In a precedent-setting decision, the United States Court of Appeals for the Second Circuit has provided a landmark ruling on the ownership of social media accounts in JLM Couture, Inc. v. Gutman. This is the first time a federal appellate court has addressed the issue of social media account ownership, a critical question in the modern era of influencer marketing and digital branding.

The case arose between JLM Couture, a bridalwear company, and Hayley Paige Gutman, a well-known designer who managed social media accounts during her employment with JLM. After her departure, JLM claimed ownership of the accounts, asserting they were integral to its marketing strategy. A lower court initially sided with JLM, applying a subjective six-factor test to determine ownership, but the Second Circuit rejected this test.

The appellate court ruled that social media accounts should be treated like any other form of property. The key question is who owned the accounts at the time of their creation. If Gutman created the accounts using her personal information for her own purposes, she retained ownership—even if JLM later used them for business purposes. The court also clarified that merely transferring rights to some content posted on the accounts does not mean the accounts themselves were transferred.

This decision underscores the importance of clearly defining social media ownership in employment contracts. As social media continues to play an integral role in corporate branding, cases like this will likely become more common. The ruling provides a framework for determining ownership by applying traditional property law principles, offering a clearer legal path for resolving disputes over digital assets.

For businesses and influencers alike, this ruling emphasizes the need for careful contract drafting and a mutual understanding of how social media accounts will be used and owned throughout employment relationships.