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The difference between subcontracting and embezzlement is the closeness of the relationship. If I receive public funds with the goal to advance public educatio

The difference between subcontracting and embezzlement is the closeness of the relationship. If I receive public funds with the goal to advance public education and I use it to set up public schools, that is a valid pursuit of that goal. If I receive those same funds and use them as grants for private schools meeting specific goals, that can also be a valid pursuit of the goal. But I choose to direct those funds to private schools, and I sit on the board of some of those private schools, then that makes a strong case for it being embezzlement. Where the close relationship comes from may differ. It may even be from trying to avoid conflicts of interest (e.g. an agency whose policy forbids holding assets, and therefore has been the sole funding of a nominally independent production company). Requiring publicly funded would to enter the public domain would be a way to prevent this entire class of misdeeds.

KerrAvon 4y ago
This is a fine position to advocate for, but it’s not the way the licensing worked here.
s1artibartfast 4y ago
I don't think closeness or relationship really has anything to do with it. A much simpler definition is if all the stakeholders were aware and consenting of the contract, and did you deliver on your obligations. Are you insinuating that the producers of Sesame Street failed to deliver or tricked those purchasing the broadcast license
- Retric 4y ago
  I am proposing that public TV has overpayed for Sesame Street. It can be illegal when a nonprofit does that when paying rent on a building, but it is more difficult to value IP transactions. Sesame Workshop did nothing wrong, public TV did by agreeing to such a contract at the beginning of their relationship.
  - s1artibartfast 4y ago
    Why do you think public TV overpaid? If they didn't like the terms they could always not renew the license, and ultimately I guess they did. Similar arrangements are quite common in the startup world were you invent something novel. You then make a second company with a license for a specific purpose and sell the second company with the license and retain the core IP. There's nothing fraudulent about it as long as the buyers know they're getting a license and not the core IP
    - deleted 4y ago
      [deleted]
    - Retric 4y ago
      “There’s nothing fraudulent as long as the buyers know they’e getting a license and not the core IP” That’s making a lot of assumptions, imagine the CEO of IBM set up his own company which he the sold to IBM. That kind of transaction is just ripe for conflicts of interest. Now to be clear Sesame Workshop is a nonprofit so this specific deal is less of a concern. However, public TV didn’t get the better end of this deal which is my concern as it demonstrates the obvious loophole.
      - IncRnd 4y ago
        > That’s making a lot of assumptions, imagine the CEO of IBM set up his own company which he the sold to IBM. That kind of transaction is just ripe for conflicts of interest. But, that's not what is happening HERE, which is closer to IBM still contractually paying patent royalties to a former employee of the purchased company.
        Retric 4y ago
        > not what happened HERE Sure but it illustrates things are complex. My personal belief is PBS should at a minimum have gotten perpetual rights to the episodes inside the US for any purpose. PS: IMO, toy sales is somewhat sketchy because the show acted like a commercial in the same way Transformers or My Little Pony did, but that's a different issue. Should they include shows with a toy line is more a question of their mission than how cost effective the deal is.
chrismcb 4y ago
No. Directing funds to a private school you are a board member of makes zero case for embezzlement. It doesn't even hint at it. It may be unethical, but you aren't stealing the funds but are you misappropriating them. As you said yourself if the funds go to a private school it is fine.

KerrAvon 4y ago

This is a fine position to advocate for, but it’s not the way the licensing worked here.

s1artibartfast 4y ago

I don't think closeness or relationship really has anything to do with it. A much simpler definition is if all the stakeholders were aware and consenting of the contract, and did you deliver on your obligations. Are you insinuating that the producers of Sesame Street failed to deliver or tricked those purchasing the broadcast license

Retric 4y ago
I am proposing that public TV has overpayed for Sesame Street. It can be illegal when a nonprofit does that when paying rent on a building, but it is more difficult to value IP transactions. Sesame Workshop did nothing wrong, public TV did by agreeing to such a contract at the beginning of their relationship.
- s1artibartfast 4y ago
  Why do you think public TV overpaid? If they didn't like the terms they could always not renew the license, and ultimately I guess they did. Similar arrangements are quite common in the startup world were you invent something novel. You then make a second company with a license for a specific purpose and sell the second company with the license and retain the core IP. There's nothing fraudulent about it as long as the buyers know they're getting a license and not the core IP
  - deleted 4y ago
    [deleted]
  - Retric 4y ago
    “There’s nothing fraudulent as long as the buyers know they’e getting a license and not the core IP” That’s making a lot of assumptions, imagine the CEO of IBM set up his own company which he the sold to IBM. That kind of transaction is just ripe for conflicts of interest. Now to be clear Sesame Workshop is a nonprofit so this specific deal is less of a concern. However, public TV didn’t get the better end of this deal which is my concern as it demonstrates the obvious loophole.
    - IncRnd 4y ago
      > That’s making a lot of assumptions, imagine the CEO of IBM set up his own company which he the sold to IBM. That kind of transaction is just ripe for conflicts of interest. But, that's not what is happening HERE, which is closer to IBM still contractually paying patent royalties to a former employee of the purchased company.
      - Retric 4y ago
        > not what happened HERE Sure but it illustrates things are complex. My personal belief is PBS should at a minimum have gotten perpetual rights to the episodes inside the US for any purpose. PS: IMO, toy sales is somewhat sketchy because the show acted like a commercial in the same way Transformers or My Little Pony did, but that's a different issue. Should they include shows with a toy line is more a question of their mission than how cost effective the deal is.

chrismcb 4y ago

No. Directing funds to a private school you are a board member of makes zero case for embezzlement. It doesn't even hint at it. It may be unethical, but you aren't stealing the funds but are you misappropriating them. As you said yourself if the funds go to a private school it is fine.