Outsourcing Tycoon

**vicster19833pbl** · 09-05-2011, 05:18 AM

Hey All

I was just wondering about some of the legal implications of outsourcing.

Let's say you were working on a website application that was new & different. What is there to stop a company half way accross the world from selling your code to other companies once the project is finished?

Do any of you only work with domestic companies and insist on legaly binding agreements?

Would be grateful for your advice.

Thanks

Vic

**chrishirst** · 09-05-2011, 07:02 AM

It's their code, they can do what they like with it.

YOU have been paid to create it.

**r4ys** · 09-09-2011, 03:57 AM

i think what TS mean is if he employing a freelancer(company) and how to stop the freelancer(hired company) from using/selling/leaking the code?

I assume that what has been discussed in freelancer.com msg are eligible as a court evidence or as an unsigned agreement?

**chrishirst** · 09-09-2011, 01:02 PM

That's what non-disclosure agreements or patents are for.

**StartWaves** · 09:57 AM

As has been said you need to limit this contractually. The important point is to be very clear what you expect. If you tell somebody that it is not to be disclosed they are far less likely to put it online in discussing a bug or to distribute carelessly. Generally the developer is in no position to make commercial use of the software and thoughtless disclosure is more of an issue.

You do need to set clear expectations though. Are you commissioning new code that you will exclusively own the licenses to? Do you want to let them use the same code for other customers? The other problem is to what extent they are customizing existing and found code rather than writing code. Incorporation is often a bigger problem than leaking of the constructed code.

Most developers have minimal respect for copyright and tend to think of their efforts as moving the world forward or contributing to the code base of Earth so some education can be necessary to minimize liability. I have even had to explain why Disney's Pluto can not be incorporated in a graphic design. These problems exist to varying extents in the US or elsewhere though there are differences. More experienced staff will be familiar with the issues.

It may be significantly less practical to take somebody to court elsewhere than in your home country though in general courts in the US are prohibitively expensive to use and it may even be cheaper elsewhere though you will need to work through a local lawyer. In my experience this gets expensive because the foreign lawyer wants to work through your US lawyer so they both end up billing.

The main thing is to be clear about what you want in the hope that this influences the person. You want them to treat your code as proprietary as well as that they do not incorporate code from other people's code bases. For open source code you need to be aware of this as the code that incorporates it will become open source when most licenses are used. If they quote from the beginning on the basis that they are writing new code and kissing it good bye when they give it to you, then they are far more likely to behave that way.

There are in a small number of countries problems where patents can not be reassigned but are retained by the software's author (Particularly some Eastern European states) and in many countries software and process are not patentable. Probably a preferable situation as the whole patent concept (That I invented something genuinely new and all mine) is primarily nonsense but still useful while the legal construct exists. In general though patents are a secondary concern to getting the project completed on time and within budget. Copyright and licensing are more significant and more universal.

Do remember that in general developers are in the business of developing software and are in no position to commercialize it themselves.

**chrishirst** · 09-12-2011, 09:57 AM

Wow! There's more common sense and good advice in that one post than normally gets posted in a whole week.

Especially in this one statement

Quote:

Originally Posted by StartWaves

Do remember that in general developers are in the business of developing software and are in no position to commercialize it themselves.

Remember that! We (the developer community individuals) are not too concerned with making money from what we produce. Sure we would like to be paid for what we create or give life to, but turning a project into a commercial proposition is NOT at the forefront of a developers mind. And trying to promote and sell a product would get in the way of development.

**Shey** · 09-14-2011, 10:24 PM

Hi Vic,

One important point to understand is that the modern freelancing marketplace is a global entity. You can hire or be hired by someone on the opposite side of the world for a project, with the click of a button! This opens up a wide range of possibilities, as well as a whole set of pitfalls. Unless you’re an expert in the areas of International Law, copyright, trademark agreements and much, much more, we suggest taking a simple, but practical approach to project contracts.

If your project is a quick-turnaround job with a small price tag, a formal contract may be more trouble than it’s worth. If that sounds risky, it is.
For more involved projects, where hundreds or thousands of dollars may be at stake, a contract is an absolute must.

Non-Disclosure Agreements or Non-Competitive Agreements are some of the agreements to consider. These and other contracts are available for download from many internet sources. Obtaining a signature from the other party may be difficult and time-consuming, but in most cases, you can ask for a scanned copy of the signed document by email or message board.

Whether you’re buying or selling freelance services, consider how much you stand to lose before starting a project without a contract.

Else, hire an employee if you are an employer. If you are a skilled worker, get yourself employed.
You can read the entire article here.