Ask HN: Co-founding

I was recently asked by a friend of mine to join him in his startup that he had been developing for some time. In the midst of our increasingly serious conversations a few things have emerged that worry me:

The site scrapes statistical sports data from another site to provide part of the core functionality. The founder assured me that he consulted a lawyer regarding this issue and informed me that it is a gray area, but it should be okay. I am told the fee to get this data directly would be $25,000/yr which is currently unaffordable. He says once he can afford it he will pay -- is this illegal? Unethical?

Given that the startup does not yet have any formal limited liability structure, the aforementioned gray area seems all the more worrying if I could be held personally accountable. I am told that at most the initial risk would be a cease-and-desist.

Lastly, the founder informed me that since he has been working on the site for years he would take the "lion's share" of the equity in the startup, and have the final say on all matters. This did not sit very well with me, and I asked him if he saw me as a consultant/contractor or as a partner/co-founder to which he replied that he saw me as a co-founder and would reasonably consider whatever I had to say and try to come to a compromise in any dispute -- but he would ultimately have final say.

Both he and I would like to start working together ASAP. But I feel that despite the time and effort he has already invested, the terms seem harsh. Should I wait for an officially drafted contract? For a corporation to be setup? Even though this is someone that I know and trust it seems a little bit dubious to get involved without a legally binding (and satisfactory) agreement.