"This code is licensed under MIT license with one exception: for 5 years, this license excludes any use
which benefits directly or indirectly the current
owners of UnPayingCompany, Inc. On Aug 1st, 2017, the license for this code is MIT without any restriction."
I think he's doing the right thing by releasing it as OSS. Hopefully he'll pick up some support hours if anyone actually ends up using it.
1) out $6500
2) feeling dumb for getting cheated in the first place
3) feeling bad for having pseudo-publicly excoriated a likely innocent
I wish in retrospect that I had taken the higher ground, open-sourced the code and just moved on.
Don't get me wrong- I think he's totally within his rights to (publicly) exclude him from the license. And as a developer who's been stiffed before, I sympathize. I think the restraint he's shown so far in that README is noble, and I hope he gets some good PR (and thus new clients) out of this.
If you added the proposed restriction, you demonstrate that you will take revenge on deadbeat clients by trying to give their competitors a leg up.