Digital assets and social media profiles: What happens to them on death or disability?

Death and taxes, the only things we can’t avoid in life, right?  There are many who work diligently to avoid taxes, and some are successful, but death is a different story.  At some point in time, we are all going to die.  When we die, or become incapacitated, what happens to all of our digital assets, such as images and documents stored in Dropbox, and posts and images stored in a Facebook, LinkedIn, or Twitter account?  What happens to our online profiles?

Frequently, digital assets have personal and sentimental value, but they can also have economic value.  According to one report in 2011, American consumers valued their digital assets at approximately $55,000.  Also, if someone we love dies or becomes incapacitated, what can we do about their online profiles?  If we have an online presence on social media, it might be a good idea to take down or modify the person’s social media site.  But how does that happen if nobody has legitimate access to the site?

It’s illegal to hack into someone’s computer accounts, and social media sites generally prohibit the sharing of passwords.  The Facebook terms of service prohibit sharing passwords, and letting anyone else access a Facebook account.  The LinkedIn terms of service require users to keep passwords secure and not permit others to use the account.  The Dropbox consumer terms of service encourage users to safeguard passwords, and make sure that others don’t have access to them.  None of these terms of service include the words “death” or “dead.”  So what happens to all of these digital assets and to our online profiles when the grim reaper comes our way?

Recently, Delaware adopted the Uniform Access to Digital Assets Act (UADAA).  The Delaware statute is based on a uniform act that any other state could adopt to address the issues of what happens to someone’s digital assets upon disability or death.

Under the UADAA, fiduciaries appointed by the owner of digital assets may access, control, or copy digital assets and accounts.  A fiduciary in this case is someone appointed to care for the assets or estate of a person who is incapacitated or who has died.  A fiduciary may include a personal representative of a decedent’s estate, conservators of the assets of someone who is disabled, persons granted a power of attorney, and trustees of a trust.  Although the fiduciary may access, control, and copy digital assets, the UADAA doesn’t address the disposition of the assets, and who may sell, transfer, or otherwise dispose of them and to whom.

Other states have addressed access to digital assets in some manner, but Delaware is the only state that has adopted the UADAA.  It is likely that many more states will follow Delaware’s lead.

What does this mean for you today?  It’s time to inventory your digital assets, and start thinking about how to protect them in the event of death or disability.  However, at this point, there are more questions than answers, but it is something to think seriously about.  Some may advocate sharing passwords with a spouse, family member, or close friend, but sharing at this point is a breach of the terms of service of a lot of social media sites.

Hopefully some answers are coming soon, but until then, think about what you store digitally and where, and how you might handle your online social media presence if you are no longer around to manage it.

Protect your brands – It’s time to register trademarks in the trademark clearinghouse

It’s time to start thinking more seriously about protecting your brands and trademarks in the online world.  Businesses expend significant time and resources developing and protecting brands in the physical world, but are not as careful in the online world.  Brands are frequently included in domain names, and are often the dominant part of domain names.  Although domain names may not by themselves communicate a strong message, because they are simply an address for a website, they are the gate through which consumers get to your business, and they directly impact the goodwill of your brand.  

Cybersquatting is as active today as ever, and it is going to get much worse.  Under the old regime of a few top level domain names (the name to the right of the dot, such as .com or .org), cybersquatting was a concern.  But with the introduction of thousands of new generic top level domain names (ngTLDs), the potential for misuse of brands will increase exponentially.

There were 1,930 applications submitted for ngTLDs (prior blog post) in the first round, and of those 1,930 applications, 417 ngTLDs have launched, and almost 1,200 are in the contracting stage, which means they will be available for launch soon.  Some of the ngTLDs that have launched include .homes, .auto, .loans, .global, and .toys.  It is anticipated there will be additional rounds of applications for ngTLDs.

Some of the risks to your brand if you do not protect against cybersquatting include sale of counterfeit goods, phishing, loss of goodwill, and brand tarnishment.  Recently thousands of websites were forced down because they were selling counterfeit Oakley products.  The websites in many cases included the brands of others.  In the complaint filed by Oakley Products, the plaintiff alleged that bogus websites are estimated to receive tens of millions of visits per year and to generate over $135 billion in annual online sales. The U.S. government seized over $1.26 billion in counterfeit goods in 2012, up from $1.11 billion in 2011.  The magnitude of the problem is huge.

Phising occurs when a cybersquatter posts a bogus website using a domain name similar to a brand owner’s trademark, and collects data and personally identifiable confidential information.  Loss of goodwill can occur in many ways including having a variation of a brand or trademark used on multiple websites that are not owned or controlled by you, the brand owner.  Cybersquatters do not only display brands in domain names, but they display the brands on bogus websites.  Tarnishment can occur when a website is posted using a brand, or variation of a brand, and the website displays inappropriate and or provocative images or content inconsistent with the goodwill associated with that brand.

Part of any strategy dealing with cybersquatting should include registering, in the trademark clearinghouse, federally registered trademarks.  I have viewed this as so critical that our law firm has become a trademark agent of the trademark clearinghouse, so we can submit trademarks to the clearinghouse without having to use a third party service.  When a trademark is accepted in the trademark clearinghouse, the brand owner may register domain names under ngTLDs during the sunrise period.  The sunrise period is a period for registration of domain names before the general public can register domain names.

In addition, following the sunrise period, there is a claims period.  During the claims period trademark holders will receive notice of any domain names that are registered under a ngTLD by a third party.  This will provide an opportunity to take appropriate action early in the process.  The person registering the domain name will also receive notice that the domain name being registered is the trademark of another person or business.  Hopefully, this will have some deterrent effect, although that is not likely.

There are other strategies available as well, but for now, the best action to take is to file valuable federally-registered trademarks in the trademark clearinghouse to obtain some protection against cybersquatters under the potentially millions of new domain names under the ngTLD that are increasing weekly.  Although not all brand owners will want or need to take aggressive steps, filing in the trademark clearinghouse should be part of a good domain name management strategy.  Unfortunately, doing nothing and hoping for the best is naïve and will weaken the value of your trademark.