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Posts Tagged ‘#twitter’

Tesla Going Private? Hold the Charge

Posted on: August 31st, 2018

By: Matt Jones

Elon Musk recently tweeted his plan to take Tesla private at $420/share.  He even went so far to say “Funding secured.”  Such a tweet was of course met with a mix of emotions and responses.  Once that news hit the market, Tesla shares soared approximately 11%.  The tweet itself seems harmless on its face; a CEO was simply stating potential plans for his company.  But if you look deeper, there may be potential legal implications.  Specifically, did Musk’s tweet violate any securities regulations, such as regarding fair disclosure?  The regulations prohibit selective disclosure of material information.  But does the information contained in Musk’s tweet equate to material information?  The tweet itself is not likely per se unlawful, but Musk may run into legal troubles if it turns out the funding is not secured, as it may be viewed as misleading the public.

This issue involving dissemination of information via social media is something that will continue to be evaluated and evolve over time.  As different means for providing announcements to the public become more prevalent, the Securities and Exchange Commission will have to continue to adapt its regulations related to disclosure of material information.  Time will tell whether Musk faces legal ramifications for his tweet or if his Twitter account should be deleted altogether to avoid any problems in the future.

If you have any questions or would like more information, please contact Matt Jones at [email protected].

Facebook and Twitter: More Transparency for Political Ads

Posted on: June 4th, 2018

By: Amy Bender

In the wake of the alleged Russian interference with the U.S. presidential election through targeted Facebook ads, both Facebook and Twitter now have imposed conditions for political campaign advertisements. Since there currently are no legal requirements for posting political content on private social media platforms, the platforms have the freedom – and, some say, the responsibility – to create their own policies in order to regulate the content delivered to their users. Facebook and Instagram (which Facebook owns) now require that political ads be labeled with information such as who funded the ad, the campaign budget, the number of viewers, and their demographics. The information also will be stored in a searchable archive. Twitter will require advertisers of political campaigns for federal elections to identify themselves and prove they are located in the U.S. Further, it will not allow foreign nationals to target political ads to U.S. residents. Both platforms have cited increased transparency as the basis for these changes. Facebook also has been under scrutiny since the Cambridge Analytica/user data breach incident, as we reported here.

It remains to be seen if these measures will help regulate political content and if more social media platforms will follow suit.

If you have any questions or would like more information, please contact Amy Bender at [email protected].

“How Much is that Steak Bowl Really?” A Costly Reminder About Social Media Policies

Posted on: March 21st, 2016

By: Robert Krandel

On March 14, 2016, an Administrative Law Judge for the National Labor Relations Board ruled that Chipotle violated the National Labor Relations Act when it unlawfully forced an employee to delete negative tweets about the restaurant. The Chipotle employee, James Kennedy, worked at the Havertown, Pennsylvania Chipotle.  Kennedy posted derogatory tweets about Chipotle’s “cheap labor”. He further tweeted, “crew members only make $8.50hr how much is that steak bowl really?”

In a ruling which is not a surprise to labor law practitioners, the Judge held that Kennedy’s tweets “were protected concerted activity and were for the purpose of mutual aid or protection (of employees).” Importantly, Kennedy’s posts were not part of an employee discussion and he did not consult other employees before tweeting.  Nevertheless, the Judge still found that the tweets “were truly group complaints” protected under Section 7 of the National Labor Relations Act.

Section 7, which has existed in some form or another for almost 70 years (way before tweeting), guarantees employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” as well as the right “to refrain from any or all such activities.”

Employers need to understand how their social media policies might get them in trouble with the Labor Board. For the past 5 years, the Labor Board has used Section 7 to prevent many employers from disciplining employees who make disparaging remarks about the company on Facebook or Twitter.  Even text messages among employees are considered protected under Section 7.  In cases very similar to Chipotle’s case, the Labor Board found the following examples to be protected activity under Section 7:

  • An employee who posts complaints about fellow coworkers on Facebook;
  • Starting a Facebook discussion to complain about a supervisor;
  • An employee criticizing corporate events on his private Facebook account;
  • An employee posting her withholding deductions on Facebook and complaining that the owner was an, “asshole.”

Just like in the Chipotle case, these employers tried to enforce social media policies which violated Section 7. The Labor Board extended Section 7 protection to all of this social media activity in these examples.

Most employers think that Section 7 only applies when the employees are part of a union. Also, most employers think that a strong social media policy can only be a good thing because it helps protect the company’s image.  They are wrong in both cases.  Section 7 applies regardless of whether a union is present in the workplace (Kennedy, for example, was not part of a union while working for Chipotle).  Additionally, a social media policy which is so strong that it prevents routine employee complaints will always violate Section 7.  Consider that in Chipotle’s case, its social media policy contained very narrow provisions designed to protect the company’s image:

  • “If you aren’t careful and don’t use your head, your online activity can also damage Chipotle or spread incomplete, confidential, or inaccurate information.”
  • “You may not make disparaging, false, misleading, harassing or discriminatory statements about or relating to Chipotle, our employees, suppliers, customers, competition, or investors.”

Despite this somewhat benign language, the Administrative Law Judge found that these provisions from the social media policy could be reasonably construed by employees to prohibit their Section 7 rights and that the social media policy was promulgated in response to union activity. The Judge ordered Chipotle to cease enforcement of this policy.

Employers need to understand that social media policies must be carefully crafted.  They cannot be used to stop all employee tweets or Facebook posts.  Employees must be allowed to post discussions about their wages and employment conditions – even when they are not posting as part of a group discussion like Kennedy.  The Labor Board has never condoned outright insubordination and will not consider tweets or posts a violation of Section 7 when the employee is ranting or raving against a supervisor.  But the line is very narrow and as Chipotle found out, it can be an expensive mistake.  Be careful that your social media policy does not cost you more money than you anticipated.