

Microsoft apology for code theft may not do, Plurk says - ilamont
http://www.thestandard.com/news/2009/12/16/microsoft-apology-code-theft-may-not-do-plurk-says

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thaumaturgy
Plurk's gonna burn a lot of sympathy if they do, and it may not even be a
tactically sound decision.

The situation was handled swiftly and correctly by Microsoft. It got Plurk
some free press. It wasn't even caused by Microsoft directly, but by a
contractor they had hired. And, best of all, although ordinarily you might be
able to allege that it cost you sales ... this all happened in a market in
which Plurk has been denied access anyway.

This isn't David and Goliath anymore. Plurk was fortunate to get a swift
response from Microsoft in their favor; if their next move is to start a fight
with Microsoft, I fully expect that Microsoft's expert, well-paid legal team
will chew them up and spit them out.

I'd much rather see Plurk issue a press release stating simply the matter has
been resolved and they appreciate Microsoft's swift action.

~~~
lurch_mojoff
So Plurk should roll over and forget anything happened just because Microsoft
said they are very sorry? You see such benevolence from big corporations in
the same situation almost never. Why should Plurk do any differently?

As for Microsoft's swift reaction, it was not necessarily a result of
Microsoft's kindness of hart and honest remorse. It probably is more of an
attempt on Microsoft's part to not get themselves into a deeper hole than they
already are in. And no mater how expert or well paid their lawyers are it
won't change the fact that they are in the wrong here. There is very little
chance Plurk will end up being chewed up and spat out.

And lastly, this is big business, not preschool - the excuse "but a contractor
did it, it's not my fault" doesn't work. Microsoft are (one of) the legal
entity (-ies) behind that service. They are ultimately responsible for things
like this copyright violation. They are free to seek compensation for the
damages from the contractor, but legally speaking (well, not really, I'm not a
lawyer and this is not legal advice, but still), as far as Plurk are concerned
Microsoft are the offender. And don't feel bad about Microsoft, there is a
good chance they'll end up with a net positive, at least financially.

~~~
cturner

        So Plurk should roll over and forget anything happened
        just because Microsoft said they are very sorry?
    

That's exactly it.

    
    
        You see such benevolence from big corporations in the
        same situation almost never. Why should Plurk do any
        differently?
    

What other people do is irrelevant. I suppose it could be something if you
were talking about a patent troll, but you're talking about Microsoft.

Microsoft focuses on building software that corners markets. That's a
legitimate mode of operation for a company.

MS did the right thing in their response to this issue. Plurk has suffered no
damage, and indeed has won press. Plurk should now also do the right thing and
get on with trying to build software, and avoid the martydom track.

    
    
        And lastly, this is big business, not preschool - the
        excuse "but a contractor did it, it's not my fault"
        doesn't work. 
    

But that's not what they said. They accepted responsibility for it.

It's also not in their Plurk's interest to go legal as it will be a
distraction from building software.

~~~
lurch_mojoff
You seem to imply that if the situation was reversed, if someone had ripped
off Microsoft's code and when caught they stopped the service and apologized,
Microsoft wouldn't sue them up the wazoo. How realistic do you think is such
statement?

And yes, it probably is in Plurk's best interest to either seek settlement or
sue Microsoft over this - for one it will show that they wont tolerate being
ripped off (otherwise what's stopping someone else doing it again tomorrow and
when caught "sincerely" apologizing) and for two, for a small and relatively
unknown company it makes perfect financial sense to do so, they will probably
make more money this way than they'll be able to make in 10 years "building
software".

------
grellas
Assuming U.S. law (or its equivalent) will apply here, the law is clear that
Plurk can sue and recover damages for this misconduct, even with Microsoft's
rapid action to deal with the issue. Even assuming the unlikely scenario that
the contractor did it entirely without Microsoft's knowledge, Microsoft and
the contractor would be jointly (and severally) liable, and Microsoft in turn
would be able to cross-sue the contractor to get indemnification under the
contract between them.

That said, there is such a thing as acting with class even when lawsuit
remedies are available and the actions of the parties will undoubtedly be
evaluated at that level as well.

This is the type of situation where a company like Microsoft would be highly
unlikely to want to defend a lawsuit of this type if it had other reasonable
choices and perhaps what is motivating Plurk is the temptation posed by the
prospect of being able to push the legal issue in hopes of extracting some
settlement money. Undoubtedly, in the background, some stiff demand letter has
already been sent asking for some payout in the context of confidential
settlement discussions. I actually don't blame Plurk for this - it is a
reasonable thing to do in this context, even if their primary desire is not to
drag this thing through the courts. How this will look to people is another
issue, however, and such a strategy could easily backfire given that Microsoft
has tried to deal with this swiftly and decisively and in a way that certainly
appears reasonable given what happened.

~~~
ynniv
Why would you assume that US law will apply in a situation where a Chinese
company lifts code from a Canadian company while contracting for a
multinational company headquartered in the US but operating in China?

~~~
grellas
I don't assume that U.S. law will apply. I am predicating my comment with this
statement to make clear that the sort of analysis I am articulating would only
apply _if_ U.S.-style law applies to the situation. If U.S.-style law doesn't
apply, then Plurk's legal remedies might be few, if any. This likely would be
one of the trickiest issues in this case if a lawsuit ever sees the light of
day.

The doubt on this point, by the way, would be one more reason for Plurk not to
push the legal side too hard here.

~~~
ynniv
So hypothetically, if Microsoft hired a US based corporation to create a
microblogging site, and that corporation copied the source code for Twitter,
re-branded it as Microsoft specified, and the site went live, Microsoft would
be liable? Where is the line then? Are individuals equally liable if they use
software that was lifted unbeknownst to them by a software publisher?

~~~
grellas
Copyright law generally does not excuse "innocent infringers" and is pretty
strict in this sense (here is a link to a discussion of copyright that sums
this up in the first two paragraphs:
<http://www.ladas.com/NII/CopyrightInfringement.html>).

This sort of liability can extend to average people as well, as for example in
this news report of a 2-lawyer firm that hired an SEO guy as a contractor for
a $1K job and wound up with a $60K+ liability (and certainly must have spent
many thousands more in attorneys' fees) as a result of that contractor's
having lifted some copyrighted promotional materials wholesale from another
law firm's website and used that infringing material as its deliverable for
the project
([http://www.law.com/jsp/article.jsp?id=1202432820979&src=...](http://www.law.com/jsp/article.jsp?id=1202432820979&src=EMC-
Email&et=editorial&bu=Law.com&pt=LAWCOM%20Newswire&cn=NW_20090806&kw=9th%20Circuit%20Finds%20for%20PI%20Firm%20Over%20Theft%20of%20Firms%20Web%20Site%20Content)).

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jws
If someone tips off the BSA that you have a bunch of Office installs without
licenses, and when the investigators come you say "Oh sorry, we'll uninstall
the extra ones.". Is that "case closed"?

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mdasen
I think Plurk should have stayed quiet for a few days and let Microsoft
negotiate with them privately. Clearly one doesn't want to just let Microsoft
off the hook, but there's a decent potential that Microsoft would be willing
to pay private, non-disclosed reparations or even license the technology or
buy the firm. Once the initial problem is fixed (and that has happened), one
can quiet down a little and not create further hostility in the hopes that a
good, mutually-beneficial outcome will happen.

Microsoft didn't fight and didn't try to use its market position once they
found out what happened and, while that doesn't abdicate one of
responsibility, it does mean that you can deal with them a bit more in good
faith. Granted, that's easy for me to say - it wasn't my work that was ripped
off and so I'm not as emotionally involved as the Plurk people who are
probably (rightfully so) angry.

------
robk
Microsoft was caught red-handed stealing and blames a contractor. A company is
responsible for its contractors and bears legal liability in most
jurisdictions for their actions. While it was good of them to apologize and
pull it down immediately, Plurk is right to pursue Microsoft further if they
so choose.

If, say, your kid gets caught stealing a car and say "oops, sorry" then walks
away, that doesn't make everything ok.

~~~
Estragon

      A company is responsible for its contractors and bears 
      legal liability in most jurisdictions for their actions.
    

I wasn't aware of this, and it doesn't make much sense to me. Can you point me
to some example statutes?

~~~
mbreese
Work done by a subcontractor is (in most circumstances) considered work-for-
hire. So the main company owns the product of that work (in this case code).
If the main company decides to publish this work as their own, they take on
all the liabilities associated with that action. It is up to Microsoft to
police itself and it's contractors. If it doesn't, that then opens them up to
legal liability. The fact that they took care of the problem quickly doesn't
lessen that liability (it only stops the liability from getting bigger).

If this wasn't the case, what would stop the companies of the world from
hiring shady sub-contractors to steal other's IP and code, pass it on to the
hiring company, and then let the hiring company sell that IP/code as it's own?
Where are the repercussions?

Let's be clear about this: there are two aggrieved parties in this: Plurk and
Microsoft. Plurk was aggrieved by Microsoft when MSN China attempted to use
Plurk code as their own. Microsoft was aggrieved by the sub contractor used by
MSN China when they tried to pass off code stolen from Plurk as a unique work.

Legally (IANAL), Plurk's beef is with Microsoft. If MSFT then wants to sue the
contractor, that is up to them.

~~~
Estragon
I see, I was reading "A company is responsible for its contractors and...
their actions" in much broader terms, like "contractor builds parts using
child labor." Thanks for the clarification.

------
ynniv
A lawsuit does not sound like a good idea. Microsoft has a top notch legal
team, the wrongdoing was committed by an outside vendor, and there are three
countries involved, each with their own IP laws. A suit will be long and
expensive, and MS will do everything in their power to put all liability on
that outside vendor, who probably has meager assets to pay damages. Even if
they win, the reward will be attempting to collect damages from an
uncooperative company somewhere in China.

Plurk: you got your goodwill and free press, don't push your luck. All you
will get from a lawsuit is a five year headache and huge bills from your
lawyer.

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wglb
It wouldn't totally astonish me if MS eventually settled, perhaps sooner
rather than later. The fact that they gave a flat out blunt apology (as
opposed to a non-apology apology: "we are sorry you feel that way") shows that
they understand the seriousness of the error, and own up to it, even though
the contractor did the deed.

~~~
GiraffeNecktie
From a legal perspective, I'm not sure that it matters whether the work was
done by a contractor or employee. Whoever asked for the work to be done and
paid for it is ultimately responsible for ensuring that it was done within the
law. Certainly MS would be able to turn around and sue the contractor, but
that's a separate issue.

------
sfk
I do hope that Plurk goes to court with this. The situation was handled
gracefully by Microsoft but a crucial question remains:

Can you outsource to the lowest bidder and expect to get back untainted code?
I don't think so. Producing good original code is hard and cannot be done in
sweat shops under a tight deadline. Managers at Microsoft should have known
this and be held responsible for their actions.

EDIT:

I do not have a source for the above claims, but I would like these issues to
be explored in court. Let's say I would not be surprised if they were true.

~~~
chollida1
> Can you outsource to the lowest bidder and expect to get back untainted
> code? I don't think so. Producing good original code is hard and cannot be
> done in sweat shops under a tight deadline. Managers at Microsoft should
> have known this and be held responsible for their actions.

Do you have a source that said Microsoft contracted out to the lowest bidder
or that that bidder was a sweat shop. I haven't seen evidence of either.

For all we know they hired a company that came highly recommended. The
transgression doesn't give us any insight into this.

------
figital
Just a follow-up for those who downmodded me for pointing out that the
original complaint/post mentioned (virtually) nothing about de-obfuscation:

"Speaking technically, what makes our claim a little stronger is that Plurk's
client side code was obfuscated to begin with, so someone went in there and
had to spend some real effort to unpack/reengineer the JS code and prettify it
on their end," [a spokesman for Plurk] said."

------
radioactive21
Stop making this such a big deal, its like every little thing on the internet
has to be bracken down into some philosophical principal that was violated.

This is the best thing that could have happen to Plurk. Microsoft could just
buy the whole darn thing, which they probably would have anyways.

Bad rep for Microsoft???? I already thought Microsoft's rep was in the dumps
seeing as how every internet site trashes them.

Principal? Like this thing doesnt happen all the time, or like how big
companies havent already bought up every little company that stood in it's
way? At lease Plurk can get more money with all the PR, if they ever sell.

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duncanj
Perhaps the BSA could give MS the same deal as everyone else: shut them down
for 4 days to inspect their systems for any evidence of pirated software, or
fine them something like 2% of revenues.

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voidpointer
Is it known what the contractor was hired to do? I guess Microsoft didn't just
post on rent-a-coder to get the lowest bid on "a microblogging site like
Plurk.com".

How deeply was MSFT involved in the project spec and to what degree was that
spec based on Plurk?

------
tybris
They should just try to get a good licensing deal out of it.

~~~
i386
Absolutely - If I were Plurk I'd be sellin out to Microsoft right now.

