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The client wouldn't pay, so he gives it to them for free anyway?

He also gave it to the client's competitors for free.

He's trying to make the best of a bad situation- he put in a lot of time for which he was not compensated, but perhaps he can get some good PR out of it. Maybe down the road someone else will use his software and throw him some billable hours for customization.

The client likely can't afford to pay anyone to continue (and they should ask for payment upfront now, knowing their reputation).

They probably can't maintain it themselves either.

It's probably pretty much useless to them if everyone has it.

Not necessary. If you had the source code to FaceBook, most likely you won't be able to do much of it.

The one who is focused on running a business on it - yes, would make a lot of it. Irrespective of who else has the raw code.

That's true, but the whole idea was to enter a market with very little to no competition. You would have the advantage with being unique. However, entering a market with 12 other people with the exact same product wouldn't be ideal.

If someone is interested enough in such a system, they can employ him to branch the project for their needs.

This is a huge F-U move... and what a non-paying (deadbeat) client deserves.

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