As Corporate America wades into the burgeoning world of Internet Web logs, companies are being warned they could face legal hazards when employees are let loose in the free-wheeling blogosphere.

Blogs, online journals that are proliferating on the Web, are attracting attention from big businesses looking for new ways to connect with customers. Sun Microsystems Inc., Microsoft Corp. and General Motors Corp all have officially sanctioned corporate blogs for employees to write about products and strategy.

But lawyers see possible legal pitfalls for companies looking to join the blogging phenomenon. What, for instance, would happen if someone at a publicly traded company unwittingly divulged confidential financial information or a trademark secret on one of these Web diaries?

There already have been cases of people being fired for writing about life inside their companies on blogs not affiliated with their employers. Experts say the real test will come when courts must consider the legal ramifications of what employees say on corporate blogs.

“There’s very, very little case law at this point,” said Paul Arne, co-chairman of the technology group at law firm Morris Manning & Martin LLP. He recently conducted a telephone seminar for other corporate lawyers to discuss blogging.

It’s no surprise that big businesses are increasingly interested in blogs. An estimated 40,000 to 50,000 new blogs are created each day, according to Intelliseek, a technology company that tracks developments in the medium.

At Sun Microsystems, about 2,000 employees blog, including President and Chief Operating Officer Jonathan Schwartz.

Schwartz’s Web columns touch on everything from how businesses can keep customers happy to his brush with national recognition when he was mentioned on the “Late Show with David Letterman” in a list of the “Top 10 Signs Your Kid is Spending Too Much Time on the Internet.”

In a nod to potential legal dangers, Schwartz abandoned attempts at an April Fool’s Day practical joke entry earlier this year, telling readers it would have been difficult to post such a blog without “serious engagement from the corporate legal team.”

Sun was one of the first companies to publish a blogging policy for its employees. Workers are reminded that talking about Sun’s revenue outlook or stock price on company blogs “is apt to get you, or the company, or both, into legal trouble.”

Sun’s bloggers also are cautioned to protect corporate secrets and that “using your Web log to trash or embarrass the company, our customers, or your co-workers, is not only dangerous but stupid.”

By Martha Graybow

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