If you’re active on social media — or even if you just pay attention to business news — then you’re likely aware of Elon Musk’s recent Twitter activities. The Tesla CEO has long been viewed as a maverick and visionary, but recent tweets against perceived enemies including a British cave diver, as well as ill-advised public musings about taking his company private, have made it all too apparent that the boy genius’ social media habits are becoming a liability. While Musk is clearly in a class by himself, the public commentary on his activities should raise a corporate law question for all business owners: can your social media posts come back to bite you in the same way?
The issue is one of the most hotly discussed in the business world, with attorneys and corporate law experts agreeing that social media posts can end up being used to great effect in lawsuits. According to Jim Wren, professor of law at Baylor University in Waco, Texas, “Information put out in social media, if relevant, will find its way into the deposing of a witness. It has been happening for quite some time…but is playing an increasing part.”
There have already been notifications issued by the U.S. Securities and Exchange Commission (SEC) in response to tweets issued by such luminaries as Netflix’s CEO, and though no charges were filed the agency did issue a stern warning about how information is managed on social media. Tweets and Facebook posts have frequently been used in litigation to prove or disprove testimony given at deposition or in court.
As a result of the growing trend of business owners’ use of social media, attorneys on both sides of a legal issue are constantly checking to see whether anything that has been posted can be used to strengthen or weaken their case. There is no doubt that the issue would have been central had Tesla’s CEO not chosen to withdraw his statement and reverse his position on the company’s ownership.
With more and more of these Twitter mishaps being publicized, the majority of company executives appear to be studiously avoiding expanding their social media presence with the exception of posting a profile or business-related blogs on LinkedIn. This represents a reversal of previous trends in which business leaders were enthusiastically jumping onboard social media sites. For information on how to protect your business from social media liabilities, contact our office to set up an appointment for a consultation.
