Law Office of Henry B. LaTorraca Civil Trial Attorney

Smartphone app cofounders respond to business dispute

Big ideas often have small beginnings. Yet thanks to technology, ideas for a new app or technology platform may present the potential for huge profits. In fact, technology may even facilitate exponential business growth -- sometimes faster than the founders or partners can handle. 

That seems to be the case with the cofounders of Snapchat, a social media app for smartphones. Snapchat is different from other social media platforms in that it sends disappearing picture messages. The sender can determine, to an extent, how long the recipient is able to view any sent messages. Typically, that time duration is between one and ten seconds of delivery.

However, the cofounders recently found themselves in a business dispute with a colleague who claimed that he had actually come up with the idea first. The colleague, perhaps not surprisingly, was claiming an ownership interest in Snapchat.

An attorney that focuses on business law and commercial litigation understands the importance of having good written agreements between partners in a startup or new partnership entity. Although partners may be friends, it would be a mistake to rely on oral agreements for the material terms facing businesses. As this post demonstrates, competing ownership claims over intellectual property can lead to partnership disputes. An attorney can help business owners review contracts to make sure that they offer both flexibility and protection. An attorney can also offer advice about what types of corporate records should be kept as a best practice. Such records may provide a safeguard against future liability, or at least provide helpful evidence in a dispute.

Source: ComputerWorld, “Snapchat settles ownership dispute, says app idea came from ousted partner,” John Ribeiro, Sept. 10, 2014

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