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Would publishing code under a limited company be a viable approach to avoid liabilities from OSS? Of course it shouldn’t be necessary, I’m just trying to think

Would publishing code under a limited company be a viable approach to avoid liabilities from OSS? Of course it shouldn’t be necessary, I’m just trying to think of a practical way for an individual to avoid this scenario.

dleslie 4y ago
Nope; in fact, the MIT license isn't really of consequence here except in that it doesn't address a possible fiduciary/beneficiary relationship with users.
tooltitude 4y ago
As far as I remember, the author of this book: https://www.amazon.com/Intellectual-Property-Open-Source-Protecting/dp/0596517963 https://www.amazon.com/Intellectual-Property-Open-Source-Pro... Recommended a scheme to shield OSS developers from liability. I am not a lawyer, so it looked a bit overly cautious to me, but it seems that was a good idea.
- tooltitude 4y ago
  See the chapter 14 called incorporating as non-profit. He mentions a case where Gaim (a messenger software) developers were sued by AOL.
nullc 4y ago
Some of the defendants (the developers of Bitcoin ABC now called eCash, an alternative cryptocurrency based on Bitcoin and its blockchain) had organized their development under an LLC. Hasn't helped so far, though in the unlikely event that the case is ultimately lost it might help them constrain recovery of damages to the assets of the LLC. I think in general structural improvement like that are most effective against 'honest' opponents-- someone whos goal is to win and recover their costs and damages. A legal structure that limits liability makes recovery less likely, so they don't bring the action at all. For an opponent who's goal is to harass and ultimately crush the opposition, I think that kind of tool is probably less effective. It's also harder to justify doing when you're just following a volunteer passion over something speculative and worthless (as was the case of the Bitcoin related defendants-- almost all of whom started close to the beginning of Bitcoin). [And as an aside: to the extent that development is done on an uncompensated purely voluntary basis, it would be difficulty to legitimize the LLC, e.g. little to no income or expenses or other documentation that the LLC is anything but a piece of paper.]
- MuffinFlavored 4y ago
  Why can't the LLC just claim bankruptcy/claim it has no assets/make it so it has no assets to forfeit?
  - nullc 4y ago
    It (potentially) can. But this also follows along the answers "since you're not in the UK why not ignore it"-- if a court later decides to allow recovery of assets that came from the LLC or pierce the corporate veil entirely you're screwed-- at that point you lost your chance to defend yourself.
cldellow 4y ago
I'm not a lawyer, but I've asked these kinds of questions to lawyers. Paraphrasing, the answer I got was: "Anyone can sue anyone for any reason, and then we have a legal process to determine the result. If you're a director of the company, they're probaby going to sue you personally, and you're going to have to spend a lot of money to argue that you personally shouldn't be liable. Hopefully you'll be successful. It'll all depend on the facts, so you'll need to get sued first before I can give you a better answer. Either way, it's going to cost you money." My conclusion is that the legal system is not super great when a bad-faith actor is involved. Though, really, it's also not super great when good-faith actors are involved, either.
chippiewill 4y ago
The liability isn't really on the software itself, but the fiduciary responsibility that they _might_ have through their supposed control of the Bitcoin network through their control of the official software repository. A Ltd company would help a little, but individuals within a company still have fiduciary responsibility.

dleslie 4y ago

Nope; in fact, the MIT license isn't really of consequence here except in that it doesn't address a possible fiduciary/beneficiary relationship with users.

tooltitude 4y ago

As far as I remember, the author of this book: https://www.amazon.com/Intellectual-Property-Open-Source-Protecting/dp/0596517963 https://www.amazon.com/Intellectual-Property-Open-Source-Pro... Recommended a scheme to shield OSS developers from liability. I am not a lawyer, so it looked a bit overly cautious to me, but it seems that was a good idea.

tooltitude 4y ago
See the chapter 14 called incorporating as non-profit. He mentions a case where Gaim (a messenger software) developers were sued by AOL.

nullc 4y ago

Some of the defendants (the developers of Bitcoin ABC now called eCash, an alternative cryptocurrency based on Bitcoin and its blockchain) had organized their development under an LLC. Hasn't helped so far, though in the unlikely event that the case is ultimately lost it might help them constrain recovery of damages to the assets of the LLC. I think in general structural improvement like that are most effective against 'honest' opponents-- someone whos goal is to win and recover their costs and damages. A legal structure that limits liability makes recovery less likely, so they don't bring the action at all. For an opponent who's goal is to harass and ultimately crush the opposition, I think that kind of tool is probably less effective. It's also harder to justify doing when you're just following a volunteer passion over something speculative and worthless (as was the case of the Bitcoin related defendants-- almost all of whom started close to the beginning of Bitcoin). [And as an aside: to the extent that development is done on an uncompensated purely voluntary basis, it would be difficulty to legitimize the LLC, e.g. little to no income or expenses or other documentation that the LLC is anything but a piece of paper.]

MuffinFlavored 4y ago
Why can't the LLC just claim bankruptcy/claim it has no assets/make it so it has no assets to forfeit?
- nullc 4y ago
  It (potentially) can. But this also follows along the answers "since you're not in the UK why not ignore it"-- if a court later decides to allow recovery of assets that came from the LLC or pierce the corporate veil entirely you're screwed-- at that point you lost your chance to defend yourself.

cldellow 4y ago

I'm not a lawyer, but I've asked these kinds of questions to lawyers. Paraphrasing, the answer I got was: "Anyone can sue anyone for any reason, and then we have a legal process to determine the result. If you're a director of the company, they're probaby going to sue you personally, and you're going to have to spend a lot of money to argue that you personally shouldn't be liable. Hopefully you'll be successful. It'll all depend on the facts, so you'll need to get sued first before I can give you a better answer. Either way, it's going to cost you money." My conclusion is that the legal system is not super great when a bad-faith actor is involved. Though, really, it's also not super great when good-faith actors are involved, either.

chippiewill 4y ago

The liability isn't really on the software itself, but the fiduciary responsibility that they _might_ have through their supposed control of the Bitcoin network through their control of the official software repository. A Ltd company would help a little, but individuals within a company still have fiduciary responsibility.