How 2 legal cases may decide the future of Open Source software (CIO, 6 March 2015) – The days of open source software free lunches are rapidly coming to an end, and that means enterprises that fail to stick to the terms of open source licenses can expect to be sued. That’s the stark warning from Mark Radcliffe, a licensing expert and partner at law firm DLA Piper. “We are entering a different era for open source, shifting from a special universe where people were cooperative and collaborative to a more hard-nosed commercial one,” he explains. “Now people are applying the same criteria for the enforcement of their open source software rights as for proprietary software, and looking at how they can use them strategically in their business.” Radcliffe says this shift is only just beginning, but for evidence he points to the case of Versata v. Ameriprise. In summary, Versata’s proprietary software product, Distribution Channel Management (DCM), used an open source XML parsing utility that was licensed under GPLv2 from a company called XimpleWare. (XimpleWare also offers its utility with a commercial license to companies that don’t want to be subject to an open source license, but Versata did not use that commercial license.) The problem came when Versata licensed its DCM software to financial services company Ameriprise, and subsequently sued Ameriprise for allowing a subcontractor to decompile Versata’s software—a move Versata contended was a breach of license. Ameriprise then countersued. Because Versata’s software included open source software licensed under the GPLv2 and was a derivative work, Ameriprise alleged, the whole of Versata’s DCM product came under the GPLv2 license, and therefore Ameriprise or its subcontractor could decompile and modify the software at will. It turns out that the text of the GPLv2 license, the required copyright notices and a copy of the source code—all of which should normally be included with GPLv2 software—had been stripped out of the open source portion of DCM somewhere along the line, Radcliffe says. It is not clear who did it or why, or whether it was done inadvertently. “The point is that Versata did not appear to have a process for managing open source software. They ignored it, and their contracts were not set up for it,” he says. Radcliffe recommends that companies have an internal process for managing open source software—not just from internal developers, but also from software that comes with acquisitions or from consultants.

 

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A simpler [university] IP process (InsideHigherEd, 25 Feb 2014) – In an attempt to make it easier for researchers to commercialize their work, officials at Cornell University’s New York City campus are reconsidering how they make money off intellectual property. Instead of going through a laborious revenue-sharing negotiation with researchers who believe they have a valuable idea, an institute at Cornell Tech is going to let a set of postdocs keep exclusive license to their IP and take a fixed dollar amount of equity if the researchers create a spinoff company. Officials believe this simple deal will cut through red tape that discourages both inventors and investors from working with academic software developers. The institution’s experiment comes at a time of much debate about how universities take new technologies from collegiate laboratories to the commercial marketplace. The Joan and Irwin Jacobs Technion-Cornell Innovation Institute—a joint nonprofit created by Cornell and Technion, an Israeli-based technology institute, and temporarily housed in Google’s Manhattan office—is modeling its role after that of angel investors, which typically invest up to $200,000 in companies just getting off the ground. The institute is considering postdocs’ salary and time on campus as an angel investment worth $150,000. If the postdoc decides to create a spinoff, that $150,000 would be converted to equity in the resulting startup company—roughly 5 percent for a startup that got a few million dollars in initial funding. But unlike other universities that ask for equity, the institute’s stake would automatically shrink as new investors put in money, said the institute’s director, Adam Shwartz.

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