It is quite hard to imagine that a social media account could be at risk of confiscation during business bankruptcy. Unfortunately, it may be possible in Florida and many other states in the country. If your social media account is tied to the business, your company (or its bankruptcy estate) may try to claim it.
Blurring the line between personal and business affairs
Most business owners use social media to market their products and services. This often blurs the line between personal and business affairs. For example, the former CEO of Vital Pharmaceuticals Inc. used his social media to promote his business and to post his personal content. When he left the company, his social media account became a point of contention in the court, ultimately the company claiming ownership based on a three-step framework.
What is a three-factor test and why should you know about it?
While resolving the dispute over the ownership of a former CEO’s social media account, the U.S. Bankruptcy Court for the Southern District of Florida, came up with a three-step framework to determine the ownership. The framework will evaluate the following:
- How is the account used?
- Who has access to that account?
- Is there a contract that states the ownership of that account?
The court will use these factors to reach a final conclusion.
How can you save your social media account?
In many cases, social media accounts serve a vital role in running a business. As a result, it is common for creditors to become aggressive in claiming them. However, with the help of an experienced legal counselor, you may be able to analyze your situation, review your account and protect your digital identity from corporate liabilities.