Archive for the ‘Legal and Regulatory’ Category

New Book Outlining How Bad Online Behavior Can Affect Your Life

Thursday, September 29th, 2011

In a new book entitled lol… OMG! : What Every Student Needs to Know About Reputation Management, Digital Citizenship, and Cyberbullying, Stanford MBA student Matt Ivester explains the dangers of bad online behavior, based on his experience creating and leading a web service entitled JuicyCampus, starting in 2007. The book explains the dangers of bad online behavior, and offers advice to college students who want to enter the adult world with their reputations intact.
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In 2007, Ivester founded JuicyCampus.com and invited students at Duke University to gossip freely and anonymously. When he started it, he thought it would be a fun place for college students, but it soon became, “… this malicious website where students were attacked. It got away from me,” he sid in a recent interview with the Stanford Graduate School of Business. “The posts named names, and they were racist, homophobic, misogynistic, vulgar, sexually explicit, deeply personal,” he wrote in the book’s preface.

JuicyCampus.com spread to 500 campuses, attracted investigations from two state attorneys general, spawned hundreds of complaints from college administrators, students, and parents, and even caught the attention of national broadcaster Katie Couric, who described JuicyCampus as a “malicious cesspool of barbs, disses, and insults.” In February 2009 Ivester shut it down.

Out of that experience, he Ivester realized that reputation management and cyber-bullying are big problems on college campuses, and there are not a lot of resources for college students. So, he wrote the book to raise students’ awareness of (1) how their decisions about posting content online will affect how others see them, and (2) how posting decisions by one student will affect the reputations of others.

The book includes carefully chosen anecdotes about videos, PowerPoints, and emails that were meant to be private, but were seen by millions of people.

Previous generations did not have to worry about their college experiments and mistakes living forever for billions to view, Ivester said. But, now, photographs of unflattering behavior, vicious comments on blogs, and even students choices of which pages to “Like” on Facebook could come back to haunt a student twenty years into the future.

“The book is all about personal responsibility,” he says. He starts from the premise that students are creating their online reputations with every piece of content that they post. Most of them enter college with an established digital trail. “Now it’s time for them to take control of that trail and make sure that they are portraying themselves in a positive light,” he says. Campus life offers many temptations and opportunities to experiment. What goes up online will be taken seriously by many people in the outside world. Prospective dates will do a search on their names. Professors, future employers, neighbors, and parents of the friends of their children — the list of possibilities is long.

The book describes ways students can protect their reputations, from carefully managing their privacy settings to constantly monitoring what appears about them online, in addition to a crash course in free speech and tips to help persuade others — either through friendly or litigious means — to remove unflattering content.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

NLRB Releases Report on Social Media Cases

Monday, August 22nd, 2011

The National Labor Relations Board released a report last week that lists the outcomes of investigations into 14 cases involving the use of social media and employers’ social and general media policies, with the goal of helping practitioners in their development of social media policies.

Outcomes included:

  • Four cases involving employees’ use of Facebook where the NLRB found that employees were engaged in “protected concerted activity” because they were discussing terms and conditions of employment with fellow employees.
  • Five other cases involving Facebook or Twitter posts where the NLRB found that the employee activity was not protected.
  • One case where the NLRB determined that a union engaged in unlawful coercive conduct when it videotaped interviews with employees at a non-union jobsite about their immigration status and posted an edited version on YouTube and the Local Union’s Facebook page.
  • Five cases wherein some provisions of employer’s social media policies was found to be unlawfully overly-broad.
  • One case wherein an employer’s lawful policy restricted its employees’ contact with the media.

I plan to provide actionable details for folks developing policies in the next few days.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

FINRA Proposes New Rules: Pre-Review of Content No Longer Required

Friday, August 12th, 2011

FINRA proposed rule changes to the SEC regarding communications to the public, and the proposed changes simplify rules for financial services firms using social media.
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First, FINRA proposed that firms will not need prior approval of content posted on social sites as long as the site qualifies as an interactive electronic forum.

Second, FINRA proposes to reduce the six categories of communications to three, as follows:

  • Institutional communication: includes all communications that fall within the current guidelines.
  • Retail communication: includes any written (including electronic) communication that is made available to more than 25 retail investors within any 30-day period.
  • Correspondence: includes any written (including electronic) communication that is distributed or made available to 25 or fewer retail investors within any 30-day period.

The proposal eliminates definitions for advertisement, sales literature, institutional sales material, public appearance and independently prepared reprints, and “… communication that currently qualifies as advertisements and sales literature would generally fall under the definition for retail communications.”

Within Retail Communication FINRA proposes a supervisory exemption for:

  1. any retail communication that is posted on an online interactive electronic forum (eg., social networks), and
  2. any retail communication that does not make any financial or investment recommendation or otherwise promote a product or service of the member.

All of this is good news for firms and reps engaging in social media, since organizations will not need to pre-review content posted to social networks like Facebook, LinkedIn and Twitter.

Even so, the following rules still apply:

  1. Firms must still maintain records of the communications at existing levels.
  2. In addition, firms must supervise the content in the same manner as correspondence, which means firms must review the content after it is posted, so conversation monitoring and mining capabilities are still important for firms.
  3. And you still can’t predict performance, imply past performance will recur, or making any exaggerated or unwarranted claim, opinion or forecast. As the NY Times reported, a California broker was suspended and fined $10,000 in July for posting “misrepresentative and unbalanced” messages on Twitter.

While social networking profiles will be classified as a Retail Communication, the proposed changes do not suggest that profile information will be exempt from pre-review requirements, so profiles still need to be reviewed before publishing.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

Tennessee Will Imprison You for Posting Photos That “Cause Emotional Distress”

Friday, June 10th, 2011

Last week, the Governor of Tennessee signed a law that makes it a crime to “… transmit or display an image…” online that is likely to “… frighten, intimidate or cause emotional distress… ” to someone who sees it. Violations can earn offenders nearly a year in jail time or up to $2,500 in fines.
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The “emotionally distressed” individual need not be the intended recipient. Anyone who sees the image is a potential victim. If a court decides that the sender should have known that the image would upset anyone who sees it, the poster could face months in prison and thousands of dollars in fines.

Constitutional scholar Eugene Volokh recently wrote that the law doesn’t require that the picture be of the victim, and the government need not prove that the poster intended the image to be distressing. Volokh believes the bill is, “… pretty clearly unconstitutional.”

Another provision of the legislation lets law enforcement access the contents of your communications on social networking sites simply by offering “… specific and articulable facts…” suggesting that the information sought is “… relevant and material to an ongoing criminal investigation.” No warrant required.

Julian Sanchez — a privacy scholar at the Cato Institute — told Ars Technica that “this is a lower standard than the federal Electronic Communications Privacy Act requires” for unread communications. More importantly, because Tennessee is in the Sixth Circuit, it is bound by that court’s Warshak decision, which held that the Fourth Amendment requires the government to obtain a full search warrant in order to access e-mail communications. “That case dealt with e-mail,” Sanchez said, “but there’s no good reason to think a private message on a social network site is any different.”


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

Social Media Policies Needed More for Managers Than Employees

Tuesday, May 31st, 2011

While nearly every organization has a social media policy today, most social media policies ignore the greatest business risk to their organization from social media: managers. The simple reality is that landmark law suits or sanction brought against employers in the past couple of years have resulted from the actions of a manager, not an employee. For example:
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In each of the above cases, managers broke the law and exposed their employer to significant costs and damage to their brands, in addition to personal prosecution, in some cases.

Too many executives and employers hold false assumptions about their powers over their employees, and every employer should proactively educate their managers about their boundaries as managers. Social media training should be part of basic Manager training, just like sexual harassment, bribery or discrimination content.

While I am not aware of any jurisdictions requiring such training for managers, it is clearly in the interest of any employer to take the lead and educate their managers.

All employers should actively educate their managers about the boundaries.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

NLRB Says Employers Can’t Discipline Employees for Social Posts

Tuesday, February 8th, 2011

According to the National Labor Relations Board, companies can not discipline workers who post criticisms on social-networking sites.

The New York Times reports that the National Labor Relations Board agreed Monday to settle a case with a company that fired an employee after she posted disparaging remarks about a supervisor on her Facebook page from a home computer.

While her employer, American Medical Response, claimed that her statements did not qualify as protected activity, the National Labor Relations Board — for the first time — asserted that companies can not discipline workers who post criticisms on social-networking sites.

According to the NLRB, this employer will:

  • revise its “overly broad rules” to ensure that they do not improperly restrict employees from discussing wages, hours and working conditions with co-workers and others while not at work, and
  • they will not discipline or discharge employees for engaging in such discussions.

This clarification by the NLRB will require a lot of companies to change their social media policies right away.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

Does Your Social Media Policy Cover Listening Ethics?

Tuesday, October 19th, 2010

Does your social media policy tell your employees the boundaries they should stay within when hiring social listening, monitoring or mining vendors? Probably not, but it definitely should.

angel-devilNone of the policies in my database of more than 150 policies, templates and guidelines provide guidance to employees on the ethical use of social listening, harvesting, mining, monitoring, or scraping — which are a few of the terms used to describe the process of gathering and processing online social data. As a result, many employees who buy or manage listening tools and social research services don’t even realize that they could be exposing their company to significant brand risk by using social monitoring or mining services that practice questionable data harvesting and processing techniques.

The simple reality is that no industry standards exist, so the boundaries are probably unclear to your employees. But the Wall Street Journal and Gartner recently began to discuss the risks to your brand, and, as a result, relevant industry organizations such as CASRO formed a task force to define industry standards for ethics in social media research and analysis.

In the mean time, it is important that leaders determine the ethics we wish our teams to uphold, and communicate those ethics across the organization through our policies and guidance to our people.

To begin, my team at Converseon recently published Five Ethics Questions for Your Listening Vendor, and Nathan Giliatt published nine Ethical Standards for Listening Vendors.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

FTC Takes Action Against PR Firm for Deceptive Product Reviews by Employees

Thursday, September 9th, 2010

ftc-logoThanks to Constantin at Converseon (my employer) for pointing me to the recent actions by the FTC against the public relations firm, Reverb Communications, for using employees to post fake positive reviews for their video game clients during November 2008 – May 2009.

According to the FTC, “These postings did not disclose the compensated nature of the relationship between the reviewers and the publishers of the gaming applications.”

From the FTC press release:
Under the proposed settlement order, Reverb Communications, Inc. and its sole owner, Tracie Snitker, are required to remove any previously posted endorsements that misrepresent the authors as independent users or ordinary consumers, and that fail to disclose a connection between Reverb and Snitker and the seller of a product or service. The agreement also bars Reverb and Snitker from misrepresenting that the user or endorser is an independent, ordinary consumer, and from making endorsement or user claims about a product or service unless they disclose any relevant connections that they have with the seller of the product or service.

(I’m a little late publishing this, so you may have already heard.)


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

Disney Insider Trading Raises Questions for Social Media, IT Security and Corporate Counsel

Saturday, June 19th, 2010

The following information is summarized from a conversation on the Martindale-Hubbell Connected network for legal professionals. Thanks to Virgina Henschel, Rob Robinson, Mike Mintz and Steven Weinberger for their contributions and insights.

On May 26 of this year, the SEC filed a complaint against an administrative assistant at The Walt Disney Company and her boyfriend, who sent numerous hedge funds anonymous letters offering to provide the funds with inside information about Disney’s quarterly earnings in exchange for a fee. They were busted by the FBI when they sold the information to an undercover FBI agent posing as an investment manager.

When the administrative assistant thought she was going to get away with her crime, she posted the following status update on her Facebook account:

I go shopping, shopping, shopping.

As a result, the defendant’s Facebook status is being used against her by the SEC, to prove a mindset and motivation to do the crime.

In the wake of the case, corporate counselors on the Martindale-Hubbell Connected online network have debated the lessons for companies, which I’ll summarize below for those folks who are not members of that community:

  1. The biggest lesson should be held for corporate IT, not social media managers. Specifically, distribution, access and printability of pre-release earnings data should be more secure than it apparently was at Disney.
  2. There is no way that Disney could have inferred the defendant’s criminal intent from her Facebook update. Even so, all companies need to monitor social media to ensure that they react appropriately to conversations in social media that impact their brand or their organization.

Because the defendant seemed primarily motivated to get money for a Stella McCartney handbag and shoes from Nieman Marcus, some have debated whether this crime impacts the brands of Stella McCartney or Nieman Marcus. That seems unlikely to me.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.

We Will Pay for Privacy – Part II

Sunday, June 13th, 2010

I recently wrote a post entitled “We Will Pay for Privacy“, wherein I predicted that, in the next few years, some high-value consumer segments will begin to understand what is happening to their personal data on the web, and they will stop using ad-supported services for private activities such as email and photo sharing. Instead, these consumers will pay modest fees for such services, in exchange for privacy. New service providers will guarantee their customer’s privacy: they will not display behaviorally-targeted ads on their site, and they will not sell or support re-targeting cookies, for example. Instead, they will simply charge a reasonable fee in exchange for a reasonable service. And consumers who can afford it will do so.

Of course, a few people responded by saying that not enough such consumers exist. I disagree, and here is one more point of evidence that the tide is starting to turn:

Take a look at Tim Bourquin’s site MemberCon, where Tim encourages people to produce content and charge for it. (Crazy, I know.) He is fighting a tremendous battle to convince people that all content need not be free (as in free beer). In fact, he charges hundreds of dollars for his own content, and he is slowly gathering a following.

For additional examples, see my previous post.


Chris BoudreauxChris Boudreaux leads social media strategy and measurement efforts for large B2C and B2B brands. Follow Chris on Twitter, or email Chris to continue the conversation.