Community Update

Don’t Let Your Covenants and Restrictions Expire, Be Sure to Preserve

By: Elizabeth A. Lanham-Patrie

The Marketable Record Title Act (“MRTA”) is set forth in Chapter 712, Florida Statutes, and provides that interests in real property are extinguished after thirty (30) years, with limited exceptions, unless preserved through compliance with Chapter 712. MRTA generally does not affect condominium associations and co-op associations (except in limited situations), but it does apply to the covenants and restrictions for most homeowners’ associations.

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The Fair Housing Act: Housing for Older Persons

By: Jennifer L. Biletnikoff

In a recent CUP article, we examined whether 55+ communities can avoid compliance with federal laws that prohibit discrimination based on age and familial status. But what happens when someone under the age of 55 tries to purchase a unit in one of these condominiums? Can they be disqualified from buying solely because of their age? In this featured video, “The Fair Housing Act: Housing for Older Persons,” Jennifer Biletnikoff highlights the crucial distinction between ownership and occupancy in 55+ communities.

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Retaking the Right to Enforce: Explaining the Chattel Shipping Process

By: Michelle H. Kaiser

Generally speaking, an Association may lose its right to enforce its Governing/Condominium Documents if it does so inconsistently, unevenly, or arbitrarily. This is a concept known as “selective enforcement” and is shown when there are instances of similar violations, of which the board had notice but failed to act. When “selective enforcement” is demonstrated, the Association is said to be “estopped” from enforcing the given restriction.

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In re Vital Pharmaceutical
652 B.R. 392 (2023)

By: Joseph Markovich

THIS CASE marks a pivotal advancement in social media ownership jurisprudence by creating a structured analytical framework to determine who rightfully owns social media accounts, particularly when ownership is contested. Complications arise when accounts are created in one person’s name but for the benefit of an entity, or when accounts are managed by employees on behalf of employers. In these scenarios, courts look beyond the act of account creation to determine the intended owner.

The case involves Vital Pharmaceuticals, Inc. (“Vital”), a Chapter 11 debtor, which filed an adversary complaint against its former CEO, John H. “Jack” Owoc, and his wife, Megan E. Owoc, who was the former Senior Vice President of Marketing. Vital sought a declaration that the rights to three social media accounts created by the Owocs while employed by the company were property of the bankruptcy estate and requested turnover of these accounts. The social media accounts in question were used to market Vital’s products and included the company’s brand name in their handles.

The court established a new test focusing on three factors: documented property interest, control over access, and use of the accounts:

• The legal test for ownership of social media accounts begins with the application of traditional property ownership principles, such as a contract between the parties. When such documentation exists, it creates a presumption of ownership that guides the court’s analysis. The court cites several examples, including a social media platform’s terms of service, employment agreements, and social media policies.
• If a documented property interest exists, the presumption of ownership can be overcome by showing that a different party has exclusive control over access to the social media account. This factor examines which party maintained actual control over the account, including login credentials and management authority.
• If neither a documented property interest nor exclusive control over access is established, then the court must consider the actual use of the account. This final factor examines how the account was actually employed – whether primarily for business purposes or personal use.

The court found that neither party could establish a documented property interest or exclusive control over access to the accounts. However, the evidence showed that the accounts were pervasively used to market Vital’s products, with nearly seventy-five (75%) percent of the posts being explicit or implicit marketing for Vital’s energy drinks. The court concluded that the pervasive use of the accounts for marketing Vital’s products, along with other factors, meant that Vital owned the rights to the accounts. The court granted summary judgment by separate order in favor of Vital, declaring that the rights to the social media accounts were property of the bankruptcy estate and ordering the Owocs to turn over the accounts to Vital.

Ownership and control of neighborhood social media accounts created for community associations will likely depend on similar factors, including who created the account, the purpose of the account, and whether it is officially recognized or governed by the association. If the account is created by the association or its board members in their official capacity, it will likely be considered an asset of the association and subject to its governance. However, if a resident creates the account independently and without authorization, ownership and control may rest with the individual creator, unless the association can establish a legal claim to the account based on its use or representation. In such cases, the association may need to take legal action to address any misrepresentation or misuse.

Perhaps the most actionable takeaway from THIS CASE is the emphasis on documented property interests as a factor in determining ownership. While the case does not explicitly address website ownership, the principles and factors considered by the court – such as control, purpose of use, and the documented property interest – could potentially be used to resolve disputes over website ownership. The applicability of these principles would depend on the specific facts and circumstances, as well as any relevant contractual or legal documentation. The court’s framework suggests that entities, including community associations, should implement clear contractual provisions regarding social media account and website ownership to reduce the likelihood of disputes and protect increasingly valuable digital assets.