

Why NYC is not Palo Alto cc: MikeBloomberg - ajayjapan
http://ajayjapan.posterous.com/why-nyc-is-not-palo-alto-cc-mikebloomberg

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songexe
I'm reminded of Joel (Spolsky's) excellent commentary on this matter.

[http://answers.onstartups.com/questions/19422/if-im-
working-...](http://answers.onstartups.com/questions/19422/if-im-working-at-a-
company-do-they-have-intellectual-property-rights-to-the-stu/20136#20136)

tl;dr from the post:

"So... to answer your question. There is unlikely to be substantial difference
between the contracts that you sign at various companies in the US working as
a programmer or in the law that applies."

~~~
tghw
Joel's main point is that, even with CA's labor code, it can still come down
to a gray area around what a company's "business" is.

What I think the OP is pointing out is that in NY a company is able to set up
a more restrictive contract than a company. At the very least (and from
personal experience), companies in NY can introduce more gray areas in the
contract (making it more difficult for entrepreneurs to feel safe in working
on weekend projects) while still making it seem as if they follow the spirit
of the CA labor code.

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kschrader
At my company in NYC (Intent Media) the founders specifically spent time
writing a clause into our standard employment agreement granting everyone the
rights to their side projects.

I'm not sure how common this is, but it seems like something that everyone
should look at before signing on with a company, especially with the battle
for talent that's going on right now.

~~~
danssig
It's a show of good faith but they would have no claim to your side projects
anyway (unless you produced a direct competing product that they could
reasonably demonstrate you had stolen from them).

At least that's my view of it. If anyone has an example of some programmer
having his side project legally taken (i.e. a judge made him hand it over.
Getting intimidated into handing it over outside of court doesn't count) by a
company I'd love to see it.

~~~
bluedanieru
It's easy to brush off intimidation when you forget that fighting it often
involves a huge investment in legal fees that few individuals have the
resources to spend in a battle with a large corporation. Especially when the
law probably isn't on your side and you signed a contract giving away your IP
anyway.

How about analyzing the situation for what it is: failing to protect
independent innovation may result in less independent innovation. All the
legal speculation and contract theorizing in the world will do no good if the
facts of the matter tell a different story.

~~~
danssig
My point about intimidation was that if it is used then it still isn't proven
that the case would hold water. You can't sign yourself into literal slavery,
you can only be tricked into giving up rights that you have.

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rickyjoshi01
I think its not really about the law - most startups don't even realize it
exists. Its much more about the culture. Investors in the Valley have had
phenomenal success for some time directly investing in start-ups and firms are
willing to take a bet that they will invest in the next big thing. NYC firms
aren't as accessible, and even the big events (Disrupt) tend to be Valley
based. Also NYC has a talent issue (although I think this is changing), for a
very long-time NYC start-ups had to compete with banks to get tech talent and
there isn't a huge pool of schools feeding into the city. Finally NYC is
expensive, so its harder to get a "garage" to work from and 2K a month is
tough to live on.

That said a lot of these issues are being resolved, and I see both founders
and investors making a very big dent this time around particularly with mobile
start-ups.

~~~
zmitri
I built a hack during the hackathon at Disrupt and was shocked to see that
even though we were in New York, there were very similar traffic numbers from
California (Disrupt was using an ISP in New Jersey so I am summing NY and NJ).

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andrewpi
Nothing is stopping NYC startups & employees from drafting an appropriate
contract to make ownership of side-project work belong to the employee.

~~~
bluedanieru
Why would any employer agree to that?

~~~
danielrhodes
I find it hard to believe that it would be an unreasonable request that any
work you do outside of the office, on a personal machine, and not utilizing
any company IP be under your ownership. If such an issue does turn into a
sticking point during negotiations, you should strongly consider that a red
flag.

~~~
jrockway
Indeed. Remember, it's companies that can't find programmers, not programmers
that can't find jobs.

~~~
bluedanieru
I'd really like a list of these companies with HR departments that are going
to allow an exception to the standard contract because _we just really need
this guy._

You're absolutely right that companies would be better off in attracting
talent by revising portions of their contract. You're absolutely wrong to
suppose that they're necessarily going to do that.

~~~
jasonkester
Every one of them, in my experience. I think I've waived that particular
clause (or refused to sign the agreement) five times now for five different
employers.

You just need to mention it when they give you the agreement to sign. By the
time there's a piece of paper printed out with your name on it, they're
committed. And on the other side of the table from that piece of paper is the
guy who hired you. A reasonable person that can recognize a silly clause when
you point it out.

Just cross out the paragraph, initial next to it, then sign and hand it back.
If they want to make a big deal about it, it's them making the big deal, not
you.

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ntolia
Unfortunately, the blog post is somewhat flawed. In the CA law he references,
it clearly states that the exception to you owning your code/ideas is if they
"relate at the time of conception or reduction to practice of the invention to
the employer's business, or actual or demonstrably anticipated research or
development of the employer."

While IANAL, the consensus on a number of websites is that, while working for
a tech startup, anything that you do in your free time could technically
belong to the company you work for as its related to your "employer's
business."

~~~
boucher
You're misreading the law. As an example, if you work for a software company
that makes iPhone games, and you write an iPhone game in your spare time and
with your own resources, that game could be at risk of being owned by your
employer. If, however, instead of making an iPhone game you make a photo
sharing website, there's very little risk that your work could be owned by
your employer.

There are obviously lots of gray areas in between. If you're planning to try
and make money off something you built in your spare time, you should talk to
a lawyer.

~~~
nbpoole
As you pointed out, it's a gray area.

[http://answers.onstartups.com/questions/19422/if-im-
working-...](http://answers.onstartups.com/questions/19422/if-im-working-at-a-
company-do-they-have-intellectual-property-rights-to-the-stu/20136#20136)

" _Not related to your employer's line of work. Um, wait. What's the
definition of related? If my employer is Microsoft, they do everything. They
made a goddamn BARNEY PLUSH TOY with a computer in it once. Are plush toys
related? Obviously operating systems, compilers, desktop applications, search
engines, and games are related to Microsoft's line of work. Hmmm._ "

" _This ambiguity is meant to create enough of a chilling effect on the
employee working in their spare time that for all intents and purposes it
achieves the effect that the employer wants: the employee doesn't bother doing
any side projects that might turn into a business some day, and the employer
gets a nice, refreshed employee coming to work in the morning after spending
the previous evening watching TV._ "

~~~
michaelochurch
_This ambiguity is meant to create enough of a chilling effect on the employee
working in their spare time that for all intents and purposes it achieves the
effect that the employer wants: the employee doesn't bother doing any side
projects that might turn into a business some day, and the employer gets a
nice, refreshed employee coming to work in the morning after spending the
previous evening watching TV._

I don't think it's this devious. It's simpler than that. Strategically and
legally speaking, you never don't want rights, even if those are rights you
shouldn't, by any reasonable moral judgment, have. Companies ask for
aggressive terms not to be malevolent and devious but because the lawyer's job
is to get the most aggressive terms (i.e. the most rights) possible. If it
were legal for a company to assert rights over an employee's work for 2 years
after employment, shareholders would expect executives, and executives would
therefore expect lawyers, to push for those terms. The game, at least in
theory, is about getting the most aggressive (and yes, often unfair) terms
upfront and letting the courts sort it out.

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adamtmca
While interesting, this seems like an insignificant piece of minutia,
considering the title.

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michaelpinto
I recently took that startup genome quiz and I hit upon a truth that I sort of
already realized: To launch a successful startup you need to do it full time.
So yes your weekend project could be the next Facebook, but the odds are
really against you.

I think the real issue with Silicon Alley (having been a part of the scene
since the early 90s) is that Wall Street still swallows quite a bit of the top
tech talent — that with a super high overhead can get in your way. It's better
than it was years ago, but that's more of the big issue for NYC as I see it.

~~~
mahyarm
To experiment the waters in the first place, before you go full time, that
weekend project can be very helpful.

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dblock
Has anyone with a successful w/e project been successfully sued over this in
NY state and lost?

~~~
zedshaw
Yes, IBM is in NY state. If you want me to do your homework for you and buy a
license for WestLaw then I'll pass. I'll leave it to you to prove a negative.

