A range of companies have faced criticism for the way in which they have dealt with negative content posted to social media (for example, you might recall a Twitter campaign backfiring on McDonalds earlier this year, and a memorable response by the proprietors of a US restaurant to criticism directed at them). There can be serious reputational repercussions for organisations that are seen as not properly managing online dialogue with their customers and other stakeholders.
From a legal perspective, the biggest risks for organisations arise from content that third parties post to their social media sites. So far, there is limited guidance from Australian courts about when a company may have legal responsibility for such content. One exception to this is the Federal Court's decision in Australian Competition and Consumer Commission v Allergy Pathway Pty Ltd (No 2) [2011] FCA 74. In this case, Allergy Pathway was found guilty of contempt of court for breaching undertakings it had given to the ACCC not to make or publish representations similar to those which had earlier been found to be misleading or deceptive. The conduct that amounted to contempt of court was the posting to Twitter and Facebook by third parties of testimonials containing such representations. Although Allergy Pathway did not post the content itself, it became aware of the testimonials but failed to remove them, and the court agreed with the ACCC's argument that this was sufficient to render it liable for the content.
A similar position to that adopted by the Federal Court in the Allergy Pathway case was also taken by the Advertising Standards Bureau (ASB) in its decision that content posted to the official Victoria Bitter Facebook page breached the Advertiser Code of Ethics, even though the offending content was posted by users (albeit in response to questions posed by the company) rather than by the company itself.
The importance of the issue of responsibility for third party content is highlighted by the fact that two advertising industry bodies in Australia have recently released guidelines on monitoring social media. The best practice guideline issued in 2012 by the Australian Association of National Advertisers (AANA), the body that develops the Advertiser Code of Ethics applied by the ASB, advocates regular monitoring of social media against the standards in the Code and sets out specific timing for such monitoring to take place.
On the other hand, the guidelines issued in June by the Interactive Advertising Bureau Australia (IAB) take a more robust approach. The IAB states in the guidelines that user comments 'do not constitute advertising' unless they are endorsed by the organisation, and that organisations should not be too conservative in moderating social media as this may 'adversely impact their presence on social platforms'. The IAB does, however, note that there may be a need to remove illegal posts, and recommends that companies follow the recommendations published by the ACCC in relation to avoiding liability for misleading or deceptive content on social media (which are reproduced in the guidelines).
So what should an organisation do about moderating its own social media sites, especially in light of the competing views of these two industry bodies?
We agree with the IAB that a company should tailor its approach to social media monitoring taking into account the areas of risk for the company (both legal and non-legal), and the social media landscape in which it operates, as well as the resources available to monitor social media, rather than attempting to adopt a one-size-fits-all approach. However, in doing so, it is important that the full range of potential risks be considered. These risks include not only the risks of an adverse decision by the ASB or an action for misleading or deceptive conduct (by either the ACCC or a third party, such as a customer or a competitor), but also:
- legal liability for defamatory content if the organisation has published that content and does not have a defence available to it, such as innocent dissemination (see our earlier blog post considering this issue in the context of user generated reviews);
- legal liability for authorising copyright infringement (particularly where the organisation has solicited users to post content such as videos or photographs that may contain third party copyright content used without permission);
- legal liability for offensive material, including under legislation prohibiting racial or religious vilification; and
- other reputational risks from hosting content that may not breach any laws or advertising standards but that may offend customers or other members of the public (and may also breach the rules of Twitter, Facebook or other social media platforms).
It is also important to ensure that the individuals who carry out any such monitoring are aware of the various types of content that may be problematic, including the range of legal issues associated with user generated content, and the ways in which this can be dealt with. Finally, as part of the organisation's preparation for effective social media monitoring, it should ensure that the terms of the organisation's social media sites clearly set out the organisation's expectations about what content may be posted, and what action it may take in relation to content that falls short of the required standards.
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