Slashdot Mirror
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?
In short, contact a lawyer
I can't say that I don't give a fuck. I've just run out of fuck to give.
... "ask a lawyer".
But failing that, try to find the principals of the company, the original owners. They owned the assets of the firm. If they don't want it try to get a "whatever, do what you want with it" from them before you try to sell or publish it.
The man who never alters his opinion is like the stagnant water and breeds Reptiles of the Mind -- William Blake
I do.
I will license it to you for 699 dollars.
I don't need no instructions to know how to rock!!!!
Post it online, wait to get sued.
It's a great deal of well commented and well written code, performed by over 100 developers in a former Soviet Republic ...
Well, we all know that in Soviet Russia, source code owns YOU. So maybe you should ask IT.
Tuus crepidae innexilis sunt.
IANAL
That really depends on the definition of "folds". Some examples from my
experience...
1. Company simply stops operating.
In that case the company itself may still exist (in fact if you go to
the web site of the Secretary of State for your state you may be able
to determine if the company is still "active" in which case someone's
filing simple forms on the company each year). In that case the
company (and by extension the shareholders) own the code.
In this case you might find that the owners, who probably have little
interest in the company, and acquire the rights for a small fee.
2. Company is bought outright by another company
This one's pretty simple, the new company probably bought all the
assets of the old company and that would include the copyright on the
source code.
3. Company's assets a bought but company remains alive
This can happen when a company gets into serious trouble, as happened
with many boom companies, and is effectively worth nothing because
there are no customers. The remaining assets (e.g. physical stuff
and copyrights) sometimes get acquired by another company for a small
fee. This happened to me, and in that case the new company acquired
the assets and got the source code.
4. Company goes bankrupt
If the company owes money to people then all its assets are going to
get valued, and that will include the source code, and who gets them
will probably be in the hands of a court. In this instance see what
happened in the bankruptcy clean up.
In the case of venture backed companies there might be specific
clauses in the investment that state what happens if the company goes
under and the VCs may end up with the code.
John.
The author of a Mac game called Glider worked for a company called Casady & Greene. He seems to believe that since the company went bankrupt, the rights have reverted back to him as the author.
I guess this would hold true so long as they didn't sell or assign the rights elsewhere.
Even then, regardless of the answer, you can still be taken to court and it will be up to a judge.
Flip a coin
heads = SCO
tails = Microsoft
I'd advise that you find out who was in charge of the liquidation of the company, and approach them. They would be in charge of the assets. See if they were sold on. If the liquidator still has possesion of them, offer a modest sum ($100 or something) to buy the rights to it off them. The liquidator will probably just pocket the money anyway.
If someone bought the rights when the company was liquidated, see if the liquidator will tell you who, and approach them.
-- There are three kinds of mathematicians: those who can add and those who can't.
"Where do my binary children go now?"
Either Binary District Elementary or Binary Memorial High School.
When a company goes BK, the creditors own everything and either divide the spoils or it gets liquidated at auction. Most likely someone bought the rights to the software for pennies on the dollar. You will need to check the records at the federal or state BK court where the action was filed. Since there may be service fees involved to search online, you may have to visit the court and search yourself.
I'm not suggesting this is cost-effective, but maybe it would pay to consult with an intellectual property lawyer? It's a cop-out answer, I know. But assets are normally liquidated from dead companies by the last holder of the company. Maybe it's a trivial venture to purchase the rights (via a foundation, new or existing) to the now-deceased company from the former owners? Someone has to still be holding the bag... even a VC.
Amateurs discuss tactics. Professionals discuss logistics.
They didn't sell their code to YellowTab.
YT has a license to use the code until 2005 or something (and that doesn't seem to include the kernel as they havn't announced any of the bugfixes the BeOS community has been longing for).
My advice? There's no way you can just release this without getting an OK (a legal OK) from whomever owns the copyright (this may be the company that auctioned the corp's assets for all you know). If you're the only known holder of this code, you're out of luck. You already posted to /. =) Otherwise you could have just released it to the wild without a peep using Kazaa or Freenet or something like that. Not ideal of course, but it would be better than having it sit on a CD for the next 20 years or whatever the IP laws dictate, and it would have been nearly impossible to trace it back to you, I think.
Tough situation, for sure.
What do I do with this source code? It's a great deal of well commented and well written code
Well written AND well commented? Put it in a museum, dude!
You are of course correct. Again, asking /. for legal advice isn't sound advice. However, I'll tell you what would happen, basically. If you tell that lawyer you have something from this company of value, it should technically belong to the company's creditors - I assume it went out of business for a reason, correct?
What will likely happen is that the lawyers for that company won't be interested in developing the software - but they'll be damned if they'll just give it to you and see you do something with it of value. Likely, they'll tell you to fork over the code and decide to archive it in case anyone wants to screw with it. No one likely will.
There are basically three options you have. The first two certainly involve getting a lawyer.
1. Buy it from them. Problem there is that they will not know how to attach a value on it, so they will pick an arbitrarily high one. Remember, if no deal is struck, they get it back once you admit to having it. They also don't want to get fired when they sell it to you for too little. Not reaching a deal won't get them fired, and burning the code is probably best for them.
2. License it from them. Give them some money up front and a cut of whatever you get. This will cut your upfront costs, but they will likely want a huge cut. However, they won't be as afraid, at least, since they get more money if you do. Nobody looks too bad.
3. Pretend you don't have it, and do a "dirty room" re-write of it. Effectively plagiarize it and assume that anyone else involved with it won't remember, won't notice, etc. Then, if you do anything of value with it, worst case scenario is they sue you, you settle, everyone's happy. Bet you wish you hadn't posted this now, huh?
The problem is that, as the article poster mentions, this is a software dead-end, and it's very hard to revive dead code. The current owners don't want to look like idiots when they get pennies for valuable code that they didn't correctly value. They'd rather bury it, which is your problem now.
Note that this is not to be construed as actual legal advice. You'd have to be an idiot to listen to me, particularly since option 3) is pretty illegal. ;)
-Looking for a job as a materials chemist or multivariat
Are you this "Technical Development Manager"?
Interesting (one might say prescient) commentabout Chilliware from Bruce Perens in that discussion.
Cheers!
You're thinking of another company that siezes to exist. Chilliware has merely ceased to exist.
My next sig will be ready soon, but subscribers can beat the rush
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".
Well, from this line...
"Some of you may remember us for the software iceSculptor, Mohawk and Mentor."
I'd say Troy McClure owns it.
There are 01 kinds of cars in the world. The General Lee, and everything else.
/. is not the place to go for legal advice. A lawyer is. If you listen to /. you're gonna be following the advice of people who are just talking out of their ass and get in trouble.
/.s:
I can see future Ask
I got charged with DUI. What do i do?
I got arrested for murder. How can i get off without having to pay for an expensive defense?
I plan to rob a bank. Any tips?
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.
-Looking for a job as a materials chemist or multivariat
Software sucks. Open Source sucks less.
Actually, there is some benefit to asking for this kind of advice - but not to determine the course of action. Rather, for getting an idea of what's possible before seeing your lawyer.
If I were to get divorced (I'm not even married), I'd be talking to my divorced friends to find out what I can expect on the legal front - not because they're legal experts, but because they have experience dealing with my situation. They might be able to help steer me away from bad advice, or help me know what questions I need to ask.
I definitely wouldn't "ask Slashdot" when I've been caught with 40g of cocaine and a 12 year old prostitute in my car. But it is perfectly germane and sensible to ask a bunch of coders about their experience and advice in a situation dealing with writing software and the legal ownership of that software.
Sounds grim but true.
So I have to wonder,
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.]
"Provided by the management for your protection."
That's a one-way ticket to jail. If he has those disks unknowingly, it's a potential oversight. However, if he 1) finds them, and 2) contacts the rightful owner, he's obligated to return them immediately. I suspect they'll record the conversation, and no judge/jury on earth will go for the old "I lost them" routine. Well, maybe the OJ jury.
Remember, his copy is legal under fair use (backup copies made while employed)
The hell! He doesn't have a license to anything he used as an employee. When he quits (or is fired, or laid off) his rights to use company property ceases. I've seen the fair use law, and it ain't that. If MS fires me, can I do whatever I want with a Windows CVS, like develop it into another product? Uh, no. That isn't fair use.
and the only thing the owners can do is compel him to destroy it. They can't compel him to give the code back - he doesn't have a relationship with them anymore.
Legally they sure as hell can. He has their property. Period. They can't threaten to fire him, but he can go to jail.
-Looking for a job as a materials chemist or multivariat
This comes up all the time, often when someone leaves property behind when they move. You'll need some simple legal advice, but there's a procedure, which involves a police report and the publication of some notices, and if nobody steps forward and claims it, it's yours.
Well, they do, actually. There are preferred creditors, less preferred, and non-preferred. The first are banks, the last something like common-stockholders. There is a VERY well-defined pecking order - basically, the higher ups basically get what they want until the debts are satisfied, and if there's anything left, you go down the chart.
The problem here is this guy's code is like Grandma's shitty costume jewelry - it wasn't worth Grandma putting in the will, and before she died, no one really makes a fuss about it. They likely didn't even notice it when the family divvied up Grandma's grap when she died. But if anyone actually wears Grandma's shitty old necklace to a family reunion, say, then everyone's going to get all pissed asking you how come you got Grandma's necklace. Then, the oldest sister wants it an pulls rank, and a nasty fight ensues. Yay.
Same thing here. Everyone assumes that code is comepletely worthless, and doesn't even want it - that is, until you come along, mention that you have Grandma's necklace from the estate (ie, the source code from this project) that you weren't really entitled to. Now, everyone else ahead of you in the pecking order (ie, the preferred creditors) wants the code, simply because it now might have value. Remember, they don't care if they make money off of it - but if you do, that means they could have, and somebody's ass is grass.
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.
I like that idea - problem is, I don't think it's enforceable unless it is agreed to (probably ahead of time) by every potential lienholder/creditor of the company, down to common stockholders. You could make it boilerplate. The problem is that creditors don't want to give things that might have value away, and would rather just have it "just in case." Most likely, they'll just assert their rights over all software in general, in case something comes up they didn't know about.
-Looking for a job as a materials chemist or multivariat
It is presumed that the coded is gone. As in tossed in the trash, right. So do it.
Here. 33N 38' 8" by 117W 56' 28" in back, on friday 8th of August at 11:00 pm. in a brown paper bag...
Now you have tossed it in the trash. I'll come pick it up and do a back alley GPLing... All for only a pack of Camels and a Mt. Dew.
Contact me for details.
Well the first thing you do is not broadcast to the world that you have all this intellectual property.
:
...
If I had to guess, it goes something like this
1. Company goes belly up.
2. You find source code to a market ready product
3. DON'T BROADCAST TO THE WORLD VIA SLASHDOT THAT YOU HAVE IT.
4. Change it up a little, particularly change the name and some visual aspects of it.
5
6. Profit!
Glonoinha the MebiByte Slayer
1. Offer goose for code and post notice in town square.
2. Wait 30 days
3. If no one claims the code in that time you may keep the code and eat the goose.
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.
-Looking for a job as a materials chemist or multivariat
and it is this: It depends.
I can fantasize all sorts of facts completely consistent with your story that would result in dramatically different answers. It just depends.
It depends on who owned the assets before the financial worries (determining clearance and ownership of any work is not always a trivial matter; who wrote the code, were they contractors or consultants, if contractors, what do the work for hire agreements say, how about other ip, what was it derived from, any third party incorporated codes, etc).
It depends on the structure of the company. Corporation, partnership, llp.
It depends how it shut down. Was it liquidated, with assets distributed? Bankruptcy.
It depends upon the agreements of everybody who worked on the software, and whether there were provisions that dealt with whatever eventualities occurred.
It depends upon the nation and, sometimes, the state in which these events occurred.
It depends.
Only a lawyer can ask the questions, determine all the issues and answer them, if an answer is available.
Anybody who pretends otherwise is lying to you.
So what did you do when you were found with 40g of cocaine and a 12 year old prostitue in your car? My uh friend is in a similiar situation.
salvage (s?l?v?j)Pronunciation Key
n.
1.
a. The rescue of a ship, its crew, or its cargo from fire or
shipwreck.
b. The ship, crew, or cargo so rescued.
c. Compensation given to those who voluntarily aid in
such a rescue.
2.
a. The act of saving imperiled property from loss.
b. The property so saved.
3. Something saved from destruction or waste and put to
further use.
The concept of salvage is a long established part of
maritime law, because it was recognized that there
was no benefit to protecting ownership rights of
property that the rightful "owners" could not secure.
Allowing somebody else to rescue the property would
be a benefit to society as a whole that outweighed the
theoretical loss to the "rightful" property owner.
Some definition of "abandoned" software really needs
to be developed. The only thing that is different about
this type of "shipwreck" is that the losses are less
visible.
Creditors should have first claim, but when they have
no capacity or desire to do anything with the code
then there really should be a mechanism to allow
it to fall into the public domain.
Found this
And this containing contact info (may be out of date)
If Amazon still sells this then someone is connected to the money and that means trouble... So forget droping it in the trash and I don't know you...