Digium Lawsuit

phoneguy

Guru
Joined
Jan 13, 2008
Messages
285
Reaction score
54
And please lets not turn this into a flame war. I post this because things like this can hurt anyone selling Asterisk based systems if code Digium includes in Asterisk turns out not to be Open Source we all have liability from our customers if they were to get sued for using such code.
 

randy7376

Defnyddiwr Gweithredol
Joined
Sep 29, 2010
Messages
864
Reaction score
144
Thanks for the posting, Tony.

I just finished reading the article and it is very one-sided towards LiveOnTheNet.

I would hope Digium has some kind of response to this as I would like to hear their side of the story.

I did find this part a bit odd:

Moore said the company contracted with Digium to write the computer code for the voice chat system and paid Digium around $293,000 from 2005 to 2008. He said LiveOnTheNet owned the work product developed under the contract.
It seems strange that Digium would contract programming out to a third-party and relinquish any rights to the developed code. That would be like me writing software for the company I work for, on company time, and then claiming it is my code to do with as I wish when it legally belongs to the company.
 

mbellot

Active Member
Joined
Dec 15, 2008
Messages
404
Reaction score
185
Thanks for the posting, Tony.

I just finished reading the article and it is very one-sided towards LiveOnTheNet.

I would hope Digium has some kind of response to this as I would like to hear their side of the story.

I did find this part a bit odd:

It seems strange that Digium would contract programming out to a third-party and relinquish any rights to the developed code. That would be like me writing software for the company I work for, on company time, and then claiming it is my code to do with as I wish when it legally belongs to the company.

I think you (or perhaps I) misunderstood.

My take in it is that LOTN paid Digium to develop the code (not the other way around, which appears to be what you're thinking).

If that's the case, then (unless the contract states otherwise) the code created would be the property of LOTN.
 

lowno

Guru
Joined
Feb 18, 2009
Messages
125
Reaction score
8
This is not good. There is an issue here on ethics. That is a huge amount of money in damages. I wonder what digium nets in a year.
 

randy7376

Defnyddiwr Gweithredol
Joined
Sep 29, 2010
Messages
864
Reaction score
144
mbellot,

I think you understood correctly. It's me... Yes, I read that totally backwards. :banghead: It's what I get for skimming. I originally read it as LOTN was contracted to write the code. I completely missed the "and paid Digium" part...

Between people taking equipment from the IT office without permission and prepping for a business trip to San Antonio, next week, I'm not completely surprised I goofed. :crazy:

Thanks for setting me straight! I still want to hear Digium's side, however.
 

EndeavorPBX

Member
Joined
May 18, 2011
Messages
53
Reaction score
6
Based upon my reading of this article only, it does not appear that this case has anything to do with Asterisk or the code in Asterisk.

There's also no indication that the Plaintiff sought injunctive relief (i.e., an order to prevent Digium from continuing to use the infringing code). However, since that's normally decided by the Judge after the jury returns a damages award, that may still come. Usually, when there's more to come, these kinds of articles will make a note of that fact.

Based upon the article, I would be concerned about this only if Digium doesn't have sufficient assets to pay the judgment. Anyone know how much $$ Digium has in the bank?
 

Michelle

New Member
Joined
Sep 30, 2011
Messages
1
Reaction score
0

[FONT=&quot]In response to this inquiry, Digium would like to state that the matter has been resolved. Additionally, Digium would like to assure users of the Java IAX stack, which was the subject of the dispute, that Digium has the rights to license this software. Digium denied and continues to deny any allegations of wrongdoing, and while we are greatly disappointed with the outcome of the lawsuit, we would like to reassure our customers, partners, and loyal supporters that neither the litigation nor its outcome will impact Digium's business with its channel partners, resellers, customers, or our commitment to the Asterisk Open Source Community. We look forward to expanding all of our valued partnerships and relationships as Digium continues to grow and move forward.[/FONT]

Michelle Petrone-Fleming,
In-House Counsel for Digium
 

hraynor

Guru
Joined
Feb 11, 2009
Messages
137
Reaction score
1
FYI - I know NOTHING of the particulars of this case (other than what's here and the linked article), however, I will state that it is VERY common for a company, when contracted to develop custom software as part of a Professional Services engagement for their customer, to stipulate in the contract that it also retains full rights to do whatever they want with the code in the future.

ie: It COULD have been that Digium had a clause in the contract that while LiveOnTheNet had full rights to what they paid Digium to develop, that Digium also maintains full rights to the source code and uses and can do anything it wishes with it (including sell it, make it open source, etc).

This is fairly standard in the industry, and while I'm sure many disagree with this, its all about what is in the contract.

Having been involved with reviewing and editing many contracts in the past in the software industry, I definitely have to state that one needs to be VERY careful about what is in the contract, and spell out specifically in great detail what is expected.

Its my guess that Digium may have had something allowing them to redistribute this in their contract. Or perhaps maybe not, but that LiveOnTheNet may not have SPECIFICALLY excluded it in the contract (often times lack of a specific exclusion doesn't deter the action).

But from my experience, these type of things in contracts for custom development work are VERY common and standard (though typically in the fine print). :)
 

phoneguy

Guru
Joined
Jan 13, 2008
Messages
285
Reaction score
54
What do you mean it has been resolved. Does this mean you have paid the judgement? Or has the judgement been vacated or was a settlement reached? Your statement offers more confusion and questions than it answers in my opinion.

Also do you have some type of proof that all of the community is protected on this and that you now have the rights to distribute the code because based on the judgement they found you did not have the rights to open source the code.

Please help us all understand.
 

drclue

Member
Joined
Jun 26, 2009
Messages
140
Reaction score
0
Not sweating it one bit

Having read the article , but not being able to
find more references, my opinion is at this point tentative.

I'm certainly no lawyer nor legal scholar, but this all seems
clear enough to me , not to worry one bit.

Firstly the nature of the suit does not seem to take
aim at any core function or feature of Asterisk itself, but
rather even as the plaintiffs would seem to imply
a "work for hire" issue relating to a specific application built
against asterisk, but in and of itself separate from asterisk.

This is actually excellent news as whatever ill may come of
it , even if the judgement were to go forward and all appeals
failed and no hallway deals were struck, Asterisk itself is really
not involved.

At the very worst , Digium itself would have to sweat out
an appeals process and perhaps in the end cough up
$8.7 million , which sounds like a lot and while certainly a
meaningful amount is not going to kill Digium.

So unless I see new information that changes my opinion,
I see nothing to sweat about , although it was an interesting
bit of news.


--Doc
 

wardmundy

Nerd Uno
Joined
Oct 12, 2007
Messages
19,170
Reaction score
5,199
I don't know the facts in this case. But, speaking hypothetically only, if you hire someone to write code for $300,000 and the code doesn't do what it's supposed to do, the normal damage claim would have been in the ballpark of $300,000. If the jury award is 25 times that much, then there's something else going on.

At least from the article, the plaintiff seemed to feel that Digium ran them out of this business by reselling the code to another company AND open sourcing some of the code. The amount of the jury award tends to suggest the jury may have agreed with that argument.

We subsequently found another article that reports: "The trial lasted more than two weeks; Live On the Net was awarded $1.18 million in compensatory damages and $7.5 million in punitive damages." And a review of the docket shows a Motion to Reconsider was filed on March 4, 2011.

So... a more lucid explanation (other than "not to worry") would obviously be helpful. Did the case settle? Did Digium get a clarification on the rights of the parties in that settlement? If so, what were the terms?
 

drclue

Member
Joined
Jun 26, 2009
Messages
140
Reaction score
0
I don't know the facts in this case. But, speaking hypothetically only, if you hire someone to write code for $300,000 and the code doesn't do what it's supposed to do, the normal damage claim would have been in the ballpark of $300,000. If the jury award is 25 times that much, then there's something else going on.

Of course , there is something going on. The big wad
of money seems to include...

*** Damages for "lost revenue" (the largest portion of the award I believe)
*** Cost of code development
*** Probably all the legal fees .etc etc.

The lost revenue bit seems to be related to the thought
that the sale of a *similar* program by Digium to another
customer in another country (the UK) included a piece of re-purposed code
from this project for the plaintiff's in Alabama US

I would need to know more about the bit of code (JAVA I believe) that
was re-purposed to form an opinion if this was truly specific work product
or basic code re-use. I can't think of any project in my 30 years of programming
that did not involve reaching into my code piles for some pre-existing
code fragments , classes or what have you.

If that code was the plaintiff's secret family recipe for baked beans
that would be one thing, if it was some sort of fairly generic functionality
I would bounce the plaintiff's claim right out of my armchair court.

Personally , having dug around a bit , I think the only profits
the plaintiff would ever have realized were in this court
case anyways. Go ahead , spend a few moments Googling this situation,
and see if you don't notice something truly odd about the plaintiff's
web presence.

While not surprised I am sorta curious how the
development costs reached the $300,000 ballpark on this, as while
the specifications are a little sketchy , this is NOT that complicated
an application. It's not even as complicated as AsterClick, whose
total lifetime project revenues would not even buy the coffee
for this drama. (but that's another thread)

Just the other day I was commenting on the technical
aspects of a very *similar* application being discussed elsewhere
on this forum involving the creation of a mass meetme/conference application,
and I can tell you with some certainty that I would have a hard time
citing a $293,000 price tag while maintaining a straight face.


The bug complaints are sorta telling too. For instance tallying the
number of users participating in the stream was
one of the cited bugs. For licensing of events , I can see this
being something to complain about , but one would not be able to
complain about that unless the actual program was already working.

This particular complaint was one of book keeping and *may* not
have been a totally valid complaint depending upon some minor details.

Of course this case was floated in Alabama , which is not exactly
Silicon valley technologically, so a little razzle dazzle can go a lot
further in the court room when it comes to technology.

Looking at some of the complaints about the "bugs" in the coding
product and whatever else I could gleam , it did indeed seem that
the plaintiff should have gotten a far lower award (if any), so this is
almost certainly going to appeals unless a hallway deal is struck,
and perhaps they'll get a more technically savvy group deciding that appeal.

Most Judgment appeals on this kind of thing seem to
get the award amount reduced.

Anyways , I think this largely a Tempest in a teapot, but it
is a blast to watch folks scurrying around about it :)



--Doc
 

drclue

Member
Joined
Jun 26, 2009
Messages
140
Reaction score
0
The system is largely comprised of non-technical people so everyone from Judge to Janitor seems completely unable to grasp anything other than a superficial understanding of the points at issue. In my industry a "sure thing" doesn't exist, because it falls to a non-technical lawyer briefed by a non-technical assistant to explain highly techinical isues to non-technical people.


Most certainly I agree.

Actually programmers , lawyers, and other professions along
with their respective customers often share the same kind of
difficulties.


In the end though , I think that often folks misunderstand
their relationship with with a professional like a lawyer.

Lawyers do law , and that's what they know. They understand
the mechanics of the law and have the familiarity to give
advice on legal choices as they relate to legal mechanics.


Often they grow accustomed to having clients who are
stressed, fearful and just looking for problems to go away.

The problem is that leaving one's professional to guess at their
profession is exactly the same thing as the client guessing at
theirs. Both parties will probably get it wrong.

If they don't understand your situation you make sure they do.
If your best expressions can't get the point across then find
someone who can express it better. If all those attempts fail,
it's probably a mismatch.

Often professionals appear busy and hurried , but often that's
because they are. Think of your situation as having a serious
peanut allergy. No matter how hurried the person taking your
order your going to make sure your meal won't make you ill
or possibly kill you.

The professionals are often surprised by clients who
speak up , but typically are more than willing to take the time
or schedule the time to get it right. If they are not willing
to understand your situation , here again maybe you have a
mis-match.

Various professionals are not 'set and forget' magic wands.
They are hired tools and as fancy or knowledgeable as they
might be, your still the one directing them. That's
why those high school carpentry projects came in such variety
and quality in their outcome even though everyone had access
to the same tools
 

EndeavorPBX

Member
Joined
May 18, 2011
Messages
53
Reaction score
6
Ward,

What you've failed to account for is the venue. Alabama is the same venue that awarded millions to the buyer of a car with a few hundred dollars in undisclosed damage. Ultimately reversed by the U.S. Supremes. The defense bar would refer to Alabama as a "Judicial hellhole." While I don't agree with that assessment, it may explain the amount of the award...

I don't know the facts in this case. But, speaking hypothetically only, if you hire someone to write code for $300,000 and the code doesn't do what it's supposed to do, the normal damage claim would have been in the ballpark of $300,000. If the jury award is 25 times that much, then there's something else going on.

At least from the article, the plaintiff seemed to feel that Digium ran them out of this business by reselling the code to another company AND open sourcing some of the code. The amount of the jury award tends to suggest the jury may have agreed with that argument.

So... a more lucid explanation (other than "not to worry") would obviously be helpful. Did the case settle? Did Digium get a clarification on the rights of the parties in that settlement? If so, what were the terms?
 

EndeavorPBX

Member
Joined
May 18, 2011
Messages
53
Reaction score
6
Normally, when these types of matters are resolved, the parties agree not to discuss the resolution. If I had to guess, I'd guess that Digium paid less than the amount of the judgment in exchange for an agreement not to file a motion for new trial, an appeal, or both.

The amount of $$ paid would depend upon the number of errors committed by the Judge during trial and the lawyers estimates of the probability that a new trial would be ordered or the judgment would be reversed on appeal. Also, Digium may have gotten some money from their insurance company, which may have been on the hook for some (or all) of the claim, or which might have paid simply to avoid having to pay the costs associated with a new trial motion, another trial, and/or an appeal.

As Ward mentioned in another post, the amount of this Judgment is fairly high, and as I noted in response to his post, Alabama is well known for excessive awards that are reversed on appeal.

If there has been a resolution, I'd also guess that it'd include a license allowing Digium to use whatever code they're using.

The only way to verify that there has been a resolution is to get a look at the docket of the case. If the judgment has been satisfied, or the case has been dismissed, then you can be confident that the case has been resolved in some manner. That doesn't mean that Digium has a license to use the relevant code, but it means the dispute is over...

Interesting response, is there not a more detailed statement from Digium somewhere? Resolved? I guess it is resolved if you consider losing a lawsuit the resolution. Did Digium obtain clarification of the rights as part of the settlement? Otherwise it would seem that the courts disagree that "Digium has the rights to license this software."
 

wardmundy

Nerd Uno
Joined
Oct 12, 2007
Messages
19,170
Reaction score
5,199
Sorry, EndeavorPBX, I'm still chuckling. Had to send your post to some of my friends. I've been a member of the Alabama Bar [strike]for over 40 years[/strike] since the KKK era. Like most states, there are probably places in Alabama that might qualify as a "judicial hellhole." Huntsville doesn't happen to be one of them. The presiding circuit judge actually tried this case.

FWIW, my law school roommate is now a judge on the same court where this was tried. Another dozen of my classmates are judges all across Alabama including a few on the U.S. District Courts in Alabama as well. To a person, they're about as fair-minded as any judges I know, and I know several hundred. Of the ones I know, I probably could name a few that would meet your qualifications, but none of them are in Alabama.

If you think Alabama juries are scary, visit a courtroom in your local community and watch for a while. You'll find Alabama doesn't have a monopoly on that either. My guess would be that Huntsville juries are about as well educated as any juries in the country. Remember, there's NASA's space center in Huntsville as well as Redstone Arsenal where the military designs its missiles, etc. In short, the place is bubbling over with rocket scientists.

From the newspaper article at least, it doesn't appear that the jury was all that confused. They seemed to understand exactly what the plaintiff was alleging... and agreed. We'll see what we see.
 

vcallaway

Guru
Joined
May 6, 2008
Messages
170
Reaction score
2
Actually, I've been called for jury duty several times and I always go. I feel it is my duty to make sure a jury is not made up of complete idiots.

I have actually been surprised at the caliber of folks that I've run into. Many large companies around me pay people their normal pay that get called. Certainly changes the jury pool dynamic.
 

Members online

Forum statistics

Threads
25,782
Messages
167,512
Members
19,203
Latest member
frapu
Get 3CX - Absolutely Free!

Link up your team and customers Phone System Live Chat Video Conferencing

Hosted or Self-managed. Up to 10 users free forever. No credit card. Try risk free.

3CX
A 3CX Account with that email already exists. You will be redirected to the Customer Portal to sign in or reset your password if you've forgotten it.
Top