Patent Liability Insurance

Bruce Alspaugh compulinkltd at
Wed May 16 17:13:28 UTC 2007

I see my original posting has generated quite a bit of interesting 

 From our perspective, we have to look at the big picture and find an 
acceptable balance between the potential risks and rewards of running an 
open-source project.  The risk of finding ourselves on the receiving end 
of a patent infringement lawsuit is one risk we have to consider in the 
overall picture.  We have to weigh the likelihood of finding ourselves 
in that situation and the costs involved if we ever do.

Pretty much everything in our project can be shown to build upon 
well-known prior art that can be readily found in computer science 
textbooks.  So to the best of our knowledge, we think the chances we may 
have inadvertently infringed a valid software patent are low, even 
though we have not undertaken the cost of a patent search or attempted 
to do it ourselves.  Also, since there is not much money that could be 
recovered by successfully suing us, we don't think we are a particularly 
attractive target for a such a lawsuit.[1]  Through separate 
incorporation and/or using a software conservancy, we should at least be 
able to shield ourselves from personal liability.  The conservancy has 
the added bonus of giving us access to well-respected attorneys who 
might come to our rescue should we ever need them. 

I don't know that it is ever possible to eliminate all risk in life -- 
we all die of something eventually.  There is risk involved in simply 
getting out of bed, but if you never get out of bed it would be 
difficult or impossible to experience the rewards of living.  So it all 
has to be taken in perspective.  Most of us drive automobiles because we 
need the mobility, but we still wear seat belts, try to drive prudently, 
and purchase insurance as needed or legally required.  We hope that the 
potential rewards of involvement in open-source still outweigh the risks 
in today's competitive and legal environment.

It should be possible to identify prudent best practices for 
organizations that run open-source projects which is my main reason for 
posting questions to this list.  We have already found at least one:  
Contributor License Agreements.  I'm sure there are others.


Bruce Alspaugh, CTO
CompuLink, Ltd
409 Vandiver Drive #4-200
Columbia, MO 65202-1565

[1] I'm reminded of the advice that if you live in a ghetto it's a good 
idea to drive an old rusted-out car with no hubcaps if you don't want it 
to be stolen.  I think it could be argued that today's software patent 
environment amounts to a "legal ghetto."

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