Slashdot Mirror
Rewriting a Software Product After Quitting a Job?
hi_caramba_2008 writes "We are a bunch of good friends at a large software company. The product we work on is under-budgeted and over-hyped by the sales drones. The code quality sucks, and management keeps pulling in different direction. Discussing this among ourselves, we talked about leaving the company and rebuilding the code from scratch over a few months. We are not taking any code with us. We are not taking customer lists (we probably will aim at different customers anyway). The code architecture will also be different — hosted vs. stand-alone, different modules and APIs. But at the feature level, we will imitate this product. Can we be sued for IP infringement, theft, or whatever? Are workers allowed to imitate the product they were working on? We know we have to deal with the non-compete clause in our employment contracts, but in our state this clause has been very difficult to enforce. We are more concerned with other IP legal aspects."
You could save the money on a lawyer.
You'll likely get sued regardless of whether they have a case or not. If you have the money to fight it, it will drag on for some time.
If you ever need to raise money, no VC will invest in your company if they know you have a potential legal liability.
Depending on the nature of the software (more likely to happen if its expensive / low volume), your previous company may try to harass your customers too.
It sucks, but its the nature of the game. Unless the current company that you work for isn't willing to do anything quasi-legal to preserve their business.
Disclaimer: I am not a lawyer and this is not legal advice. So, yeah, get a really good lawyer and get some good legal advice before you do anything.
Over the past 10 years, I have served as an expert witness in a number of IP-related software lawsuits, many of which have a fact pattern pretty much identical with what you've laid out.
Yes, they can sue you on (at least) two different grounds: copyright violation and theft of trade secrets.
The case Computer Associates v. Altai established the concept of non-literal copyright infringement of source code. Even if you rewrote the program from scratch in another programming language, the AFC ("abstraction, filtration, comparison") test could be used to find similarities, and your (former) employer could argue copyright infringement, not just on source code grounds, but on architecture, design, database schemata, and data file structure.
Even if you go one step farther and use a "clean room reverse engineering" effort to rewrite the code, you could still be sued (and lose) for theft of trade secrets. Your employer would need to identify those trade secrets, show what steps it took to protect its trade secrets (typically such actions as IP and/or confidentiality agreements, some measures of physical and electronic security, etc.), and argue for the value of those trade secrets. You would have to show that those "trade secrets" can be documented outside of their history at the company you're leaving.
Note that if any one of your group of "good friends" is seen as having a significant position in your large software company, they can also try to come after you for "breach of fiduciary duty".
In any case, they might well name each of you individually as defendants along with whatever new company you set up to develop this software.
In short, there are major risks to what you are describing and not a lot of upside without an explicit release. It can be done, and done successfully, but lawsuits are expensive. ..bruce..
Bruce F. Webster (brucefwebster.com)
Or how about just linking to the article (here) instead of making us jump through hoops?
"If they can't take two blocks of code and say "he stole this" they have nothing"
WRONG.
REPEAT AFTER ME: NEVER TAKE LEGAL ADVICE FROM SLASHDOT; NEVER TAKE LEGAL ADVICE FROM SLASHDOT
There are four problem areas that you might face:
1.) contract law - your non-compete - you will be sued on this as an example to the others
2.) trademark law - (or more accurately, trade dress - look it up on wikipedia) - if you copy the look and feel of their product, expect to be sued
3.) copyright law - this is the area that the quoted poster is referring to - you might be ok on this one, although if they can prove similarity you might be screwed (because you sure had access to the code)- I'm not too familiar with copyright law with respect to computer code.
4.) trade secret law - (again look it up on wikipedia) if they can prove you copied any of their trade secrets with respect to the product you are screwed.
5.) patents - are their any patents on the software? Do you know that there is or isn't?
Also remember that even if they sue you and you win, you are still going to be in line to pay an attorney big bucks. So even if you win, you lose. And given the facts, expect to be sued immediately (I would sue you if I was the employer).
GET A LAWYER IF YOU PLAN ON DOING THIS.... you should not screw around with Slashdot on this one.
GET A LAWYER
GET A LAWYER