August 16, 2018 9:00 am
You’re working on your estate plan with your attorney, and she asks if you’re on Facebook. Don’t be alarmed—she’s not trying to “friend” you. There’s a good reason for her question: your Facebook profile is a “digital asset.” It has personal value to you, and a business profile may also have monetary value.
While the word “asset” conjures images of wealth in the form of physical and financial property, the Internet and social media have created a new form of property that may be transferred upon the death of its owner.
What Are Digital Assets?
Digital assets include your email account; your personal online photos and videos; digital music; personal or business website; Facebook, Twitter, YouTube, Instagram or other social media accounts; Bitcoins or other cyber currency; and any personal content stored in cloud servers and the like.
When your lawyer meets with you to talk about your estate plan, your shared goal is to determine what you own and to whom you want to give it. But too many people overlook the fact that digital platforms are assets that can only be accessed with private passwords. Some of those platforms include years of digital content, most of which we wish to keep private.
So what happens to this digital world when we die? You might think the obvious answer is to give your passwords to your loved ones so they can maintain control of the content. Unfortunately, it’s not that easy. Your loved ones could be violating a platform’s rules or Terms of Service by “unlawfully” accessing the accounts.
The Law Has Not Kept Up
When someone dies, a Personal Representative (PR), formerly called an Executor in Massachusetts, is the person legally responsible for dealing with the decedent’s assets and for distributing those assets to the decedent’s beneficiaries. Unfortunately, the law has not kept up with technology. A PR does not have the power to deal with all of your digital assets.
In the recent Massachusetts case of Ajemian v. Yahoo!, Inc., the PR was denied access to the decedent’s Yahoo email account. Yahoo argued allowing access to the emails would be a violation of the decedent’s privacy rights under federal law. The PR argued the emails were estate assets and therefore under the control of the PR. The Supreme Judicial Court of Massachusetts, the Commonwealth’s highest court, agreed with the PR, but the court noted a major obstacle: While federal law does not preclude a PR from accessing the email, the PR is bound by the company’s Terms of Service.
The recent decision of the Supreme Judicial Court may now provide a sense of relief to companies that manage digital platforms, knowing they will not be in violation of federal privacy laws if they agree to provide access to a PR. However, the current decision does not require such a company to release the information to a PR simply because it is requested. There likely will need to be additional litigation or legislation before PRs can be guaranteed access to such assets.
How to Protect Your Digital Assets After Your Death
For now, we recommend including certain powers in your estate planning documents—such as allowing a PR (or Trustee of your trust) to request access your digital content—as well as other planning techniques to minimize issues concerning your digital assets.
If you own a business, think about the importance of passing down access to digital accounts, such as email accounts, blogs, or social media, to insure the succession of the business. These digital accounts may determine whether or not your business maintains its value after your death and can continue to earn income for your family posthumously.
As for Facebook: It now has a feature that allows you to choose what happens to your account upon your death. You can create a legacy page, for example, and you can designate a “legacy contact”— a person to maintain your account after your death.
We hope that your family will not have to deal with these issues for many years to come, but for those who like to be well prepared, we would be happy to discuss ways to deal with your digital assets today.
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Image Credit: Tim Bennett