Contact Us
Phone: 423-205-7744
Location
4416 Brainerd Rd.
Chattanooga, TN 37411
Hours
- Mon - Fri
- -
- Sat - Sun
- Closed
Call Now 24/7 Free Consultation: 423-205-7744
Tennessee & Georgia Bankruptcy: Will the Bankruptcy Court Consider Your Social Media Account an Asset?
You may consider your social media accounts a form of recreation. Your Instagram feed or Facebook page is just a tool for entertainment and communicating with your friends and loved ones, right? However, if you are a business owner or Influencer, and you use social media accounts to advertise or promote your products, services, or brand, they may be considered assets during bankruptcy.
Are Social Media Accounts Considered Assets During Bankruptcy?
In May 2015, a Texas bankruptcy court ruled that social media accounts used to promote a business are considered part of a company’s bankruptcy estate. They also ruled that the business owner may be ordered to surrender their social media account passwords.
Factors to Consider When Determining “Value” of Social Media During Bankruptcy:
Are social media accounts considered an asset during bankruptcy or not? Can the trustee “seize” your social media account when you file bankruptcy? Theoretically, yes, the bankruptcy trustee can seize your social media accounts since there is no rule explicitly preventing a trustee from doing so. However, the bankruptcy trustee isn’t interested in anything unless it holds “value” that could generate funds to distribute to creditors. When considering whether your social media accounts may be considered an asset during bankruptcy, think about these factors.
Do your social media accounts hold value?
Social media accounts have “low barriers to entry,” which means anyone can register a Twitter, Instagram, Facebook, etc. account for free, and it isn’t hard. According to business valuators, this low barrier to entry generally decreases the potential value of the “asset.” Another concept used by professionals to determine the value of assets is “personal goodwill,” which refers to an item (like an Instagram account) having value because of the person who owns the account and posts to the account. If the account were to change ownership, the value would significantly decrease. Many social media account without the original owner would hold minimal value.
Is your social media account used to promote your business?
If your social media account is used to promote your business, it could be seen as a “tool of the trade” and therefore qualify for possible exemption during a personal bankruptcy. There is precedent defining social media accounts used to promote a business as an asset of the company that can be sold in a bankruptcy. If a social media account is a source of income or a source of business, it may have value in the bankruptcy court’s eyes.
Are Your Social Media Accounts Personal or Business?
Most social media accounts are assets, but they are assets the bankruptcy trustee would not be interested in seizing because they have zero value. However, if a social media account is used to promote a business, and the business is sold, the accounts may go with the business. However, personal accounts used for personal use are unlikely to hold value in the bankruptcy court’s eyes. When determining whether your social media accounts are personal or business assets, the court may consider if the accounts: refer to the business, contain links to the business website, advertise the business, are designated as “business” pages or accounts on the social platform, include descriptions or bios about the business. If the court determines that your social media accounts are business assets, they will most likely be treated similarly to customer email lists.
If you are worried about filing bankruptcy because you don’t want to lose control of your social media accounts, we can help. Most bankruptcy offices in the Chattanooga area don’t have a single Consumer Bankruptcy Specialist on staff. Our office is the only one with two. Please get in touch. You are in good hands with Kenneth C. Rannick P.C.
Schedule a Case Evaluation
Contact us now!
Homepage FCE Form
By submitting this form, you agree to be contacted by our law firm, either by phone, text or by email.
Hours
- Mon - Fri
- -
- Sat - Sun
- Closed
Flexible Appointment Scheduling
24/7 Phone Availability
*$0 down to get your Chapter 7 case started applies to clients who choose to file a Chapter 7 bankruptcy with the U.S. Bankruptcy Court through Kenneth C. Rannick, P.C. We will open a Chapter 7 file for a client with as little as $0 down, however, our office will not file a client's Chapter 7 without an affordable down payment on attorney fees.
*$0 down to get your Chapter 13 case started applies to clients who choose to file a Chapter 13 bankruptcy with the U.S. Bankruptcy Court through Kenneth C. Rannick, P.C. Our law office will file a Chapter 13 without requiring any costs or attorney fees paid upfront for qualified clients who 1) have not had a prior chapter 13 dismissed within the past year, and 2) are not trying to stop a foreclosure within 20 days of filling bankruptcy.We are a debt relief agency.
We help people file for bankruptcy relief under the Bankruptcy Code.
The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute an attorney-client relationship.