Websites and social media sites such as Facebook and Twitter offer businesses a great way to economically market their services and capabilities, attract and communicate with customers, and transact sales. The use of this media by businesses is rapidly expanding as increasing numbers of consumers use the Internet to research and purchase products and services, and as a result, businesses strive to meet this demand.

While these sites offer many advantages to businesses, they also present potential risks. Business liabilities can arise from false, misleading, or inappropriate information (including photos and videos) being posted in the course of normal business operations and by employees at home on their personal sites.

Here are some examples:

• An amusement park’s website includes photos of riders performing potentially dangerous acts.
• The Facebook page of a consumer product manufacturer allows customers to post photos that show the products being used unsafely.
• A water park advertises, “Safety is our Top Priority.”
• A Go-Kart facility’s website allows customers to post inquiries. When a customer asks if head protection is required, a business representative responds, “We like to live on the wild side.”
• An employee posts a video on their Facebook page that shows a dangerous condition at their place of employment that exposes customers and other workers to injury. The employer is unaware of the hazard.

If one of the above businesses is sued as a result of alleged injuries or property damage, the Internet postings could be used by the plaintiff as evidence in supporting their claim of negligence. Businesses need to be aware of, and effectively manage, the potential risks when they advertise their services, interact with their customers on social media web- sites, or allow employees to comment on business operations or practices via personal or business sites. Businesses hosting sites that allow customers to post photos or comments must review all posts on a daily basis. Any posts that encourage the unsafe use of products or services should be removed or corrected.

Courts have extended litigation discovery rules to include social media postings by businesses and their employees. These postings can and will be used against the business when the content is considered relevant to the litigation. If a business’s website contains information or statements that are not accurate, or are otherwise inconsistent with the business’ official position, those postings may be admissible in court and may compromise the business’s defense position.

Employees’ negative posts on their business product or service, even without business authorization, may expose the employer to potential liability. For example, an employee’s critical post about a coworker may serve as the basis for a lawsuit based on the creation of a hostile work environment.

Moreover, a business’s failure to retain social media postings and other electronic communication when litigation is anticipated may, under certain circumstances, give rise to sanctions against the business for spoliation of evidence.

Social Media Ahead

In today’s litigation, conducting a social media search of target defendants and witnesses is considered part of the minimum level of due diligence expected of a competent litigator. Every business should expect to possibly be subject to this scrutiny, including a close examination of their social media presence on organization-sponsored sites and internal sites and blogs.

Here are some suggestions for best practices in social media management:

1. Start with a risk assessment of your Internet presence, including your main public website portal, Facebook account, and any other social media site you use on a regular basis. Determine if there are any statements containing misleading or false information, or information that is outdated. Examine your website to determine if there are any statements or claims that might prove to be inconsistent with positions taken in litigation. For example, an amusement park should review the photographs on its website to determine if patrons are shown engaging in behaviors that violate venue safety rules.
2. Designate an employee or team of employees to monitor the business’s social media presence and postings by the public. Be prepared to respond quickly and effectively in the event a social media threat is detected.
3. Develop a social media policy for your business and your employees. The policy should anticipate the risks associated with employees accessing social media sites while on your business network, and their personal use of social media sites at home.
4. Update your document retention policies to include all social media activity. Your normal document retention and storage periods should be set forth in writing in order to avoid a claim that the business deliberately destroyed relevant and possibly damaging information. The revisions to your document retention policy should also take into consideration any industry standards, state regulations, and record keeping rules for your industry.
5. Knowing that your social media activity is discoverable in litigation, you must take steps to preserve any and all social media activity when litigation is pending or reasonably anticipated. Consult with your legal counsel to determine what social media activity needs to be preserved.
6. Educate and train your employees in your business social media policy, including giving examples of appropriate and inappropriate social media use. Employees must understand the risks presented by social media use to the organization and to them. Employees must be trained to understand your expectations regarding acceptable Internet use and the critical importance of maintaining customer privacy and the protection of confidential information.
7. Prepare in advance for a social media crisis involving a negative posting or video that goes viral. The time to plan for a crisis is before it occurs, not while you are trying to respond to the crisis and maintain your brand and reputation.
8. Review and understand your insurance coverage regarding advertising and social media postings and work with your insurance agent or broker to obtain the necessary coverage.

By implementing and enforcing a business and social media site policy, your business can mitigate the potential litigation risks associated with these technologies.

This article is intended to serve as a summary of the issues concerning business and social media sites and loss control. While it may include some general guidance and information, it is not intended as, nor is it a substitute for legal advice.