Legal Issue Concerning Website Rights

Hey there,

I have a rather interesting legal issue concerning about the rights to a website.

I am not going to name any names in this so bear with me. I am trying to get some anonymous help concerning the issue.

Person C is a freelance programmer and met Person A (client) through a site called rentacoder.com. They worked with each other for quite some time on several websites so person C trusted person A. They eventually went off rentacoder.com and started working without contracts...

For this new site, no contract was created before work began. Person C was working on this site for $25 dollars / hour. Initially, person A told person C that it was a "small" project so person C stopped working on his personal website that was under development. Person A got wrapped up in college work and so person C ended up communicating with Person A's dad - Person B. Several paychecks were sent to person C as the site progressed.

Towards the end of development, person B stopped coming online and did not communicate with person C for several months. Person C tried emailing both Person B and Person A but got no response. Eventually, Person C found Person B's phone number and ended up calling him. Person B got Person A to get back in touch with Person C.

Person B tried to say that Person C was not authorized to make the latest changes to the website. Person C forwarded emails to Person A from Person B that stated that Person B wanted Person C to add stuff to the site. There was even an email stating that Person B realized he still owed person C money.

Despite all this evidence, Person A stated they were going to pay $1250 of the $2800 and not report income to the IRS even though person C always reports the income. If Person C wanted to pursue it further, they wanted exact dates, times, locations, etc. that Person C worked on the site even though it was never requested for prior parts of the website. They also stated that Person C has rights to all code that was used in the development of the site except for branding.

Because there was no initial contract, what rights do both parties have? I would assume both parties have usage rights and person C maintained selling rights to the software. The way I look at it Person B and Person A pretty much paid Person C for his time invested in creating software. That is like people pay for coders time invested in creating Microsoft software. When they pay for it, they can use the software but can't resell the code.

Let me know if I am right in my assumptions.

Sincerely,
Travis Walters

 

Whiile there might not have been a formal signed contract, I would say that with all of the emails it would still constitute a "verbal" contract and would still be binding. However, if that is true, then person C does not own the code. The reason is that this would be a work for hire. Generally, unless stipulated in the contract, the company (or person) that did the hiring is the owner, not the coder.

They own the code. However, they still owe money. Depending on the state(s) involved, $1600 probably falls under small claims.

 

Person C got a signed letter from Person A and B stating that Person C owns all the rights to the code in the making of the site except for branding.

This is the reason why Person C did not pursue this matter into court. With that signed letter, person C would have the rights correct?

Having said that, person C could use the code to make a very similar website and market it correct and it would be legal?

Sincerely,
Travis Walters

 

Yes, in that case the rights to the code should go to person C. Person C might also justifiably prevent persons A and B from using the code until they have paid in full. If person C just wants to be done with it and sell the code to others without persuing the matter any further, that letter is sufficient to establish the right to distribute for person C.

 

Hello again,

Person C did settle for the $1250. They sent a check that said final payment so that cant be pursued further.

Person C got screwed over money wise but got to keep the rights to the code. At this point, that is what person C cares about because he plans to go into business himself using the code.

Thanks for the legal advise. Props added.

Sincerely,
Travis Walters

 

Yes, the final payment check, if it was cashed, kinda closes that door for him. If he has the signed letter saying he retains the rights to the code, than he can do whatever he wants to it. Sell it with the rights to someone, license it for a payment, or free. License it under the GPL. Anything he wants. Sounds like he got screwed out of half the fees, but hey, at least he retained the rights to the code. If he hasn't cashed the check yet, he can still require them to stop using the software until the rest is paid in full. However, I would be very careful as the employer has every right to demand the dates and times of his work, and a court would require him to show that.

 

Hey there,

Thanks for the response.

Person C will definately keep track of dates and times for future reference if he ever decides to do another website. He decided to use the code to create a business and is forming a partnership with a previous client he did a website for because they worked well togather.

The only bad thing is his website will have a very similar layout to the website he did for Person A and B. He made sure to delete their content and branding and is adding his own.

Sincerely,
Travis Walters