Who Owns Source Code When a Company Folds?

pipeb0mb asks: "A few years ago, I worked for Chilliware, Inc. as the 'Technical Development Manager'. Some of you may remember us for the software iceSculptor, Mohawk and Mentor. Chilliware folded rather quickly and harshly back in May of 2001 due to money issues. Within days of the first layoff, everyone was gone, from the CEO and VP's to the receptionist. Now, years later, I've been digging through some old CDs, and am reminded that I still have the final production source code for the products we released in the retail channel. I've attempted to contact several folks over the past couple of years to gather information about the software and who owns it now. To no avail though. Either I get an 'I don't know' or 'No one' from the dis-interested parties. I feel like these programs are my children that never got a fair shot. I hate to see so much work wasted and lost to the ages. So, Slashdot: What do I do with this source code? It's a great deal of well commented and well written code, performed by over 100 developers in a former Soviet Republic (who formerly worked with Boomerang Software). Where do my binary children go now?" As things are now, if a company folds, the code is buried and forgotten unless someone buys the rights to it, before the source code is lost. This issue was discussed a long time ago and there didn't seem to be much in the way of answers. Have 3 years made any difference?

Comments

Are you this guy?

[Mournblade]

Are you this "Technical Development Manager"?

Interesting (one might say prescient) commentabout Chilliware from Bruce Perens in that discussion.

Cheers!

Immortal Code

[zlite]

In Feb Wired magazine had an article, headlined Immortal Code, about how some software survives the implosions of its company. "The CEO goes to trial. The programmers hit the street. And yet sometimes a piece of code is so elegant, so evolved, that it outlasts everything else." The main example was the DragonSoft speech recognition code, but it also goes into "software repo men".

You have to be kidding

[siskbc]

4. Convince them to assign the rights collectively to the old development team, under an open license. This way, both the old developers and the general public will benefit. That's what any respectable company would do.. (of course, ideally, said company would not have produced proprietary code to begin with and this wouldn't have been an issue)

Right, and then we'll all dance in fairy land and everyone will be happy. I mean seriously, there's no chance in hell that would happen. If the team ever did anything worth a damn with it then the lawyer might have his boss come in and say "Why the hell did you give this away, you are FIRED!"

I mean, that's just not the way this world works. I'm pretty sure parent is a troll (and a good one! ;>), but it does raise a good point, namely the following...

The only chance you would have of open-sourcing this would be for the guy to convince the company to donate it to FSF or some other non-profit. The FSF would then value the code at some ridiculous value, giving the owner a massive tax write-off that is much more valuable than it sitting around collecting dust, and more than the guy could have ever paid for it.

That's the only chance of open-sourcing this stuff.

Prevention?

[4of12]

Sounds grim but true.

So I have to wonder,

Why don't corporations have easy legal means for property disposal after "death", just as Last Wills and Testaments offer individuals a convenient means for avoiding probabe and all those complications?

Is it just that no one thinks their corporation will ever die? Are bankruptcy proceedings so sloppy that they leave any property unassigned?

And, if there is no hope for this particular after the fact problem, or for corporations to put in general legal safeguards for tidy disposal of property without the need for expensive lawyers, then is there some small "sunset" clause that software developers could put in their code to ease the transfer, like a quit-claim that goes into effect if the corporation dissolves and no creditors assert any rights for a period of one year.

IANAL, but, now and then, they're indispensible.

[It's too bad the code author didn't have some claim on the company's assets, such as a paycheck that didn't come. I could see where he could submit a claim as a creditor and negotiate to settle for said source code.]

I've seen this "donation" racket

[siskbc]

The way it really works is more along the lines of: How much did it cost the company or individual doing the donation? In the above example maybe they could write off the amount that was donated- development costs if it was never publicly released and they *paid* development costs.

Not really - it has an intrinsic value that is independent of their actual cost. I've seen a lot of this lately, all involving nonprofits as recipients. MS donates copies of windows to schools, and typically deducts retail price. Another biggie is companies donating patents to universities. Typically the patents are things that didn't work out for them, and got shelved. They donate the stuff to the university in exchange for a "favorable" valuation of the donation, which is typically more than they could have ever sold the patent for.

So, from examples I have actually seen, there is frequently a disconnect between what a donation should be valued at and what's been happening. Supposedly the IRS is going to look more closely at this, but good luck there. This has been a nice loophole for a few years now, as everyone but the government wins. The nonprofit gets something that might be of some value for free, the company gets a big writeoff. The nonprofit doesn't pay taxes, so that's not a consideraton. Nice racket, eh? Some big companies have been doing this too - can't remember exactly, but Big Oil comes to mind, as does Dow Corning.