A case filed on April 9, 2014 in New York Federal District Court highlights the tension between celebrity endorsements and ordinary First Amendment communications in the digital age. The actress Katherine Heigl, who starred in various middlingly-successful motion pictures, has sued the drugstore chain Duane Reade Inc. for $6 million in damages for tweeting a paparazzi photo of her leaving one of its stores holding Duane Reade shopping bags, with Twitter the tag line: “Love a quick #Duane Reade run? Even @KatieHeigl can’t resist shopping #NYC’s favorite drugstore.”

In her complaint, which alleges deceptive advertising in violation of the federal Lanham Act as well as a New York civil rights statute protecting the use of a person’s likeness, the actress argues that Duane Reade has tried to trick consumers into believing that she has made an endorsement of the company’s brand. The complaint further argues that the image and text has stripped the “story” of any viable news content. To that end, Heigl’s legal team argues that Duane Reade is attempting to obtain what essentially amounts to free advertising at Miss Heigl’s expense – without paying her – by turning her random shopping excursion into an advertisement.

The case raises a number of interesting questions for the advertising industry. It is well-known that the industry has moved to adapt itself quickly to the digital age. For many years now, advertisers and their agencies have moved well past print, radio and video images to which they were formerly limited. For example, it is now common practice for advertisers to run lifestyle blogs that cover topics of general interest but often focus on the latest company news or brand releases cleverly embedded within ordinary content to make it look informal or even off-the-cuff. It is the age of the non-advertisement advertisement. In many cases, readers don’t even know that an entire blog may be a paid “product” that exists solely to advertise a particular brand or item. Often, the blog, twitter feed, or other digital medium is not even connected to the company’s primary “.com” website.
Continue Reading Tweet, Tweet, Sue, Sue: Corporate Twitter Feeds and The Lanham Act

As social media networks become part of the lives and daily routines of more and more people, the use of social media networks in the workplace has begun to highlight a number of issues where an employee’s use of a social media network may interfere with the rights of their employer. A recent case pending before the United States District Court for the Northern District of California presents a familiar problem from the realm of trade secrets, but casts it in a new social media oriented setting. The case is PhoneDog v. Noah Kravitz (N.D., Case No. C11-03474-MEJ).

Noah Kravitz worked for PhoneDog.com where he periodically would offer his opinions concerning new mobile phones as they were released for sale to the public. In order to drive traffic to the PhoneDog website, PhoneDog and Mr. Kravitz employed the use of a Twitter account. Using the Twitter handle of @PhoneDog_noah, Mr. Kravitz was able to attract approximately 17,000 followers, each of whom received real-time updates from Mr. Kravitz regarding his thoughts on various mobile phones, as well as some of his personal opinions on other topics. Upon his departure from PhoneDog.com in October 2010, Mr. Kravitz changed his Twitter handle to @noahkravitz, but continued to use the same Twitter account, effectively taking all 17,000 followers with him when he left. Obviously unhappy with this action, PhoneDog filed a lawsuit against Mr. Kravitz asserting (among other things) a claim for misappropriation of trade secrets. According to PhoneDog’s complaint, Mr. Kravitz’s Twitter account had been developed and maintained for the sole purpose of driving internet traffic to the PhoneDog website, for the sole benefit of PhoneDog. Therefore, according to PhoneDog, Mr. Kravitz’s Twitter account, as well as the password to that account, constitute proprietary, confidential information belonging to PhoneDog. PhoneDog alleged that each of Mr. Kravitz’s 17,000 Twitter followers was worth $2.50 for each month that Mr. Kravitz used the Twitter account after his departure from PhoneDog. Having conjured this $2.50 per user value, PhoneDog alleged that it had suffered $340,000 of damages as a result of Mr. Kravitz’s use of the disputed Twitter account for the eight months following his departure from PhoneDog.

Continue Reading Is Your Twitter Account a Trade Secret?