Discovered customer reversed my design now making elsewhere! - Page 1
Forum section: electronics / general

author: SL4P
author_rank: Super Contributor
timestamp: August 13, 2016, 09:56:51 am
content: OK, here's the challenge.About 2010 I designed and coded a PIC based device for a customer.They purchased around 150 units before the company principal had a 'seniors moment', and crashed his company into the ground.The company folded under administrators around 2012, and went silent.Subsequently, his son (having fallen out with father) scraped together the remnants, and formed a similar company.I came across the son again earlier this year, when he asked me to develop a new product... and during the conversation in his office, I noticed what looked like a 'new' version of my original device. I didn't think much of it, as it looked sufficiently different on the outside to ignore at the time..ok, fast forward. He asked if I had a replacement connector to fit a programmer I made for them... sorry none left.That set me thinking...I (casually!) took a closer look at the new controller, and chatted with one of his installer techs.It seems the father and son (before the old company crashed), went out to outsource a reverse-engineered clone if my design! Thy flipped a couple of LEDs, changed from wire tails to headers, but is exactly the same device. AND they flash it withmyfirmware from 2010 - so the design must be electrically identical. It seems they've sold over 1000 units - so I want my piece of that thank you.I've started collecting my brief of evidence - including original design notes, but want any extra thoughts - and recommendations of law firms you know that have experience in this type of action...Location is in Melbourne AU

author: Jay_Diddy_B
author_rank: Super Contributor
timestamp: August 13, 2016, 10:29:18 am
content: Hi,I think this will very difficult to win.The company that you sold doesn't exist, the new company formed by the son, isn't bound by any contract you had with the original company.What did you sell the original company? Did you sell them a design or did you sell them a product? Did you charge them for the design work?I think the best way deal with this, is to stay friendly with the new company and try and profit from them again.Did you have anything in a purchase contract that says that they are only buying your product for resale, not reverse engineering etc? This would be much easier to win.You have to ask yourself, what caused the new company to buy the product elsewhere? Was there anything that you could have done to prevent that.How would you estimate your damages?Regards,Jay_Diddy_B

author: Kalvin
author_rank: Super Contributor
timestamp: August 13, 2016, 10:41:36 am
content: Copying the firmware is a clear infringement of the copyright.

author: Kilrah
author_rank: Unknown
timestamp: August 13, 2016, 11:11:32 am
content: Not necessarily, if they paid for development it could be their property depending on the contract SL4P had (or didn't have) with them.Unless he had a proper licensing agreement, that also stated that the firmware they were supplied with was only licensed for use on original hardware purchased from him it could be hard to enforce anything.

author: sleemanj
author_rank: Super Contributor
timestamp: August 13, 2016, 11:42:52 am
content: This really just comes down to your contract. What exactly did you provide the original company, on what contractual terms did you do so.The original company could not have given away something they didn't have rights to (and ergo the new company can't have said rights if they think they do or not), but similarly you can't claim a cut of something you don't actually have clear rights to control.If your contract wasn't too specific it's very conceivable that the original company thought your development was "work for hire" with copyright assignment to them.

author: macboy
author_rank: Super Contributor
timestamp: August 13, 2016, 02:03:43 pm
content: I agree that you will want to have a close look at the original contract. If they hired you to design and build the device, that is very different than if you had designed it and sold it to them on a per unit basis.Look into small claims court. You will be limited in the amount you can seek, but the costs and therefore financial risk are far less.

author: Rick Law
author_rank: Super Contributor
timestamp: August 13, 2016, 02:59:05 pm
content: Perhaps outdated experience (10 to 15 yrs ago), but may be useful info for you in planning your next encounter; so here goes: (In the USA and in the field of software) Unless otherwise stated in the contract, the expectation:- Paid us to create a brand new product = all intellectual properties yours.- Paid us to customizing a product a product we made = design is ours, source code is ours,- Paid us to customize a product others made = Subject matter yours. Source code yours. Reuse by us for other customer(s) is up to me unless it uses or discloses your subject matter knowledge that is not generally known. The customer signs off on our re-use rights reused before we begin his/her work. Easy concept to explain and easy for the customer to accept: there is only so many way we can do yy/mm/dd+1week in the code, so unless we are using your magic formula or your magic algorithm (ie:customer specific subject matter), it is our call. They do understand that if all our work have blanket no-reuse, we would have to close our doors in a few years because any code we write then will stepping on something we developed for someone before.- Anytime you are want to pay less than I want to charge, we talk it out.- Anytime you want more (such as, no one else can have this for competitive reasons), we talk it out.- If you don't have it (promises) on paper, it is nothing. Better yet, signed paper. We trust you, but things will get hectic and people will forget.

author: Brumby
author_rank: Unknown
timestamp: August 13, 2016, 03:20:58 pm
content: Quote from: Rick Law on August 13, 2016, 02:59:05 pmAlso, having things on paper makes the details explicit, specific and (hopefully) unambiguous.

author: dannyf
author_rank: Super Contributor
timestamp: August 13, 2016, 04:18:28 pm
content: The hurdle for you is fairly high, depending on where you are obviously.You will have to take a look at your contract and see what their obligations are.Pay particular attention to the definition of "firmware": there is a case where a software house produced the software for a mcu. It contains configuration settings in the eeprom (not disclosed to the customer). The customer reverse-engineered the chip and rewrote the eeprom configuration and the ensuing copy is not considered infringement.

author: Seekonk
author_rank: Super Contributor
timestamp: August 13, 2016, 05:50:25 pm
content: Are you sure they flash it with your software? Half of out work was making clones of other work for less. I doubt many would have any interest in copying software if they could. We developed many projects and then they went to others. That's life. It just doesn't seem you made a lot of effort with these people or you were just too small to meet their needs.

author: Zero999
author_rank: Super Contributor
timestamp: August 13, 2016, 05:52:08 pm
content: I agree with the above.Also, note that presumably you got paid for working for them in the past and it was profitable for you to work for them then. Let it drop and maintain good relations with his son's business in the hope of more sales.If things get nasty, then even if you win a legal battle, you may lose more money in the long run.

author: mikeselectricstuff
author_rank: Super Contributor
timestamp: August 13, 2016, 06:03:14 pm
content: One tip - it can be useful to include some hidden behaviour that can be used to show that software has been copied - e.g. on something with a display, some magic obscure button combination to show a copyright notice. Or spit it out a serial port, flash it in morse on a LED etc. Something simple enough that a lawyer can understand.Obviously obfuscate the text so casual browsing won't make it obvious.That way if someone does copy it without permission, and is claiming that they haven't copied your code, you can clearly show that they have done it, and probably won't even need to go to court.

author: Kilrah
author_rank: Unknown
timestamp: August 13, 2016, 06:09:53 pm
content: Another commonly used technique is a custom bootloader. Flash your devices (and read-protect them!) with a bootloader that takes an encrypted firmware image, keep the bootloader file secret and only supply the encrypted firmware files to the customer.The customer can't load your firmware to clones since they'd be missing the bootloader, and if they take one of your devices and erase them they can't go back to stock anymore.The level of encryption security can vary from trivial to super crazy depending on the expected expertise of the customer. I know of a few devices that use this method, and while the encryption is pretty simple it's already beyond the capabilities of the most likely offenders (i.e. would probably be simpler to reverse-engineer and rewrite a firmware than crack the encryption).

author: nctnico
author_rank: Super Contributor
timestamp: August 13, 2016, 06:30:30 pm
content: Quote from: SL4P on August 13, 2016, 09:56:51 amThis ultimately depends on what has been agreed upon between your original customer and you. If you didn't transfer ownership of copyright and agreed to receive a revenue from each device I'm fairly sure you can succesfully sue them for copyright infringement. Copyright law is pretty universal so I guessing it works the same way at the other side of the globe. Still getting a lawyer involved is a good first step. If that proves to be too expensive I'd just go over to talk and say you want the son to honor the previous agreement and that they are violating copyright.

author: CatalinaWOW
author_rank: Super Contributor
timestamp: August 13, 2016, 08:59:45 pm
content: This is also some time for serious self appraisal. If your work was, and will be, pedestrian, something that any trained engineer could do you will do far better to swallow your pride and maintain good relations with the new company. If you don't, they also will go bankrupt and only by luck or intense effort will you find where they pop up again. You will be left without the new job and with no additional compensation for your past work. Wherever they pop up they will be able to find engineers to do what they need.If you are a truly superior engineer, and the work was something not many other than you could do it might be worth fighting for. But if you are that good you probably have better ways to line your pockets than by sharing with a pack of lawyers.

author: SL4P
author_rank: Super Contributor
timestamp: August 13, 2016, 09:27:03 pm
content: All interesting comments. To address several points...I specifically didn't pass source code or hardware design to the customer. In writing!Their need to re-flash was based on a requirement for several variants of timing for their application.No UI - literally - other than a 433MHz RX, and 4 relays.They are cheap bast*ards - both father and son. They are using the programmer and binaries I provided in someone else's hardware. Their tech told me exactly this, and how/when they went searching for a Chinese reverse engineering house.This was one of four products I developed for them back in the 00s - with a specific clause regarding non-transfer of IP on SW and HW design.Thanks for the thoughts.I'm still considering the small claims path... we're talking 30k or more in losses.

author: Kilrah
author_rank: Unknown
timestamp: August 13, 2016, 09:27:16 pm
content: Quote from: CatalinaWOW on August 13, 2016, 08:59:45 pmIn the case as described it could well be the opposite i.e. maybe the hardware was simple but the complexity and cleverness of the product i.e. the engineer's value was the software, and that's why they copied it instead of redesigning it because that would have been too difficult.In any case I would NOT want to further deal with someone who didn't recognise the value in my work and thinks it's OK to copy it. If that's how it is, you can be sure they'll never pay you what you're worth for any future work, better go see elsewhere.I would attempt to clarify the matter before giving up on them in case they genuinely made a mistake they didn't think they were doing, but with little hope. The fact that they let the company go down and started a new one makes it pretty obvious they did so to get away with any remaining debts and try to sneak their way out of existing contracts, not that they intend to have sane long-term relationships with their partners.EDIT: OP just confirmed they're the kind of people you just don't want to work with unless you really have no other option.

author: AR
author_rank: Contributor
timestamp: August 13, 2016, 09:33:52 pm
content: Hello SL4P,One thing thing you have to be careful of is that your legal fees can become greater that what you are owed. So you have to think very carefully about what you think you are owed and balance it with legal costs. I am not an expert in this area but you need to make sure you are across this problem, and factor that in.I would start with some talking to the son and see if you can sort it out.

author: IanB
author_rank: Super Contributor
timestamp: August 13, 2016, 09:52:42 pm
content: Quote from: SL4P on August 13, 2016, 09:56:51 amQuote from: SL4P on August 13, 2016, 09:27:03 pmThere is a moral and ethical question here about the origin of the device. You said you "designed and coded it for a customer". The question would be whether they paid you to do that work or whether you designed it at your own cost and then sold devices to them on a per unit basis.Because seriously, if you did the design and coding specifically for that customer, at their cost, then the design is bought and paid for by them and morally it is theirs to do with as they wish.If you wrote in the contract that you wouldn't pass the source code or design to them then they were owed some form of compensation for that in the form of a discount or being charged less than market rate for the work.This is something for you to think about as you have not shared all the details. But often there are two sides to a story.

author: nctnico
author_rank: Super Contributor
timestamp: August 13, 2016, 10:03:44 pm
content: Quote from: IanB on August 13, 2016, 09:52:42 pmThat is a very common misconception about copyright! Also copyright is something which most courts take very seriously so SL4P is quite likely to get the company who uses his software without a license to pay for the license fees.

author: IanB
author_rank: Super Contributor
timestamp: August 13, 2016, 11:19:45 pm
content: Quote from: nctnico on August 13, 2016, 10:03:44 pmIt is not quite the misconception you suppose. It depends on whether the software was produced as a "work for hire" or not. For example, under U.S. law, if I engage you to write some software for me, I provide the specification for the software, I pay you to write that software under my instruction, and I determine when and how you deliver that software to me, then it is I who will generally hold the copyright in that software, not you.The law in other jurisdictions is probably similar.

author: SL4P
author_rank: Super Contributor
timestamp: August 13, 2016, 11:25:05 pm
content: Two questions arise -I wrote the spec, as the customer wasn't capable of stringing two paragraphs together... they approved what I wrote. Who owns the spec?The hardware was designed and developed by me to meet that functional spec which I wrote. Who owns the copyright on the implementation?

author: Zero999
author_rank: Super Contributor
timestamp: August 13, 2016, 11:33:31 pm
content: Another possibility is the software may not be subject to copyright at all. Copyright doesn't cover ideas, algorithms or processes. There are only so many ways to code something and if it's just implementing an algorithm then it may not be copyrightable in the first place. This is more likely if it's very simple.See LEXMARK INTERNATIONAL, INC. v. Static Control Components case linked below:https://scholar.google.com/scholar_case?case=16859592332175262551

author: IanB
author_rank: Super Contributor
timestamp: August 13, 2016, 11:36:54 pm
content: You designed a Thing. Who paid you to produce that design? Did you do it on your own time, or did you do it on your customer's time? If you were paid for the time spent writing the specification and subsequently producing the design, then the customer is morally the owner of what you designed. They paid for it, they own it. You shouldn't get two bites of the cherry.

author: AR
author_rank: Contributor
timestamp: August 13, 2016, 11:37:00 pm
content: Hello SLP4,On legal costs in Melbourne (City Lawyers) the cheap end for a good lawyer from a descent Law firm is AUS $400 per hour and it goes up from there. Court costs etc cost extra and are on top of this hourly rate.

author: Jay_Diddy_B
author_rank: Super Contributor
timestamp: August 13, 2016, 11:42:02 pm
content: Hi,Did you have a contract or statement of work?What did your invoices say?What did you sell them?The contract is the most important documentThe copyright on specification only matters if they shopped the specification around to get somebody else to code the software. You are telling us that they are using your binary files on hardware made by a third party.Did you ever supply the hardware?Regards,Jay_Diddy_B

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 12:16:26 am
content: No two bites.Just looking for a return on the effort, which no-one else put in.I wrought a return on 150 units while someone else took the cream off 850 units.

author: AR
author_rank: Contributor
timestamp: August 14, 2016, 12:18:16 am
content: Hello SLP4,>>I'm still considering the small claims path...If your talking about VCAT remember this is not a court of law its a tribunal.

author: IanB
author_rank: Super Contributor
timestamp: August 14, 2016, 12:45:50 am
content: Quote from: SL4P on August 14, 2016, 12:16:26 amOK, but you are still not being clear about who paid for the original design. If you designed the unit in your own time without payment by the customer, and sold the units to them on a per unit basis, then it is reasonable that you own the design. But if they paid you for your time to do the design, then they have a reasonable claim to own what they paid you to do for them.

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 12:50:07 am
content: Quote from: IanB on August 14, 2016, 12:45:50 amI need to look back to check my docs, but I recall this was done on a 'reward for sales' basis.So the IP was mine, not paid for by the customer up front.Thanks - I'll go looking.

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 01:18:36 am
content: Quote from: blueskull on August 14, 2016, 01:10:28 amThe absolute inter-dependence of FW and HW designs close the gate a bit.Quote from: blueskull on August 14, 2016, 01:10:28 amIt's a bit more, with programmable sequencing, RC servo integration and a few other features beyond a relay controller.discussion.

author: dannyf
author_rank: Super Contributor
timestamp: August 14, 2016, 01:45:11 am
content: QuoteIf they did reverse engineer your code and flashed their products with the reverse engineered code, you have no case for infringement.You may sue them for unauthorized disclosure of your IP rights if your contract with them had a NDA provision in it.I would suggest that you consult a lawyer, a good IP lawyer. Based on what I have heard so far, you have little chance coming out on top through a lawsuit.

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 01:49:38 am
content: Quote from: dannyf on August 14, 2016, 01:45:11 am

author: T3sl4co1l
author_rank: Super Contributor
timestamp: August 14, 2016, 01:53:15 am
content: Sounds like you have a good case for licensing at the very least.Tim

author: Geoff
author_rank: Contributor
timestamp: August 14, 2016, 01:55:50 am
content: Hi SL4P,What would you do different today to avoid being in this situation again?

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 01:57:27 am
content: Quote from: Geoff on August 14, 2016, 01:55:50 amBe a bastard, and not treat them like friends.Full retail from day one - like it or not. I enjoyed the project at the time, but the aftertaste is like a bad hangover.

author: dannyf
author_rank: Super Contributor
timestamp: August 14, 2016, 02:06:02 am
content: QuoteI would say that in general, don't get in bed with people with questionable ethics.With that said, think about your business model first. If I were to do something like that, I would ask for a payment for the code and they can flash as many times as they want.If I were to take contingency (I have never done that, ever), I would prepare myself for a few things:1) I would enable code protect;2) I would only write for a target with unique identifiers;3) I would need a few mechanisms to authenticate the code, or even validate the code;4) I would implement some mechanisms for user notification, performance hit, or "bugs".5) I would definitely provide a way for the users to upgrade the firmware for more features: you want to obsolete the code as soon as possible....End of the day, rest assured that if someone wants to crack your code, they can. All you can do is to delay the inevitable and deter their incentives to do so.

author: all_repair
author_rank: Frequent Contributor
timestamp: August 14, 2016, 03:12:17 am
content: My premise is customers shall walk off with what they can. They shall pay for my value-add only. I shall put in protection that cost me according to the situation, and if at the end the customer still choose to, and manage to steal, then either I have misjudged or they are clever than I have thought, or they have misjudged.When it happens, as there was no trust at the beginning so there was not much anger.There was a maintance contract (about 700k USD over 2 years) that I put in some protection. When I detected the client was going to walk off on me, my mode was not after the 700k but in protecting myself if the client could not deliver to their customer and ended up I got sued. There was a life being lost. I do not not know should I take responsibility. The work involved tower. While they tried to crack my work, one of their tech fell down.There was another one that I totally misjudged. It was an equipment we designed and built for a government department and sold at cost so to sell more in future. I did not expect a government department here could encourage theft so they could get something cheaper for themselve. As I have more clients than time, I chose to spend my time not with this client any further. But if the choice to me was to dance further with the same client then I would try to milk my past lost profit from them in the future work. They shall pay for the value they think is worth paying.

author: donotdespisethesnake
author_rank: Super Contributor
timestamp: August 14, 2016, 09:34:22 am
content: I know fellow consultants who have been ripped off by customers. It really sucks, but in practice there is not a lot to do apart from never do business with them again. In one case, even after a consultant sued, and won, the customer claimed hardship and paid the damages in instalments for a few months then stopped. To enforce the judgement would have taken more time and money, so he gave up.Hardware has no copyright protection, so it hinges around the original contract and whether those rights are transferable etc. Software probably has copyright protection by default, so there may be better grounds there.However, lawyer fees and costs will quickly eat up $30K. So worth a try with a small claim and some formal letters, and hope they settle quickly or you get a favorable judgement. If not, I can't see it worth pursuing further action.

author: wraper
author_rank: Unknown
timestamp: August 14, 2016, 10:02:55 am
content: Quote from: blueskull on August 14, 2016, 01:10:28 amIf it is custom built low volume product (like this one) and not something generic made in 10-100s of thousands with the cheapest parts possible, then absolutely. Even just outsourcing the assembly for 150 pieces will cost almost half of that.

author: XOIIO
author_rank: Super Contributor
timestamp: August 14, 2016, 10:25:56 am
content: Destroy them.

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 11:03:44 am
content: Just so you know why I'm frustrated.To get the product up, I invested in the surface mount tooling etc before the first 150 boards were made. Based on the low unit price, that probably ate up half of the my net profit from the startup phase with expectations of forward sales.There was no negative conversation, they are obviously happy with the design and operation - and they had to pay those startup costs again for no advantage.It was just the old man's anger at his own incompetence. I think the son is simply naive, and stole the new product from dad's inventory before the foreclossure of fathers factory.Just tight-arses.

author: mikeselectricstuff
author_rank: Super Contributor
timestamp: August 14, 2016, 11:10:39 am
content: I think you just need to write it down to experience. I doubt it's viable to recover anything legally - only the lawyers win.If you want to piss them off, open source the design or offer it to a competitor.Then move on to sometheing new.

author: Ian.M
author_rank: Super Contributor
timestamp: August 14, 2016, 11:41:00 am
content: You could try asking them if they want to work with you in the future developing products exclusive to their geographic area and industry, in which case an agreement on royalties for the use of the existing firmware will be needed, with a schedule for payment of back-royalties (or double the royalty on the next 1000 units based on that firmware or any derivative of it), or whether they would prefer it if you black-list them for future work, offer your existing design and firmware that they have been using to all their competitors and take legal action to recover appropriate royalties and damages. Talking to them with your lawyer present is a *LOT* cheaper than going to court.

author: PChi
author_rank: Frequent Contributor
timestamp: August 14, 2016, 11:46:04 am
content: There is a risk that if you managed to get a court ruling in your favour and penalties were imposed the son could just fold the company and walk away. They have previous.

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 11:48:38 am
content: Folding is a reality, and I have nothing to lose if I can't do this without spending $$Father already has more than a million hanging over his head from the bank default.Ian M - yeah, that's generally the idea I've been leaning.I have so much dirt on them now, and evidence to back it up, as well as knowledge of assets they've hidden from the receivers - I have to stop short of 'blackmail', but make them aware I want what's mine!

author: Ian.M
author_rank: Super Contributor
timestamp: August 14, 2016, 12:00:51 pm
content: I would say that future product configuration should either be by jumpers, or by loading just the EEPROM. Firmware should be protected, serialised and loaded by the MicrochipDirect programming service on your behalf, drop-shipping to your client. Include an 'easter egg' mode that pulses out the version, serial number and firmware checksum on one of the LEDs as fast as can be reliably captured by a phone camera for future verification of whether an example of the product is legit or a clone - if you find two with the same serial number you know you are being ripped off again.Unfortunately that means you get the hassles of having to manage the MCU ordering, but that's no worse than if you were dealing with a shady Shenzhen assembly plant.

author: dannyf
author_rank: Super Contributor
timestamp: August 14, 2016, 12:55:03 pm
content: Quoteclaims against the previous company (its estate, more precisely) has no value.claims against the new one may make more sense, but you don't have a contract with the new company unless they bought the design from the estate.

author: SeanB
author_rank: Super Contributor
timestamp: August 14, 2016, 01:11:33 pm
content: If you have evidence of them hiding assets then simply go see the Receiver of Revenue ( but make sure your returns are absolutely up to date, clean and totally legit first) and do some talking anonymously. They tend to offer a reward of a percentage of the recovered amount, and a cash bonus, for this.Only downside is the fact that for the next 5 years your return will be audited by them, so make sure all the supporting documentation is both correct and backed up well.

author: batteksystem
author_rank: Regular Contributor
timestamp: August 14, 2016, 01:19:58 pm
content: Quote from: SL4P on August 13, 2016, 11:25:05 pmThe question is not what you designed for them, the question is what you sold them. If you don't sold them the firmware and they copy it, then there is a possibility that you can prove it and claim damage. However, given the small amount (30K AUS, I don't think it is worth going over court case, could be many times more than that)On the other hands, using only the binaries mean when they copy they have no way of improving the product without chucking out a new firmware.

author: batteksystem
author_rank: Regular Contributor
timestamp: August 14, 2016, 01:25:08 pm
content: Quote from: batteksystem on August 14, 2016, 01:19:58 pmDevice in discussion?http://www.sl4p.net/SMSbox_User_Guide.pdf

author: JoeO
author_rank: Frequent Contributor
timestamp: August 14, 2016, 01:47:46 pm
content: SL4P: How many units have you sold?

author: IanB
author_rank: Super Contributor
timestamp: August 14, 2016, 02:25:22 pm
content: Quote from: batteksystem on August 14, 2016, 01:19:58 pmWhich comes down to who paid for it? For example, if the customer was billed for the hours spent writing the spec and doing the design, then a case can be made that it was a work for hire and the customer would own the work product.I have worked on many consulting projects where the customer is billed for the work performed, and invariably the contract says that we will deliver to the customer all of the original work we produce for them under that contract: software, design calculations, analysis, reports, documentation and so on. The customer's lawyers would be negligent if the contract didn't stipulate that.

author: Kjelt
author_rank: Super Contributor
timestamp: August 14, 2016, 02:44:32 pm
content: Just a sidenote: we had an infringement a 1:1 copy of our hardware and software into a clone product.Still we did not sue because the costs of suing could end up well over 6 figures and take many years, while if the judge in the end would give us 30% of all the profits made by that company it would not have covered these costs.There are a lot of people that want their right and they have their right but you can not get it in court due to the rediculous >$250/hr costs of lawyers, you could try to scare them with an official letter from your lawyer hoping they would settle, but actually going to court, i would think twice (unless it is different in australia (cheaper lawyers, faster courtsystem etc.))

author: SeanB
author_rank: Super Contributor
timestamp: August 14, 2016, 06:23:59 pm
content: Quote from: batteksystem on August 14, 2016, 01:25:08 pmIf it is that device then the problem will be solved in a short while, as most phone carriers are changing systems, so the older ones will simply stop working on many networks without a firmware and possibly a modem upgrade.

author: nctnico
author_rank: Super Contributor
timestamp: August 14, 2016, 07:41:40 pm
content: Quote from: SL4P on August 14, 2016, 12:50:07 amI never ever do this! I've learned my lessons. Even if I get to supply the products or boards I expect the customer to pay for the development entirely. After all I can't sell or market the design; the customer is supposed to know the market and how much they can sell and base a R&D budget on sales projections. Why should I take a risk and depend on someone else's sales efforts?

author: SL4P
author_rank: Super Contributor
timestamp: August 14, 2016, 09:54:43 pm
content: Quote from: SeanB on August 14, 2016, 06:23:59 pmNo. Sorry. Not that one!ControlMate is already using a3G chipset, it was developed specifically to get past the 2G phase outThat is mine, and the code ain't going anywhere!BTW. a few major improvements in functionality - coming at the end of August.- More, mixed day timers.- All timers/mapped/button/dial functions may now use *any* valid controller command- and more...

author: ez24
author_rank: Super Contributor
timestamp: August 14, 2016, 11:45:06 pm
content: May I suggest you draft a letter to them, outlying why you think they owe you money. Make it as legalese (but clear) as you can and make an offer to settle (for example you think they owe you 30k but you will accept 10k). Then find a lawyer to put his name on his letter head. You can explain to the lawyer you do not have the money to pursue the issue and all you want is a letter (you have to write it). Offer him $500. I got a letter once this way. Try to write it so a third party can understand it. Then if you go to small claims you will have something in writing that you were willing to settle and they refused.

author: Aodhan145
author_rank: Frequent Contributor
timestamp: August 14, 2016, 11:52:09 pm
content: How many hours did you spend on making it? I wouldn't loose to much sleep about it use your time and make a new product for a different company. Thats much more productive than wasting time suing them.

author: EEVblog
author_rank: Unknown
timestamp: August 15, 2016, 12:10:31 am
content: Quote from: Jay_Diddy_B on August 13, 2016, 10:29:18 amYes, it's called Pty Ltd for a reason, limited liability.But that doesn't stop you from pursuing action against them if they have copied your code.BUT, you are almost certainly better off just walking away from it all, it almost certainly won't be worth your time and effort. Move onto bigger and better things.

author: Kilrah
author_rank: Unknown
timestamp: August 15, 2016, 08:16:57 am
content: Well, you have a device that's intended for their target market and apparently have all the rights to use/sell it, so if you really want to hit hard you could do something like... prepare yourself to build some units again, make a little webpage, put the device on sale there for 20% cheaper then they sell for, then send a newsletter out to some of their biggest potential clients... including their new company in the recipients.If they dare responding tell them you can stop selling units directly if they settle the estimated $30k first and agree to buy every future unit they sell from you again, if not you can probably recoup your investment through the sales and kill them in the processIf the situation is as it seems to be, the chances they could get to you legally for that are as slim as you recovering your investment through legal means.

author: SL4P
author_rank: Super Contributor
timestamp: August 15, 2016, 08:21:30 am
content: Tis issue came to a head today when he called me - asking for a favour. I declined, and he asked 'Why?'ME: We need to sort something out.This afternoon - I went back into my archive - and found two incriminating paragraphs...Original start-up agreement --When the company was folding - they asked me for this -Warranty & repair - ok... but reverse-engineering & cloning - I don't think so.(p.s. They were never given the C-source!)

author: Kilrah
author_rank: Unknown
timestamp: August 15, 2016, 08:37:54 am
content: Excellent timing!

author: EEVblog
author_rank: Unknown
timestamp: August 15, 2016, 08:46:37 am
content: Quote from: Kilrah on August 15, 2016, 08:16:57 amI give this idea a big fat

author: SL4P
author_rank: Super Contributor
timestamp: August 15, 2016, 08:54:08 am
content: The poll results at the top of this thread are quite interesting...Maybe I'm not the only one with bad experiences!!

author: Galenbo
author_rank: Super Contributor
timestamp: August 15, 2016, 09:39:07 am
content: Quote from: SL4P on August 13, 2016, 09:56:51 amI assume you don't already have a lawyers department in you company, If you don't plan to have one, let go the "legal" dimension of the case, but collect the REAL evidence and keep it safe.I guess you were payed for the work you did back then, so use your talents for the things you like, and the things you're good at. Design an even better or another product.AND in your references: Mention you're the designer of THEIR 150+1000 products, USE their copy-efforts for your own. Whenever they don't like that, let THEM prove it's NOT your design.I don't know your industry, but I would develop a V2.43 firmware that would be "better" for some reason. And offer it for FREE. And let their customers indirectly know it's available and useful. Even full compatible for their copied products. They don't really know what is going on, but they will continue to see you as a source. Stay connected to their market.

author: FreddyVictor
author_rank: Regular Contributor
timestamp: August 15, 2016, 10:09:48 am
content: Quote from: mikeselectricstuff on August 14, 2016, 11:10:39 amGood idea !Ofcourse OP could threaten this to leverage some sort of settlement

author: batteksystem
author_rank: Regular Contributor
timestamp: August 15, 2016, 10:33:14 am
content: Quote from: SL4P on August 15, 2016, 08:21:30 amI would say you have a strong case here with black and white agreement. The fact that you haven't sign anything with the new company actually make your case stronger - the new company shouldn't be able to use any hex you provided to them unless you have the new agreement with new company. The only difficulty I see is proving they are using your hex.

author: SL4P
author_rank: Super Contributor
timestamp: August 15, 2016, 10:45:42 am
content: Quote from: batteksystem on August 15, 2016, 10:33:14 amI have this inwritingfrom the son - a week ago.(He genuinely doesn't see what's wrong with them using my IP !)Still mulling my options. Most likely go for a one-time settlement that is (possibly) affordable to them. 50% of the lost profit on the 1000 devices (i.e. around $15K) paid in one shot with a written settlement.They can't complain, to defend it will cost them more than that, and I'll have to walk away.

author: all_repair
author_rank: Frequent Contributor
timestamp: August 15, 2016, 10:46:57 am
content: Quote from: Kilrah on August 15, 2016, 08:16:57 amLast resort I think. Doing it y ruin your reputation.Try to achieve win win. Other people may not know the details or want to know the details, but shall know that you are selling what you were asked to design.Is it profitable for them? Are they running not at profit selling the devices? Is the cake big enough to share around? If it is not, fighting for the share of same small cake create not much value. Go for one that has a bigger cake, or try to grow the cake bigger and bigger. The problem maybe the cake is just too small from the beginning.

author: CJay
author_rank: Super Contributor
timestamp: August 15, 2016, 01:28:43 pm
content: Easter egg in the code so it spits out a specific pattern, lodge design files with a lawyer in a sealed form so if you need to go to law in the future you can pull the files and prove they ripped off your code.Programming by license, supply a programmer device like (or exactly) a TEAClipper that holds encrypted HEX files and every time they're programmed it knocks a prepaid token off so they can only program a fixed number before having to pay again to receive a 'full' programmer.Chalk it up to experience and unless you can get the new company to agree to a license that ensures you receive your payments then refuse to deal with them.One nasty that springs to mind though, if the device isn't covered by license and the contract was with a defunct company, could you sell the product yourself for less than them?

author: IanB
author_rank: Super Contributor
timestamp: August 15, 2016, 01:33:42 pm
content: Quote from: SL4P on August 15, 2016, 08:21:30 amI still see a very one sided view throughout this thread. It remains that if you wrote the software in the prototyping stage on their dime, it means they employed you to write that software, which means it is their software to do with as they wish. Legally, morally and ethically, when you do a work for hire, the rights in that work are assigned to the person who hired you. You cannot charge someone for a thing and yet still retain ownership of that same thing.

author: SL4P
author_rank: Super Contributor
timestamp: August 15, 2016, 01:49:00 pm
content: IanB - I certainly get what you're saying - and I originally wrote that top para in hope of heading off a situation like this by 'reminding them' of whose rights are whose - because I knew at the time they were not the sharpest knives in the block... but never imagined they'd go so far out of their way to screw me - without even saying asingleword.To me, it was excruciatingly difficult dealing with them, because 'feature creep' was their mantra, and as soon as I showed them any functionality - they wandered off and realised they'd forgotten to mention something fundamental to the device! That's why I had to write the requirements/spec, and unfortunately, I created the terms I worked within - despite the fact they had no idea what was being said!I expect they would've been paying the same or more in China if they bought the same quantities as they did from me (I gave then a great deal) - but instead of giving me the business - they went and ordered many, many more from someone that didn't have to put any effort in. Fuc* them!

author: IanB
author_rank: Super Contributor
timestamp: August 15, 2016, 02:17:02 pm
content: Which is why, in a consulting business, it is imperative to get paid for your work at full value at the time of execution. If you offer a fixed price for an open ended job, you are going to lose. If you offer a discount up front in the hopes of amortizing the loss in future sales, you are going to come out behind.Lawyers have the appropriate model. They bill at an hourly rate for the work they do. If you ask them to do more work, you have to pay them for more hours. If you decide to walk away at any time, the lawyer has received full value for the work up to that point and has lost nothing.This also means, in fairness, that if the client has paid you full value for the work performed; they owe you nothing more. Your work product is theirs to do with as they wish. If you stop the relationship at any time you are both happy and there are no recriminations.

author: Ian.M
author_rank: Super Contributor
timestamp: August 15, 2016, 02:30:30 pm
content: Quote from: IanB on August 15, 2016, 01:33:42 pmThat's a very USA centric viewpoint. Copyright law in most Commonwealth countries differs considerably from copyright law in the USA. Unless there was undue duress, or the contract fundamentally conflicts with Australian copyright law, the legal, moral and ethical choice is for both parties to follow the contract as closely as possible with all departures from it by mutual agreement. Even under USA law it is doubtful that work performed by anindependentcontractor (not one of your 'fake' ones that works alongside employees in an indistinguishable fashion) would be a "work for hire" unless it was contractually agreed to be so.SeeAnalysis of International Work-for-Hire Laws - Sutherland AsbillandAustralian COPYRIGHT ACT 1968N.B. IANAL.

author: nctnico
author_rank: Super Contributor
timestamp: August 15, 2016, 02:48:06 pm
content: Quote from: IanB on August 15, 2016, 01:33:42 pmPlease skip the 'Legally' in the above because it simply isn't true! As I wrote before this is one of the biggest misconceptions when people pay independant companies/contractors to create software for them.

author: boffin
author_rank: Unknown
timestamp: August 15, 2016, 02:59:43 pm
content: Quote from: CJay on August 15, 2016, 01:28:43 pmI think the only thing that has to be proven is that the rights of the code/design wasn't passed [to the old company].If you really want to scare the crapola out of them you need to file a small claims court case against everyone you know USING the product, not just the [new/asshole] manufacturer. When their customers realize they could be on the hook for copyright infringement...

author: woodchips
author_rank: Frequent Contributor
timestamp: August 15, 2016, 03:02:37 pm
content: A bit of a side question.It uses a PIC, that has protected code. Why not supply preprogrammed devices to them at a suitable rate, then they have no need for the source or hex files? That was the route I took in the very few occasions I did software for others.The side question is, is the code protection in the PIC safe? Apparently being electrically stored, EPROM or flash, then you can't shave the lid off and read the stored bits? I think.

author: CJay
author_rank: Super Contributor
timestamp: August 15, 2016, 03:23:27 pm
content: Quote from: woodchips on August 15, 2016, 03:02:37 pmDepends on the value of the product, microcontroller code is *always* recoverable, it's just a matter of how much money you can afford to throw at the problem.There a reo companies out there that make a nice profit offering code recovery services to anyone willing to pay.

author: CJay
author_rank: Super Contributor
timestamp: August 15, 2016, 03:27:57 pm
content: Quote from: nctnico on August 15, 2016, 02:48:06 pm7I'd even go as far as skip the morally and ethically too, it really depends on how the terms of the contract were written doesn't it?

author: Ian.M
author_rank: Super Contributor
timestamp: August 15, 2016, 03:48:28 pm
content: Few MCUs not designed for cryptographic applications are actually secure.The techniques of decapping microprobing, and removing selected interconnects so the MCU will read back its whole program memory while executing forced NOPs are well known and within the capabilities of an extremely dedicated hobbyist.There are plenty of companies that claim to be able to recover the firmware from most MCUs including PICs, given three identical samples. Of course, they operate in jurisdictions that have lax copyright laws, and may not deliver the service they claim to, even though many offer to provide a cloned copy of the chip as proof they have recovered the firmware before final payment, typically of a four figure sum.However precautions like chips supplied with protected preloaded firmware, and encrypted individual serial numbers that can be queried without dismantling the product and without special tools go a long way to bias the risk:reward ratio in favour of honesty, especially if the device has any sort of comms capability, such that cloned serial number devices can be blacklisted.

author: IanB
author_rank: Super Contributor
timestamp: August 15, 2016, 04:01:44 pm
content: Quote from: nctnico on August 15, 2016, 02:48:06 pmIt does not seem as simple as you imply, and apart from specifics of jurisdictions it apparently depends also on the difference between an employer/employee relationship and an independent contractor relationship (which might not be black and white), whether there are contract terms that supersede the default interpretation of the law, and in some jurisdictions on whether the work is software or not (software is more likely to be owned by the employer).Let me quote from the first document linked by Ian.M above:Quote

author: nctnico
author_rank: Super Contributor
timestamp: August 15, 2016, 04:30:14 pm
content: An external contractor isn't an employee!From the NL court cases I have studied the requirements for being regarded like an employee is when the instructions for making the work and HOW to make the work are provided by the client and are also very detailed (which tools to use, how to use the tools). Also working on the premises of the client and using the client's resources leans towards being regarded an employee when it comes to the question about who owns the copyright. BTW a (functional) specification doesn't count as detailed instructions. The default in copyright law is that a work is owned by the creator.

author: IanB
author_rank: Super Contributor
timestamp: August 15, 2016, 04:42:55 pm
content: Quote from: nctnico on August 15, 2016, 04:30:14 pmWhich is why the terms of any contract are very important, both for the customer and the contractor.I'm just looking for a little balance in this thread, which seems very one sided. Everyone is like "Oh, the customer is out to screw us!", but nobody is recognizing the other point of view, which may be "Oh, the contractor is out to screw us!"

author: Kilrah
author_rank: Unknown
timestamp: August 15, 2016, 05:42:18 pm
content: OP has posted contract terms that make it unambiguous.

author: CatalinaWOW
author_rank: Super Contributor
timestamp: August 15, 2016, 06:35:44 pm
content: The first quoted contract paragraph makes it clear that you retained ownership of the software. Future negotiations to resolve royalties issues are mentioned but this paragraph makes no mention of resolution.The second paragraph identifies a request for source and binaries, identifies the purpose as warranty and repair work, but says nothing about the terms under which this was delivered. Did you deliver them? Did you make no request for compensation? Could your delivery be interpreted as a donation or gift? You will have to have answers for these questions before you can get anything out of this.

author: macboy
author_rank: Super Contributor
timestamp: August 15, 2016, 06:40:31 pm
content: Australia is based on Common Law, AFIAK. Therefore you may be able to register a lien against the company using your rights under common law. If they are as lazy and selfish as you say, they may ignore your action, in which case after 30 days it will become legally settled in your favor (your statements become truth according to Law). Or they may try to rebut your claims. I am not a lawyer, and I don't know the Australian legal system. This is just something I came across once upon a time.http://lien.fmotl.com/

author: rrinker
author_rank: Super Contributor
timestamp: August 15, 2016, 08:53:37 pm
content: It's been hit upon above, an independent contractor is NOT the same as an employee. As pretty much the only person with programming experience in my consulting company (usually we do Windows server stuff, Cisco infrastructure, VMware, and EMC stuff), when we've had a programming project here or there, it is explicitly written in the contract who will retain ownership of the software, my company or the client (never me, I am a full time employee of this company and anything I come up with while working here belongs to them. My model railroad electronics and Arduino and other micro code I develop at home on my computer using my electronics workbench, that's 100% mine). Just because the client pays us does not automatically make it their software, this si something that is agreed upon as part of the contract. We've done maybe 4 projects over the years, and it's been 50/50. The two largest ones, where there was considerable time, effort, and money spent have gone tot he client with all source code and documentation. They have in one case done some modifications on their own but also have called us (me) back in to make changes as well. The other two were short duration projects which we have retained ownership of and have not given away source code - in fact one of the programs got some minor tweaks and was used for another client who had a similar need.

author: SL4P
author_rank: Super Contributor
timestamp: August 15, 2016, 10:05:36 pm
content: Quote from: woodchips on August 15, 2016, 03:02:37 pmYes indeed a PIC.The reason I left (several versions of) HEX with them, was each device could be installed in a slightly different application - with different operating parameters, and there was no interface or UI to set/modify them.

author: nctnico
author_rank: Super Contributor
timestamp: August 15, 2016, 10:17:08 pm
content: Quote from: SL4P on August 15, 2016, 10:05:36 pmOne of the standard things in my designs with a microcontroller is a couple of option jumpers.

author: SL4P
author_rank: Super Contributor
timestamp: August 15, 2016, 10:19:38 pm
content: Quote from: nctnico on August 15, 2016, 10:17:08 pmAlready had several (calibration mode etc) - otherwise I would have had more jumpers than pins! (figuratively speaking!)Device was installed in a high-vibration environment - jumpers not always suitable.

author: dannyf
author_rank: Super Contributor
timestamp: August 15, 2016, 11:11:03 pm
content: Unusually contracts have provisions that prevent the developers from reusing the development for any work unauthorized by the party that contracted the original development for obvious reasons.Even if your contract doesn't contain such a provision, it is ethically and reputationally a bad thing to do, in my view.I would suggest that you talk to a real lawyer, not those who play lawyers on a tech forum, about your options.It will help ground you in reality and it will be money well spent.

author: nctnico
author_rank: Super Contributor
timestamp: August 15, 2016, 11:13:11 pm
content: Quote from: dannyf on August 15, 2016, 11:11:03 pmWhy would it be? You are using libraries for the software you create aren't you? Writing everything from scratch for each customer makes no sense at all.

author: ez24
author_rank: Super Contributor
timestamp: August 15, 2016, 11:36:43 pm
content: Quote from: dannyf on August 15, 2016, 11:11:03 pmSue for a million and settle for a beer.

author: Rick Law
author_rank: Super Contributor
timestamp: August 16, 2016, 12:04:57 am
content: Quote from: rrinker on August 15, 2016, 08:53:37 pmYou can keep the stuff you do at home, so you had it pretty well!In my case, when I was working in the software arena (long ago, Dinosaurs probably were roaming in the back-woods still). It was one of the 7 dwarfs, a computer firm with a consulting arm. Stated in the employment contract: all my work belongs to the company - even those done during off-hours and off-premise at home. Doesn't matter, they own it all. In the employment contract, it also stated that I am not free to publish except with permission. When I do, they get the royalties since it would likely contain experiences gained from work.To makes sure all was fair, I had to bring in a list of my publications (I had three) within the first weeks of employment. I got to keep royalties from those.

author: IanB
author_rank: Super Contributor
timestamp: August 16, 2016, 12:06:53 am
content: Quote from: nctnico on August 15, 2016, 11:13:11 pmIt's not about writing everything from scratch, since using existing libraries obviously makes sense from a cost and quality perspective. However, if you do write specific code uniquely for the customer to meet their requirements, where they are paying for your time spent doing so, then you should assign that part of the code over to the customer. It's only fair and reasonable, since they paid for it.Similarly, if it got around that you took some work commissioned and paid for by a customer and started reselling it to other customers, your reputation would not look very shiny to say the least.

author: dannyf
author_rank: Super Contributor
timestamp: August 16, 2016, 12:36:43 am
content: QuoteThat's just MAD: mutually assured destruction. The only winner here will be the lawyers: you can easily think it through and understand why that's not a terribly desirable strategy.I would say that had the OP had some foresight, he would not have started this thread. Should there be a lawsuit down the line, the other side will do research on him/her and this very thread will pop up.In life, it pays to think a couple more steps ahead, not just what's under your nose.

author: batteksystem
author_rank: Regular Contributor
timestamp: August 16, 2016, 01:08:43 am
content: Quote from: dannyf on August 16, 2016, 12:36:43 amNo lawyers involved in selling your own products to their customers, although the strategy of driving the selling price to cost do not is surely not a sound one. It is the exact opposite of the win-win situation.

author: alanb
author_rank: Frequent Contributor
timestamp: August 16, 2016, 09:02:57 am
content: The fact that the Son/New Company want you assistance is helpful, providing that you can charge for your help at a rate that is equal to or greater than you would earn on other projects for your time, it is worth doing.Forget trying to recover the money for the design etc regardless of whether you are legally and/or morally right. Your chances of actually receiving the money is minimal, the new company probably is short of cash and would go down the pan like the previous company if they lost a case forcing them to pay.

author: CJay
author_rank: Super Contributor
timestamp: August 16, 2016, 09:07:46 am
content: Quote from: alanb on August 16, 2016, 09:02:57 amThat I would agree with, far better to recoup losses from an ongoing customer relationship but ensure that your contracts are fully understood and watertight.Make it very clear that the code is yours and make it clear that there will be no second chance.Ensure you have a way to avoid the situation which occurred before and given they have already demonstrated they're willing to pirate make it simple to identify your code in their product, it could be as simple as an extra punctuation mark on a display, a particular sequence of flashing LED (morse code your initials perhaps) but something that's irrelevant to the normal operation of the device.

author: Galenbo
author_rank: Super Contributor
timestamp: August 16, 2016, 10:48:01 am
content: Quote from: SL4P on August 15, 2016, 10:05:36 pmSo the lesson that is learnt, is that you d better have left a bunch of pics with that several versions of HEX already loaded.Or are it PICs soldered to the pcb?

author: Galenbo
author_rank: Super Contributor
timestamp: August 16, 2016, 11:04:08 am
content: Quote from: CJay on August 16, 2016, 09:07:46 amI wouldn't even mention that. They are either too ignarant to get what it's about, or deliberately frauded the developer because they didn't care.There's no sign why things could end different this time.Just charge them for the work, and lock them into "technical solutions" where the developer himself stays in control.Actively preventing theft is a part of the work the customer will pay for.

author: CJay
author_rank: Super Contributor
timestamp: August 16, 2016, 11:33:42 am
content: Quote from: Galenbo on August 16, 2016, 11:04:08 amit's not just for the customer's benefit, it just makes it easier to win if you have to go to law at a later date if they've signed agreements.

author: Ian.M
author_rank: Super Contributor
timestamp: August 16, 2016, 11:37:18 am
content: When you cant trust your customer with the firmware, the key to protecting something like this that needs to be configured for the specific application is to make the protected firmware load the parameters that control its behaviour from EEPROM (ideally, on-chip).Its quite simple to set up a PICkit 2 with the command line tool PK2CMD to *JUST* load the EEPROM of a protected PIC. It can also be done with IPECMD and any of Microchip's newer programmers (but it tends to be slower and a bit clunky), or you can include a limited bootloader in the firmware so the reseller simply uses a USB <=> logic level serial cable for the task, which, as it means they don't automatically have a programmer handy, removes much of the temptation to fiddle.Then its just a matter of putting together a GUI configuration utility, that can load predefined named configurations, edit the loaded configuration and invokes the command line tool to program the device's EEPROM to configure it. For an added bonus, it could read a serial number from the device, log that and the configuration used to a file and print a label for the device with serial number, config code number etc.Because the only memory that can be loaded without wiping the firmware is the non-executable EEPROM, its reasonably simple to prevent exploits that could disclose the firmware.The whole setup can be passed off as being for your customer's convenience. You can even do stuff like add a countdown event counter (with randomisation) that disables devices with blacklisted serial numbers to make it impractical to use the configuration tool on clones, though distributing the blacklist to the tool may be problematic. If you do decide to add blacklisting, then for %DEITY%'s sake talk to a good lawyer with experience in software and firmware licensing first to be certain you aren't exposing yourself to unexpected liability.If you need more advanced configuration that requires changing the actual code, you can of course set up an individually serialised encrypted bootloader and generate the encrypted firmware for the device remotely on a server under your control, but then you have the hassles of maintaining said server, dealing with end users needing updates, keeping your encryption keys secure, and your bootloader patched against any new exploits + it is absolutely blindingly obvious that you don't trust your customer further than you can spit upwind in a Category 5 Hurricane, which is likely to sour your business relationship unless you are the major player and clear market leader in the field.As to what the O.P. should do, well I think the aphorism 'Fool me once, shame on you; fool me twice, shame on me' applies. You need a bullet-proof contract and recognition that ripping off your firmware was illegal, which means you need those back-royalties. If there is a cash-flow problem, then you may have to accept payment in installments. Doing anything else validates their previous behaviour, and at that point you are better off sacking them as a customer. If you do have to sack them as a customer and you subsequently have an opportunity to 'piss in their Cherios' legally, without undue expense and without damaging your reputation, e.g. by tipping off the AFSA about the concealment of assets from the bankruptcy, go for it!

author: nctnico
author_rank: Super Contributor
timestamp: August 16, 2016, 08:13:30 pm
content: Quote from: IanB on August 16, 2016, 12:06:53 amI agree but you have to be clear about it before you get a contract awarded. Actually my terms&conditions (amongst several other copyright related paragraphs) specifically say the copyright of code I wrote specifically for the customer belongs to the customer AFTER they paid the bill. But by default the copyright belongs to the creator and this is unknown to many people who pay someone to write software for them.As a side note: When I drafted my terms & conditions I came across a terms & conditions model/example which gave the customer zero warranties and no say over what they paid for. It basically locks the client firmly into the vendor. I didn't liked it at all.

author: Rick Law
author_rank: Super Contributor
timestamp: August 17, 2016, 04:52:45 pm
content: Escrowhas not been discussed and I think it is pertinent to mutual protection and worthy of some "ink" here.Software Escrow is a good method of retaining source code control and give the customer an assurance. Merely proposing software escrow to the customer signals the value of the software and opens that negotiation. It however does nothing for hardware. Perhaps design schematic and electronic documents pertinent to the design can be escrowed as well.Just bringing it up tells the customer the value of the software and the design since you are telling him it is worth paying to get some assurance for himself.Google/search "software escrow service" for the USA will find plenty. I don't know about down-under however.

author: batteksystem
author_rank: Regular Contributor
timestamp: October 11, 2016, 10:04:04 am
content: I wonder if there is any update to this?