Brand authenticity is the gold standard for product marketing. These days companies are increasingly relying on social media “influencers” for marketing in an effort to add credibility and authenticity. In 2017, influencer marketing was estimated to be worth $2 billion and it is set to reach $10 billion by 2020.

Influencers may be celebrities, artists, YouTube personalities, or anyone else with a social medial profile and a significant number or niche group of followers. Influencer marketing campaigns typically involve content (picture, video, text, etc.) that is created and posted by the individual influencer, but that pushes a company's advertising message. This can be a product review video on YouTube or an arty Instagram photo of the product, for example. Most importantly, the content in effective influencer marketing campaigns appears to come from an impartial, trusted third-party (the influencer), rather than from the advertisers themselves, thus the authenticity.

While often successful, there are challenges with these campaigns when it comes to intellectual property matters. Influencer marketing can blur the lines between content owner and creator and open up a company to liability for content created by someone else. In addition, the Federal Trade Commission is keeping a watchful eye on influencer marketing and will apply traditional advertising rules and hold companies responsible for violations.

This article discusses some of the IP pitfalls in influencer marketing campaigns and how companies can address those.

1. Who owns the content?

Under traditional copyright law, if the influencer created the content, that likely means the influencer owns the content. That's true even if the influencer was paid to produce the content — unless the social media influencer is an employee or there is a written agreement giving content rights to the business. This makes a written contract with the influencer critical. If there is no contract and the creator (influencer) owns the work, the company could be severely limited in how it can use that work outside of the original post by the creator. Agreements with influencers can vary in style and content, but should try to address the parties' expectations regarding content ownership (assignment vs. license), scope of services, compliance with laws and regulations, and compensation.

Companies should also consider the different types of intellectual property that could be created in the campaign. Typically, influencer content will involve images, video, and/or text, but what if the influencer coins a clever tagline or prepares some design work that could function as a logo? Who owns that IP? These types of works could fall under the purview of trademark law. Unlike copyrights, trademark rights stem from use, rather than creation, but without a clear demarcation of these rights in a written agreement, this could be uncertain.

2. What's in the content?

It is also important for advertisers and influencers to consider third-party rights. The copyrightable works (and trademarks) created by the advertiser or influencer are potentially not the only intangible rights in the work.

Creative influencer content may contain pictures of people, products, locations, and more. All of these could be subject to third-party IP rights. For example, if the content includes images of other individuals, the content could violate the right of publicity or privacy. Many states have granted rights of publicity to individuals through either the common law or by statute. Texas has both, establishing a right of publicity for living individuals through the common law tort of misappropriation of the name or likeness of another, and providing a right of publicity for deceased individuals under chapter 26 of the Texas Property Code.

Similarly, if the content contains other third-party trademarks or copyright-protected works (such as songs or artwork), that content could be infringing third-party IP rights. Further, the “fair use” protections that might apply to personal social media profiles may not go as far in sponsored influencer content, which are likely to be considered commercial messages.

Rights clearances and third-party permissions are critical for influencer content even though influencer campaigns are often more informal and ephemeral than traditional ad campaigns.

3. Where is the content?

If your company has business profiles on social media platforms, then your company has a contractual relationship with the social media platform provider through its terms of service. This is also true for influencers, so it is important to consider the impact the platform terms of service may have on the campaign and whether there are any specific limitations. For example, Twitter includes a license allowing other Twitter users to share any content posted to Twitter, whereas Instagram does not. This means a company can retweet influencer content on Twitter, but it may be more limited when trying to share such content on Instagram (absent a contractual obligation).

4. They said what?

Finally, it is important for influencers and advertisers to consider advertising laws and regulations. The FTC is watching. In the last couple years, the FTC has issued a number of complaints and warnings to companies and celebrities for failure to comply with the FTC Endorsement Guide. The document contains guidelines for complying with fair advertising and consumer protection laws. These include rules for ensuring that any “endorsement” of a product or service is truthful and not misleading, including the clear disclosure of any relationship between the influencer and the product or service endorsed and whether the influencer received any benefit or compensation. Essentially, the FTC is responsible for influencers having to include #Sponsored or #PaidAd in their social campaigns. Accordingly, companies and influencers should address this at the beginning of the relationship and determine what steps will be taken to ensure compliance.

Craig C. Carpenter is an attorney in the Dallas office of Thompson & Knight LLP where he focuses his practice on intellectual property, technology, and data privacy and security law.