity theft of another person if he possesses or uses, through any means, identifying information of another person without the consent of that other person to further any unlawful purpose." 18 Pa. Cons. Stat. § 4120(a).
In refusing to find for Dr. Eagle on this claim, the court noted that unlike her previous causes of action, identity theft requires some unlawful possession of a person's identifying information. It found there was no such "identifying information." Here, Dr. Eagle's name was publicly available and not unlawfully possessed. The LinkedIn account contained Edcomm's interim CEO's name, photograph, profile summary, experience, and education and only Dr. Eagle's "honors and awards," which the court found did not constitute "identifying information" to establish Dr. Eagle's identity because no reasonable individual would doubt that the page belonged to the interim CEO and was describing her, even with Dr. Eagle's "honors and awards" noted.
5. Conversion
Dr. Eagle next argued that Edcomm hijacked her LinkedIn account and committed conversion. Under Pennsylvania law, "Conversion is a tort by which the defendant deprives the plaintiff of his right to a chattel or interferes with the plaintiff's use or possession of a chattel without the plaintiff's consent and without lawful justification." The court noted that conversion is more limited when it comes to intangible property and will be extended to intangibles that are "customarily merged in, or identified with, a particular document (for example, a deed or a stock certificate)." Since the only item allegedly converted was a LinkedIn account, which is an intangible right to access a specific page on a computer, it was not a convertible intangible under Pennsylvania law and the court found for Edcomm.
6. Tortious Interference with Contract
On Dr. Eagle's next claim for tortious interference with her contract with LinkedIn, the court found for Dr. Eagle on the first three elements. The tort requires a plaintiff to prove (1) the existence of a contractual relation; (2) the defendant's purpose or intent to harm the plaintiff by preventing the relation from occurring; (3) the absence of any privilege or justification on the part of the defendant; and (4) damages resulting from the defendant's conduct. The court found that by entering Dr. Eagle's account and changing her password, Edcomm acted with purpose or intent to harm Dr. Eagle by preventing her contractual relationship with LinkedIn. Edcomm argued it had a privilege to enter Dr. Eagle's account under its policy that it "owned" its employees' LinkedIn accounts and could "mine" them for information upon departure of those employees. One problem for Edcomm on this argument … it did not have any such policy. The next problem, the court noted that the LinkedIn User Agreement provides that it is the individual user who owns the account. It is notable that this finding misconstrues the relevant language in the User Agreement, which actually seeks to provide additional liability on an individual who uses LinkedIn on behalf of a company rather than provide a clear designation of ownership as the court's opinion suggests: "If you are using LinkedIn on behalf of a company or other legal entity, you are nevertheless individually bound by this Agreement even if your company has a separate agreement with us." Nevertheless, Dr. Eagle's critical problem on this claim was that she failed prove the forth element of damages, though the court held its discussion on the issue.
7. Civil Conspiracy
In her seventh claim, Dr. Eagle alleged that the defendants conspired to gain unauthorized access to and misappropriate her LinkedIn account. To prove civil conspiracy, Dr. Eagle had to demonstrate: "(1) a combination of two or more persons acting with a common purpose to do an unlawful act or to do an lawful act by unlawful means or for an unlawful purpose; (2) an overt act done in pursuance of the common purpose; and (3) actual legal damage." The court found that Dr. Eagle did not succeed on this claim because she had failed to put forth any evidence regarding any of the individual Defendants. Since employees/directors/shareholders cannot legally conspire under the intra-corporate conspiracy doctrine, under Pennsylvania law, Dr. Eagle's claim failed.
8. Civil Aiding and Abetting
To prevail on her eighth claim for civil aiding and abetting, Dr. Eagle had to prove "(1) that an independent wrong exist; (2) that the aider or abettor know of that wrong's existence and (3) that substantial assistance be given in effecting that wrong." The court denied her claim finding that while she established the existence of an independent wrong—i.e., misappropriation of publicity, invasion of privacy, and unauthorized use of name—she failed to put forth as to any of the individual defendants.
Edcomm's Counterclaims Against Dr. Eagle for Misappropriation of an Idea and Unfair Competition Fail
To counter, Edcomm argued that Dr. Eagle committed misappropriation when she continued to use her account. The tort of misappropriation of an idea has two elements: (1) the plaintiff had an idea that was novel and concrete and (2) the idea was misappropriated by the defendant. Edcomm argued that it decided to use LinkedIn as an indispensable sales and marketing tool and initiated a process by which its management would approve the content of Edcomm employee's LinkedIn account and thus, invested substantial time and effort into its employees' LinkedIn account and their development of contacts on those accounts. Edcomm argued that Dr. Eagle's act of taking back her account constituted misappropriation of an idea. The court disagreed because Edcomm never had a policy of requiring its employees to use LinkedIn, did not dictate the precise contents of an employee's LinkedIn account, and did not pay for its employees' LinkedIn accounts. The court cited again to the LinkedIn User Agreement, which provides that LinkedIn accounts are between LinkedIn and the individual user. Lastly, the court noted that Edcomm failed prove that Dr. Eagle's contacts list was developed and built through the investment of Edcomm time and money as opposed to Dr. Eagle's own time, money, and extensive past experience.
The court also denied Edcomm's unfair competition claim in which Edcomm claims that Dr. Eagle improperly misappropriated the content and connections of the LinkedIn account and improperly used the content to compete with Edcomm. Because Edcomm rested its unfair competition claim on its failed misappropriation claim, the court found in favor of Dr. Eagle.
Now For the Blow. Dr. Eagle Succeeded On Three Claims Against Edcomm! Announcer, Tell Her What She's Won!
In prefacing the damages issue, the federal court described its ruling as a "mixed bag," and here is why. While it held that Dr. Eagle successfully proved three claims against Edcomm for unauthorized use of name, invasion of privacy by misappropriation of identity, and misappropriation of identity when it took over her LinkedIn account for two weeks, changed Dr. Eagle's password locking her out of her account, and posted her successor's information in place of hers, it also found that Dr. Eagle failed to put forth sufficient evidence of compensatory damages.
Earlier in the case, Dr. Eagle had claimed she lost $100,000 in lost business opportunities because she was unable to access her LinkedIn messages, spent money to regain access to her account, suffered damage to her reputation, and that the account lost value due to the disruption.
At trial, Dr. Eagle attempted to prove her damages through the testimony of Edcomm's former CEO and her current business partner and he tried calculate the damages caused Dr. Eagle's loss of access to her messages through her LinkedIn account, which amounted to two-weeks of complete loss and three-month partial loss. According to his testimony, Dr. Eagle had 4,000 LinkedIn contacts, which she had sold business. Using information from Dr. Eagle's lowest sales year, he valued each contact for the two-week period at $62, which equated with a total loss of $248,000, at a minimum. Using an average sales year calculation, he testified that Dr. Eagle's loss was $500,000.
The court found this evidence legally insufficient to establish damages to a reasonable certainty. First, the only evidence she produced was her own self-serving testimony that she regularly maintained business through LinkedIn, and Dr. Eagle did not point to a single contract, client, prospect or deal she lost because of her lack of access. The court went on to note that even if she had showed a "fair probability" of damage, she did not provide a reasonable fair basis for calculating her damages as her evidence was limited to non-expert testimony of Edcomm's former CEO, who testified without referring to any documentation. So, while the court found Edcomm liable on three claims, it awarded $0 in compensatory damages, and went on to award $0 in punitive damages because there was insufficient evidence that Edcomm acted with malice or reckless indifference.
The hard part about coming up with takeways from this case is paring them down.
First and foremost, if you proceed with personality and publicity right lawsuit be able to demonstrate you have suffered an actual, compensable, monetary loss, or while you may win the "principle" portion of the lawsuit, you will lose the "show me the money" part.
Second, while social media cases are interesting and a new frontier in law, it seems difficult to fit them into federal law claims (remember how Dr. Eagle's CFAA and Lanham Act claims did not survive summary judgment), trade secret claims (the information is on social media and publicly available after all), and be better suited for state court lawsuits. Employers beware, these personality and publicity right lawsuits appear to be the type of viable claims plaintiffs can assert in this area. Be sure to review the law in the states you operate to make sure that you are aware of these types of claims so you can take proper action to guard against any lawsuits.
Third, before you make an argument, ensure you can back it up. Here, Edcomm argued its social media policy provided that Edcomm owned its employees' LinkedIn accounts, but there was never such a policy. Had Edcomm actually had such a policy, the results on those claims where it came into play may have come out differently, and also its counterclaims. Speaking of policies, if you are a company that has employees market your company through social media, have the relationship set forth in a contract that clearly provides that the company owns the account, that the employee agrees to relinquish the account upon separation of employment, and that the employee agrees that the company shall have all access information at all times.
Sara Hutchins Jodka
Tags: Eagle, Eagle v. Morgan, LinkedIn, Morgan, v, workplace privacy
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