Facebook, Ferrari in Cahoots Over Fan Pages

     REDWOOD CITY, Calif. (CN) – Aspiring Formula 1 racecar driver Sammy Wasem, of Geneva, Switzerland, says he has loved Ferraris since he was a boy. So it seemed natural that when Facebook rolled out its fan page feature – in the social networking giant’s early days – that he and his father would start one to extol the virtues of the Italian-made muscle cars.
     By 2009, the fan page started by Sammy and his father Olivier had attracted over 500,000 followers. But it also attracted the attention of Ferrari, which lobbied Facebook for administrative control of the page, or so the Wasems claim in a 19-page complaint filed on Tuesday in San Mateo County court.
     The Wasems say that Ferrari employee Claudio Russo contacted them by email in March 2009 to inform them that “legal issues force Ferrari in taking over the formal administration of” the Ferrari fan page.
     “After receiving Russo’s email, the Wasems found, without their permission and without any prior notification from Facebook, Russo had indeed been added as a co-administrator of the Ferrari fan page,” the Wasems say in their complaint. “Plaintiffs are informed and believe and therefore allege that Facebook granted Russo administrative rights to the Ferrari fan page at Ferrari’s request.”
     Russo is not a party to the Wasems’ complaint.
     Sammy and Olivier say that initially Russo promised to collaborate with them on the page, to “preserve the administrators who did so big job [sic].” He even promised them “an active role in” Ferrari’s web development strategy and future Facebook endeavors, according to the complaint.
     Next, Ferrari’s online commerce chief promised the Wasems that their page could become the official Ferrari page on Facebook and, in light of the parties’ new relationship, sent over a contract – which Olivier says he “immediately rejected as one-way because the compensation was very light,” the complaint states.
     Despite the lack of a contract, Sammy and Olivier say that continued working with Ferrari and even allowed the automaker to co-administer their Formula 1 fan page. They continued collaborating on both pages until 2012, although the Wasems say in the complaint that they did “the vast majority of the work updating the page with new content and all the work maintaining the page and moderating improper comments and content.”
     By mid-2012, the Wasems claim that their Ferrari fan page had 9 million fans. An online study released in June of that year put the Italian automaker far ahead of all other car companies in terms of engagement on Facebook, Sammy and Olivier say, adding that their Formula 1 page had also attracted 200,000 fans.
     And then it was all taken away, according to the Wasems’ complaint.
     “On July 31, 2012, without warning, the Wasems received a notice from Facebook that their rights to the Ferrari fan page had been downgraded from co-administrators to ‘content creators,'” the Wasems state in their complaint. “While this still allowed them to post information to the page, they could no longer add or remove other parties as co-administrators. Ferrari now had superior rights to access and control of the Ferrari fan page than the Wasems, who had created the page in the first place and owned it.”
     Attempts to resolve the situation failed, and in February 2013 Sammy and Olivier say they filed a legal challenge in Switzerland.
     Four days later – in apparent retaliation – Ferrari sued the Wasems in Italy, for trademark infringement.
     The company then had Facebook entirely remove Sammy and Olivier from the Ferrari fan page – which had grown to 11 million fans – and then from the Formula 1 page as well, according to the complaint.
     When Sammy lost control of his own personal fan page, the Wasems say they finally appealed to Facebook for help. Their complaint states that Facebook’s lawyers told them that Sammy’s page and the Formula 1 fan page had been hacked and restored administrative control of both back to the Wasems.
     The control over the Formula 1 page was short-lived, however. In April 2013, Ferrari complained to Facebook that the page violated its intellectual property rights and had it shut down, the Wasems say in their complaint.
     And a month later, a new and similar page appeared on the Facebook landscape and in a matter of days had hundreds of thousands of fans – brought there by Facebook, the Wasems claim.
     “Ferrari and Facebook acted in concert and with malice to remove the Wasems as administrators from both pages and to transfer control of the pages to Ferrari, and they did so despite their knowledge of the Wasems’ rights in the pages and with a conscious disregard of their rights and with the intent to injure the Wasems. Plaintiffs are further informed and believe and therefore allege that beginning in or around 2009, Facebook embarked on a series of unilateral changes to the terms of administrative rights to pages in its agreements with users with the knowledge and intent that the changes would allow corporations such as Ferrari to gain administrative rights to pages that they did not create and to eventually gain exclusive control of pages they did not create,” the Wasems state in their complaint.
     Ferrari has earned millions by placing links to its online store directly on the fan pages, Sammy and Olivier claim. They point to an independent study from 2013 that estimated the value of a fan to a branded Facebook page at $174, and at over $1,000 for luxury automobiles.
     The Wasems are suing Ferrari for breaches of contract and fiduciary duty and conversion, and Facebook for aiding and abetting and its own breach of contract. The Wasems are also suing Facebook for using its terms of service to intentionally interfere with their prospective economic advantage.
     Sammy and Olivier seek a declaration that they own the two fan pages, as well as an accounting of the revenue generated from the pages by both Ferrari and Facebook. They also want to be reinstated as the co-administrators of the pages.
     And they want at least half of the revenue generated by the pages and a share of the Facebook’s advertising proceeds, as well as punitive damages.
     The Wasems are represented by James Morando of the firm Farella Braun + Martel in San Francisco.

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