An interesting case, Stacey Mattocks vs. Black Entertainment Television LLC, was recently decided in a Florida, USA court.

The Facts

Woman loves TV show (nothing I've ever heard of). TV show gets cancelled. Woman starts Facebook and Twitter campaign to get TV show back on the air. Facebook page gets 6.2 million "likes", tweets on the Twitter account are also "favourited" by a lot of people. Based partly on this, different TV channel revives and produces (ultimately) three more seasons of TV show.

TV channel also tries to hire woman as social media consultant. Negotiations go well initially, but sour when parties differ on the value of Facebook page (more on this below), and in particular, how much the "likes" are worth. This comes up because part of proposed deal with woman is that TV channel acquires Facebook page.

Relations break down, woman cuts off TV channel's access to Facebook page. TV channel proceeds to get Facebook page and Twitter account disabled, and Facebook "likes" transferred to a new page.

Facebook Inc and Twitter, Inc immediately comply with TV Channel's requests to disable woman's pages and transfer the "likes" to TV channel's new Facebook page, finding this to be in line with their internal terms and conditions.

All hell breaks loose and court case ensues.

The Legal Question

There are/were a number of separate cases involving the same parties, and a number of technical legal questions to be answered.

As much of the content of the Facebook page consisted in intellectual property - namely the TV show itself - that the TV channel had rightly acquired from the predecessor channel, the major question of interest to IP practitioners was: who owns the "likes"? Did the plaintiff, amid her campaign to get a TV programme back on air, own the "likes" her promotional Facebook page had attracted? Or was Facebook correct to transfer the likes to the new Facebook page set up by the TV channel?

The Court's Finding

The court held that the plaintiff had failed to prove she had a proprietary interest in the likes, and ultimately concluded that nobody owns the "likes". They also found that Facebook and Twitter did nothing wrong.
The decision amounts to an implicit finding that Facebook "likes" are not an intangible asset, i.e. something you can own, at least not if you're in Florida.

Analysis

I'm relieved that the court did not find (or even consider) whether Facebook itself owned the "likes". Facebook provides a modality for expressingapproval of a brand, and surely should not own the "likes" of brands using that modality any more than a newspaper should own the positive brand equity gained by a restaurant following a positive review published by the paper. Incidentally, most restaurants today would probably prefer the "likes" to the favourable review in the newspaper nobody is reading, but either way, that the court never went in this direction is one point in its favour.

Other than that, though, the court, while having a good grip on what liking something on Facebook means at a mechanical level, took a very conservative and even shortsighted view of what constitutes intellectual property.

The court rightly pointed out that liking something on the social media service is a rather ephemeral construct, as at any time, you may also "unlike" the thing you liked (very much as you might in real life like something/someone one day, and dislike it/him/her the next).

The fact that something is temporal, though, should not be the decider of whether it constitutes an intangible asset. Most intellectual property is, by its very definition, of limited duration. Patents will last you about 20 years in most places, works of copyright somewhere closer to 50+ years. "Likes" are of course more unpredictable than either of these intangible asset classes; somebody may "like" something on social media and "unlike" it minutes/hours/days later, but while the "like" subsists, is it not an intangible, a crumb of online goodwill of sorts? Is it not a small, electronic manifestation of brand value? I think it is, and if it is an intangible asset, it has value. The fact that the underlying brand was in this instance owned by someone else is, I believe, immaterial to deciding whether it is, in theory at least, an intangible asset, and if so, what it is worth.

Speaking of value, before this matter went to court, relations between the parties broke down mainly because they each came up with such wildly divergent values for the 6.2 million "likes". The plaintiff appraised her Facebook page at $1.2 million, while the defendant took a more conservative view, estimating it to be worth $15,000. Low valuation notwithstanding, that it gave the "likes" any valuation at all is tantamount to an admission that they are an intangible asset.

It's impossible to say how much the "likes" really are worth without further information and detailed analysis, but likely the number falls somewhere between the two, probably skewed closer to the TV channel's guess.

Another point: just because someone can "unlike" you doesn't mean that your "like" wasn't an intangible asset while you had it. Goodwill and reputation are all about ebb and flow; consider: who didn't figuratively "unlike" Toyota, even momentarily, when their cars started killing people for about two years, or IAMS/Eukanuba when its pet food started killing dogs?

Conclusion

Stacey Mattocks, the plaintiff in this case, may well have been deluded about the value of the "likes" she had attracted to her promotional Facebook page. That doesn't mean that the "likes" are not an intangible asset or that they were without value. She put effort and skill into the page and driving page views. When the TV channel started its own page, it started out with zero "likes", as all pages do, which tells you that these nebulous "likes" are not nothing. Yes, there’s the common refrain that it's easy to click "like", but you're still only clicking if you, well, like the thing you’re “liking”. If anything, this is a more concrete and tangible expression of brand loyalty than the definitions of goodwill we’ve been fed to date.

Even if you find Facebook "likes" a fuzzy concept (as I confess I do on some level), the fact is that, for better or worse, we live much of our lives online these days, and interact with brands and express our brand preferences amid these online lives. Our definition and understanding of intellectual property in general, and goodwill in particular, should move in tandem with these changes.

Written by Mark Smith, Director, Ratiodex