Need Some IP Practice, Scarlatti?

[livius drusus]

I saw you mention in a post somewheres that you might be doing some work in intellectual property law. If you have the time and inclination, I'd really like your opinion of this case:

All Enthusiast, Inc. v. Gunter
Assigned to: Hon. William H. Alsup
Case in other court: Napa County Superior Court, 26-29614
Cause: 28:1441 Petition For Removal--Other Contract
Date Filed: 07/05/2005
Jury Demand: None
Nature of Suit: 190 Contract: Other
Jurisdiction: Diversity

It's all Greek to me, but I know for a fact there was a pdf of the complaint available, but the people who had it hosted at the end of the year have taken it down now.

If you can score the complaint and give it a read, not only would you be working out your IP muscles, but you'll be doing FF a service as well since the defendant Gunter happens to be our programmer and creator of our gallery software, Brian. It is that very same gallery software, in fact, which is the bone of contention here.

[D. Scarlatti]

Thanks. I have the defendant's answer (which contains the complaint), his motion to dismiss, and the court's August, 2005 denial of said motion. I'll have a look.

[livius drusus]

That's excellent, Scarlatti. Thank you very much for doing this.

[D. Scarlatti]

Is All Enthusiast's PhotoPost PHP click-wrap license available for viewing online?

ETA: nm, I found it.

[livius drusus]

Oh cool, because I couldn't find it at all.

[D. Scarlatti]

livius, I don't know what to tell you. The complaint alleges three causes of action: breach of contract, conversion (theft), and unfair competition. The thrust of the allegations appears to be that the defendant purchased a copy of Photopost PHP from the plaintiff and used both literal and non-literal elements* of that program to create his own, vBadvanced Gallery, which the defendant then marketed and sold through his own website.

Prior to filing its suit, the plaintiff apparently had several electronic communications with the defendant, in which the plaintiff expressed some of its proprietary concerns. The plaintiff treated the defendant's replies as acknowledgement of wrongdoing. The defendant denied this and suggested his replies were attempts at resolution or compromise and claimed that, as such, they wouldn't be admissible under Federal Rule of Evidence 408.

That may be good lawyering, but given the content of the replies, the defendant's characterization of them as resolution or compromise raised a red flag for me. A partial text of those communications is reproduced in the defendant's answer to the complaint.

Subsequently, the defendant filed a motion with the federal district court in California seeking to have the suit dismissed, arguing that the California court has no personal jurisdiction over him, a resident of Georgia. That motion was denied, rather soundly, it seems to me.

At this point it's my understanding that All Enthusiast, Inc., the owner of Photopost, has since also become the owner of vBadvanced Gallery. I have an idea what might have transpired in the interim, but it's pure speculation on my part and is only based on my general impressions.

Hope this helps.

* I am assuming this, but this is what the plaintiff would need to have proved had the case gone any further than it did. Very briefly, the literal elements are the source code itself, and the non-literal elements are the structural and other features that obtain from the code.

[livius drusus]

That's immensely helpful, Scarlatti, thank you. Can you tell me what was in the communications that raised red flags for you? Are any complete emails included in the answer or are they quotations?

Thanks again for going through the trouble.

[D. Scarlatti]

It's not so much the contents of the e-mails that raised the red flag, but rather the defendant's invoking FRE 408, which deals with the admissibility of offers, acceptances, or promises of "valuable consideration[s]" during negotiations. For example, if a settlement offer is made during pre-trial negotiations, evidence of that settlement is not admissible at trial.

At any rate, here is the relevant portion from the complaint:

12. When All Enthusiast ascertained information that Gunter/Plurplanet might be engaged in wrongdoing, All Enthusiast promptly raised objections. In response, Gunter acknowledged his wrongdoing. He conceded sharing the Photopost program with another person, in violation of the License. He also made further admissions about vBadvanced Gallery, including as follows: (a) By email dated December 2, 2003, Gunter admitted: "Many parts of the user end still look similar to Photopost since I had been running that before I wrote my own and didn't want to change too much and confuse my users..." (b) By email dated December 3, 2003, Gunter admitted: "Yes some of the variable names are still the same as Photopost's...It was much easier at the time to keep some of the same variable names which I was first writing the script and before I had intentions of reselling it..." (c) In another email from Gunter on December 5, 2003, he likewise admitted: "I was also not concerned if some of the variables were still the same as Photoposts's since I did not have intentions of reselling it at that time."

And the defendant's answer:

The allegations of paragraph 12 are denied as pled. In further response to the allegations of paragraph 12, Defendants state only that Mr. Gunter communicated with Plaintiff in an effort to resolve and/or compromise Plaintiffs allegations of wrongdoing and that such communications are subject to Federal Rule of Evidence 408. Defendants specifically deny any and all allegations of wrongdoing and Defendants deny Plaintiffs characterization of such communications as admissions of any wrongdoing, which is specifically denied.

In my (non-legal) opinion, Rule 408 is an inappropriate mechanism. I may be wrong, but I see no "valuable consideration" in the above exchanges. Obviously a poor argument is not evidence of culpability, but it caught my eye.

[Stephen Maturin]

Originally Posted by D. Scarlatti

In my (non-legal) opinion, Rule 408 is an inappropriate mechanism. I may be wrong, but I see no "valuable consideration" in the above exchanges. Obviously a poor argument is not evidence of culpability, but it caught my eye.

I'm just talking out of my ass here (as usual), but it seems to me that the second sentence of Rule 408 might be entirely appropriate:

Evidence of conduct or statements made in compromise negotiations is likewise not admissible.

The issue then becomes whether the mined quotes set forth in Paragraph 12 of the complaint (assuming, of course, that they're even accurate) were made in the course of "compromise negotiations." There isn't enough information in the quoted portions of the complaint or answer to make that determination.

Originally Posted by D. Scarlatti

At this point it's my understanding that All Enthusiast, Inc., the owner of Photopost, has since also become the owner of vBadvanced Gallery. . . .

. . .

. . . [T]his is what the plaintiff would need to have proved had the case gone any further than it did.

So the case is history? Interesting. Did Gunter give vBadvanced Gallery to All Enthusiast in exchange for a dismissal with prejudice?

[livius drusus]

Fascinating. I can't trust my reactions here because I have a personal preference for one party, but I don't find the quoted comments acknowledgement of wrongdoing. The third one seems to come closest, but from what I've read on the various vB coder forums, making a similar user end and reusing some variables are accepted practice. After all, by that standard most of the different forum software packages out there steal from each other. Perhaps some of our local programmers can speak to the practices described.

The 408 seems like a non-sequitur to me too. I does seem more likely to be a lawyer's idea, though.

ETA: Okay, Maturin, that makes sense too. You fancy lawyer types see everything 50 which ways, doncha?

Originally Posted by Maturin

So the case is history? Interesting. Did Gunter give vBadvanced Gallery to All Enthusiast in exchange for a dismissal with prejudice?

Gunter did give vBAG to PP lock, stock an barrel. Everything from the code to the support forum, including posts, login information and licensing data. I don't know what dimissal with prejudice means exactly , but the case is definitely dismissed.

[D. Scarlatti]

Originally Posted by Stephen Maturin

There isn't enough information in the quoted portions of the complaint or answer to make that determination.

I was hoping you'd drop by. Of course you're absolutely correct there, and it was silly of me not to include that caveat.

[D. Scarlatti]

Originally Posted by livius drusus

I don't know what dimissal with prejudice means exactly ...

Plaintiff is barred from bringing another suit on the same claim(s).

[livius drusus]

Ah. Okay, yes, I think it's pretty safe to say it was dismissed with prejudice.

[fragment]

I can't comment on the legal stuff, and I can't say much about the technical side without looking at code, but I can say that those quoted emails hardly amount to admission of wrongdoing in my opinion.

Variable names and similarity of user interface are not evidence that literal and non-literal elements were stolen - to me that sounds like saying to an archtitect that he/she can't use a set square and a tilting table to design a house with four walls and a roof without violating IP. We're talking about an industry with a lot of accepted best practice in these matters*. I wouldn't be convinced by anything less than large chunks of near-identical code or replication of significant novelty in the application architecture. User interface similarity doesn't cut it at all, such things are easily reverse engineered.

It's possible that the emails are not cited as admission of reuse of variable names and user interfaces, but as admission that the commercial product vBadvanced Gallery was developed as an incremental adaptation of All Enthusiasts' product. I don't buy that either. The emails are perfectly compatible with a development process that started with incremental adaptation, but at some point prior to turning it into a commercial product the Photopost code was ditched altogether and the application rebuilt from scratch. Doing this sort of thing is quite common - it can be both easier and more intellectually satisfying to rebuild from nothing. Part of the art of programming is judging when to adapt and when to start again.


*OK, so best practice isn't always followed very well, there's plenty of messy code and non-intuitive interfaces out there, but the practices are established IMO.

[livius drusus]

Thank you, fragment. Many of the coders who have posted on the subject share your perspective, although nowhere near so articulately. One of them did a side by side comparison of both products and found 0 repeated lines and only one repeated variable ($username).

Oh, and I forgot to mention that a non-disclosure agreement was part of the settlement, so neither parties will talk about the specifics and only one party (AE) is saying anything at all, mainly defending themselves from accusations of being the big guy trying to crush the little guy.

[fragment]

Only one! That's so few as to almost be suspicious. There's only so many names it makes sense to use for, say, a filename variable.

It's trivially easy to globally change variable names anyway, so it's not really an indicator of anything. Seeing how closely code logic in one product follows the other would be the only way to tell if code was stolen.

Personally, I'm a fan of open-source anyway. Programming, at least in my field (web applications) is more like providing a service than generating new intellectual property. The more code is shared, the better we can do our jobs, the better results our clients get, and a reservoir of free code gets developed that can be used for non-profit uses. That's all good.

[livius drusus]

Originally Posted by fragment

Only one! That's so few as to almost be suspicious.

Well, those emails went down in 2003, so I wouldn't be surprised if Brian made a point of changing some variables in later versions.

Originally Posted by fragment

Personally, I'm a fan of open-source anyway. Programming, at least in my field (web applications) is more like providing a service than generating new intellectual property. The more code is shared, the better we can do our jobs, the better results our clients get, and a reservoir of free code gets developed that can be used for non-profit uses. That's all good.

Indeed. vm can speak to this far better than I, but the vB hacking community has a weird mixture of a share-and-share-alike and if-your-hack-has-even-a-tiny-piece-of-mine-you're-a-thief ethos.

[D. Scarlatti]

What's even more ambiguous is this damn FRE 408:

Evidence of conduct or statements made in compromise negotiations is likewise not admissible. This rule does not require the exclusion of any evidence otherwise discoverable merely because it is presented in the course of compromise negotiations.

[Clutch Munny]

Man, lawyers have all the fun.

[livius drusus]

Good lord. How do you distinguish between evidence that is "otherwise discoverable" and evidence that isn't?

[Sock Puppet]

That means, if the information appears only in the compromise negotiations, it can be suppressed. If exactly the same info appears somewhere else in the discovery process, it isn't suppressed just because it also appears in the compromise communications.

[livius drusus]

Oh. Okay. That makes sense, I suppose.

[D. Scarlatti]

Right, but the tricky bit is determining first of all, what does "in compromise negotiations" mean and then which statements were and were not a component of those negotiations. As far as I can tell, not only is there a split among federal circuits on how to go about making those determinations, but even a split within the 9th Circuit, whose law governs the (now dismissed) case here.

One interpretation is that the word ["in"] is purely temporal, i.e., the only question is when the statement was made. This reading is likely to be coupled with an interpretation of compromise negotiations as referring to an event; that is, the court first determines if any compromise negotiations took place, then decides if the statement was made in the course of the negotiations. But "in" can also be interpreted in a functional sense; i.e., was the purpose of the statement to further a compromise? The functional view is likely to be used by courts that have interpreted compromise negotiations to refer to a state of mind rather than an event. Such courts will ask if the speaker was seeking to reach a compromise, then exclude the statement if it was germane to that purpose. 23 Charles A. Wright & Kenneth W. Graham, FEDERAL PRACTICE AND PROCEDURE: EVIDENCE, § 5307, at p. 233 (1980).

Gah.

[viscousmemories]

Originally Posted by D. Scarlatti

But "in" can also be interpreted in a functional sense; i.e., was the purpose of the statement to further a compromise? The functional view is likely to be used by courts that have interpreted compromise negotiations to refer to a state of mind rather than an event.

My first thought was "so it depends on what your definition of 'is' is?" but that's actually a fascinating point.

[Stephen Maturin]

Originally Posted by D. Scarlatti

What's even more ambiguous is this damn FRE 408:

Oh, yeah. The rules advisory committee's notes are useless since that third sentence was added by the Senate after the committee had finished its work.

On an even more unrelated note, who the hell pleads a rule of evidence in response to an averment in a complaint? I read literally hundreds of answers over the years and don't recall ever seeing that (though insurance defense lawyers are known for putting all sorts of squirrely shit in the "affirmative defenses" portion of their answers ).