The Sex Tape Litmus Test

http://laverick.org/blog/2012/12/23/the-sex-tape-litmus-test/

by dustin • 14 years ago

183 135 14 years ago

I think that any funny clauses in the contracts should be abolished and the worker/employer relations should only be regulated by law.

This makes me pro-regulation and anti-market, but unfortunately I see exactly zero ways in which market can make contracts better. What are you expected to do in this situation - quit?

wyuenho• 14 years ago

Collective bargaining rights was developed to counter exactly this power imbalance with minimum government involvement. Unfortunately I'm not aware of any programmer unions.

mistercow2• 14 years ago

What's odd to me is that in many cases people who purport to be "pro free market" are also anti-union. As far as I can see, unions are the free market.

cracell• 14 years ago

Negotiate for the removal of these clauses from your contract and don't sign it if they won't remove them. Sometimes this may mean passing on a job but if everyone did this then employers wouldn't try to get away with it.

pretoriusB6• 14 years ago

>Negotiate for the removal of these clauses from your contract and don't sign it if they won't remove them. Sometimes this may mean passing on a job but if everyone did this then employers wouldn't try to get away with it.

The problem is that the effectiveness of this relies on the bargaining power of the employees, which, in a "buyer's market" is not that much.

Better to get the law to change to forbid such abuses for everyone.

ChuckMcM• 14 years ago

In this case Sony is trying to change the agreement post employment. I wish the OP had said what HR said about ownwership of the sex tape, I really would have liked to use that example with the Google lawyers to see where they came down on it.

I don't doubt that future contracts will say "We reserve the right to update this in the future as conditions change in order to remain compliant with applicable regulations and laws and in order to protect the interests of the company."

Once you sign that, even with a permissive clause, they come back later than blam! Change it and you've pre-agreed to their changes which can now be much more restrictive.

benwerd• 14 years ago

In smaller companies you can sometimes rewrite the contract. I've done this, specifically to remove this clause.

sskates• 14 years ago

Yes, you can quit and work somewhere else. Also you can read about what Sony does on Hacker News and decide not to apply there for a job in the first place.

I really hope you are not actually against customized employment contracts- there are a lot of cases where they can be useful. What might be better is prohibiting instances of terms you find offensive. For example, California's moonlighting law, which effectively voids such clauses in employment contracts: http://www.quora.com/Legal-Issues/Which-California-laws-prot...

pretoriusB6• 14 years ago

>Yes, you can quit and work somewhere else.

As if people always have that luxury. What if most companies in your field (e.g computer games) follow similar practices? "Go work at another field"? Why fell prey and bow down, looking for work elsewhere, and not try to change the system instead?

If a company didn't allow black or gay employees would that be acceptable, and people be told to just "work somewhere else"? I think not, people would revolt and try to change the laws so that the company cannot do that. Why should BS NDAs be any different?

People forget that:

a) we're not necessarily talking about the top 1% of employees companies fight over, but also for the rest 99% of the people, that don't have an upper hand in negotiations and don't always have the luxury of moving around, staying out of a job long enough to find a better one, etc.

b) we're not necessarily talking about a "seller's market" such as programming

c) even if we did (b), we're not necessarily talking about now and the Valley, but also about times and places where unemployment is rampant.

pi18n2• 14 years ago

I think for many people it's going to be hard to fulfill the following:

> ... except for those inventions that either: (1) relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer ...

As a programmer, there's not a lot I can do that is going to be considered wholly unrelated to what I'm employed for... at least it would be murky enough that the employer would have a good court case. This is infinitely more so for anyone working with Google, Apple, or any other company that has got their fingers in everything.

guard-of-terra2• 14 years ago

"Yes, you can quit and work somewhere else"

How exactly will it help when all employers adopt stupid and evil clauses in their contracts? Because that's what they do. Legal documents ("best practices") seem to circulate between companies, growing more bulk with each round. There's no place in this process for the consideration of employees' wishes. There can't be because legal department is famously isolated from the rest of the company and only cares about covering their own ass. They don't care about productivity. They don't care about happiness. They only care about having all bases covered. So I don't see why they won't grab every right from you that they can without violating the law.

If the law is where they stop, then there should be the law and nothing else. There's no reason for all those contracts-writing people to be employed.

jiggy20118• 14 years ago

I'm not sure a one-size-fits all regulated solution is the answer.

For example , what about a startup that wants to make signing of an NDA a requirement for employment? Would they be expected to just take it on trust that a new employee isn't leaking stuff to their competitors for cash?

What about employments that might deal with highly sensitive/classified information and thus require certain background checks to be performed before & during employment?

pretoriusB6• 14 years ago

>Would they be expected to just take it on trust that a new employee isn't leaking stuff to their competitors for cash?

Well, make that punishable by law, and no need for an NDA.

andrewflnr2• 14 years ago

If we're going to have regulation, I think it would be more productive for it to make it easier to quit your job. That should actually improve the free-market dynamics.

HeyLaughingBoy• 14 years ago

How could it possibly be easier to quit your job?

If I want to quit my job all I have to is not show up to work and eventually, after a few attempts at communication, they will send me a form letter and my final paycheck and remove me from the list of active employees.

Of course, being a more polite sort, I'd probably at least email my manager that I wouldn't be coming back.

But seriously, how could it be easier?

rayiner2• 14 years ago

It's only "anti-market" if you fall into the common fallacy of conflating ideas of individual and economic freedom with the functioning of the markets. It's not at all the case that increasing say contractual freedom is always coincident with the improved functioning of the markets. The classic example is anti-trust law. Laws banning producers from forming cartels to fix prices is a restriction on contractual freedom, but they're a restriction that produces better, more competitive markets.

There are a lot of considerations on the elasticity of demand for labor, information asymmetries between employer and employee, relative bargaining leverage, etc, that weigh in favor of laws to regulate the labor market. I think a great example is bans on NDA's or non-competes. They help make the labor market more liquid and prevent anti-competitive labor practices, even though they are a restriction on contractual freedom.

cbsmith2• 14 years ago

> I think that any funny clauses in the contracts should be abolished and the worker/employer relations should only be regulated by law.

That tends to work well in a one-size-fits-all well established world, but tends to work particularly poorly in new and emerging industries.

dsr_• 14 years ago

The primary function of a legal department is to provide advice that prevents legally actionable mistakes.

This advice does not have to be sane, or efficient, or indeed have any consideration towards the interests of the company other than "prevents legally actionable mistakes". A few days ago HN saw an article about setting goals and perverse incentives. This is a simple example.

Hypothetically, someone was reviewing the Sony USA employment contract and saw that there were, perhaps, non-video-game related developments which might be valuable. Then they asked the legal department "Please supply contract terms that give us as much as possible." And after an hour or two of research, they did.

The surprising thing to me is that they tried to change language for existing employees out of cycle. If they did it during a regular review cycle, even fewer people would have noticed.

endianswap• 14 years ago

Do typical BigCorps require re-signing your contract during the review process? Neither of the ~300 person tech companies I've worked for have had me sign anything past the first day.

unreal37• 14 years ago

Once a year there is an email that goes out saying "the law for X has changed, and so we require you to acknowledge you know this and sign Y". Basically updates to the employee handbook.

dexen• 14 years ago

> The primary function of a legal department is to provide advice that prevents legally actionable mistakes. This advice does not have to be sane, or efficient, (...)

Strong disagreement. As a counterport, would you agree to the following: ``the primary function of a programming department is to crank out code. the code doesn't have to run predictably, nor be maintainable nor indeed have any business requirements. KLOC is the king.''?

When I'm programming privately in my spare time, my code doesn't need to run, be maintainable or useful or anything. But as long as I'm clocked in during office hours, my work should further company's goals, in harmony with other teams and projects. And just as much with legal departments: those should consider the overall effects of advice they give out. If not them, who else is to do such analysis -- some meta-legal department?

Been there just recently; an employment contract template prepared for my company by a lawyer was so one-sided and full of risks for potential employees, I stood up to the CEO and voiced against its proposed form. I've warned the CEO a lot of self-respecting hackers would rather give up offer than work on such conditions. The contract, while legally covering the company, would have detrimental effect on our ability to hire good hackers in the first place.

jamesaguilar2• 14 years ago

It seems like a lot of engineers, both here and elsewhere, have a very simplistic view of what other departments do. I've seen similar simplistic statements about design and management. I guess that's just part of human nature, to develop the view that only your work is complex or nuanced.

zaidf• 14 years ago

the primary function of a programming department is to crank out code

OP didn't say the primary function of the legal department was to crank out legal language. He does say their job is to crank out advice that "prevents legally actionable mistakes".

Similarly, I think most developers at core are expected to output code that fulfill some communicated requirement.

lsc• 14 years ago

>> The primary function of a legal department is to provide advice that prevents legally actionable mistakes. This advice does not have to be sane, or efficient, (...)

>Strong disagreement. As a counterport, would you agree to the following: ``the primary function of a programming department is to crank out code. the code doesn't have to run predictably, nor be maintainable nor indeed have any business requirements. KLOC is the king.''?

I don't see where you are getting KLOC; KLOC is rarely a metric that Programmers like. They'd choose readability, or (run-time) efficiency or something.

But yes; That's what you see. In both cases, really; I know last time I went to a lawyer for help with a AUP or privacy policy, I got something ridiculously one-sided that protected me, but would have been an absolute PR disaster to actually hand out as policy.

And yeah, I've seen programmers come up with solutions that were equally good from a purely technical perspective, but equally insane from the perspective of the whole business.

This is why managing a business is so difficult. You can't expect the lawyer to understand PR any more than you can expect your programmer to understand marketing. (I mean, sometimes you get lucky and find someone that is pretty good at both... those people are quite valuable, if you can find them.)

Actually, that's another discussion entirely. When you see the company you are working for (as a narrow specialist) doing something that is bad outside of your specialty, how hard do you try to change that? I mean, certainly, you should say "This isn't my specialty, but I think doing X is wrong, I think you should do Y" - the question then, is how hard do you fight for it. I mean, it is the person managing the company's job to choose specialists who are competent. At what point do you step out and say "Hey, you screwed it up" outside of your specialty?

dustin2• 14 years ago

As with most departments, legal works on a continuum.

Some coders push buggy code and some coders polish their bits endlessly. The good ones write code that meet the requirements in a reasonable amount of time and move on to the next task.

Some lawyers are strict letter-of-the-law types and some will approve anything to make the profit centers happy. The good ones balance the legal risks with the commercial reality.

Under the circumstances I'd be curious to know what the cost-benefit analysis of this change might look like. Given how seldom employment contracts are negotiated and how rarely these IP clauses are enforced, my guess is the biggest cost might be something even more intangible, such as stifled employee creativity.

cbsmith2• 14 years ago

That is an impression of legal departments informed by what tends to be poor staffing of such departments and/or poor management scapegoating the legal department.

I used to have a very poor opinion of legal departments until I had the opportunity to work with legal departments staffed seemingly exclusively with people who were at least as sharp as the folks in engineering. Turns out, good legal departments are as interested in solving problems as good engineering departments.

Ziomislaw• 14 years ago

just like yeti, and nobody has seen any of them

mgkimsal4• 14 years ago

I've brought this up as the "child porn" clause, and had brought it up in an employment contract once many years ago. Basic language was "we own anything you create". I said "I don't really think you want that - if I create some child porn, you're the owners". I seem to remember I had some less restrictive language placed in my contract vs that one, but I don't think it made a change to anyone else's contracts.

Yes, it felt a bit 'nuclear' dropping such a charged statement like that, and even when I bring it up as an example in conversation, some people cringe - a 'sex tape' analogy might be less offensive to some, but the basic premise still stands. Any company that wants to claim ownership of every piece of content or code I 'create' needs to understand what that really entails. It might actually give some people license to work on legally questionable stuff (not child porn so much as, say, banned crypto), knowing that they don't really 'own' it and thinking someone else might be responsible for the consequences.

jiggy20118• 14 years ago

IANAL , but I believe in this case the offence would be in the creation and distribution of this content not necessarily in owning the IP.

Otherwise you could technically make the same argument about instagram for example.

mgkimsal4• 14 years ago

nothing said about distributing it, although I see your point on the creation of it. But I'm not sure I'd be able to make that distinction about anything else valuable - "well, company x, you might 'own' this, but I created it and can do whatever I want with it". They want the benefits without any risks - ain't gonna happen.

Well... I say that, but I think everyone might have their price. I've got mine, and yes, sure, would I sign away all my IP created during employment for $x? yes, but no one has yet come close to that $x in job offers I get.

nakkiel• 14 years ago

IP assignment is the only thing I really negotiate when I take on a new position. I had one company back-pedal as they were trying to change their terms from nothing to we own anything you make, any time. I had the CEO/CTO of another company write in plain English that anything done in my free time and without using company-owned facilities/hardware was my own IP (their legal bla-bla was unclear).

In the first case, the corrected terms got applied to everybody in the company but in the second, I believe I'm the only one who is protected thank to that written note.

I always use the analogy of an English teacher writing a book on his spare time. How he would actually be encouraged to do so, weighting how this would reflect nicely on the school he works at etc..

colanderman• 14 years ago

> I always use the analogy of an English teacher writing a book on his spare time. How he would actually be encouraged to do so, weighting how this would reflect nicely on the school he works at etc..

I think limiting IP ownership to right of first refusal is important for the same reasons. If I'm guaranteed that either the company will use the IP I developed, and I will (presumably) be rewarded for it or at least be able to include it on my resumé, or that I can own the IP myself, it is worthwhile to me to work on projects in my spare time.

However, without that guarantee, it's entirely likely that works I produce which are significant to me but not to my company will end up gathering dust on a shelf. Hence I'm disincentivized to work on such (potentially enriching) spare-time projects.

redcircle2• 14 years ago

California has a nice law that says that the employee owns IP created on his own time, unrelated to work, etc. This is a reason I moved to CA: the state I was in lacked such a law, and all the tech companies had contracts that failed the sex tape test. I suspect that for a place to flourish like Silicon Valley, it needs a law that protects self bootstrapping startups.

ajays• 14 years ago

I keep hearing this, and have taken it as gospel (I am in CA), but can someone point me to some citations? You know, just in case.... ;-)

loteck• 14 years ago

Hi. Here's your link:

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab...

2870 is what you're most interested in. IANAL, this is my lay understanding of the law.

linuxhansl• 14 years ago

Your employer should have supplied you with the necessary paperwork to sign (this part is also stipulated in California, AFAIK, that you be made aware of that right)

Xylakant3• 14 years ago

I guess the "unrelated to work" might be a point of debate once you create IP of high value.

In fact, in Germany we have the "Arbeitnehmererfindungsgesetz (ARBNERFG)" [1] which stipulates that your employer has first right to all patents and inventions related to your work, even if you create them in your spare time. The basic reasoning is that your employer supplies you with all tools and ressources required for the invention in question. It would be way too easy to just clock out, return to your desk and a minute later write down the world formula and sell it for billions. You're entitled to a compensation though.

The law looks a little stupid when applied to computer science but makes much more sense in a research or engineering context.

[1] I just adore german legal terms.

dsplittgerber• 14 years ago

It's also ridiculously outdated. It's from 1957 and based on an outdated, traditional understanding of "big" industrial/engineering companies and their employees ("the little guys"). Also, it protects the companies' interests to the detriment of the employees' interests, which is understandable given that it is based on a war-time law (WWII) which was supposed to support German war engineering.

smsm42• 14 years ago

I love it how German seems to be able to put the whole law in one word :) It doesn't sound that stupid, depending on what "related" means - if it is indeed almost the same as you are being paid for, then it may make some sense (I'm not sure I agree with it, as it's basically means employer owns your thoughts, which seems a weird concept to me, but even if it is wrong it's not completely stupid). If it's just "it's all computer stuff so must be the same" then it's stupid. I'd say it all depends on how the courts will be treating it.

pfedor• 14 years ago

There is such a law but you should not assume it means what you think it means. Talk to a legal professional if it's important to you. One IP lawyer I interacted with maintained that the rulings in actual court practice are very unfavorable to the moonlighting employees. To the point that CA labor code 2870 might as well not exist (although of course he didn't say that in so many words.) "Actual or demonstrably anticipated research or development of the employer" can be made to mean anything. I asked, "Say I worked for a company that makes software for medical devices, and I work on cell phone apps in my spare time, could they still claim that it's related to their research and development?" He said, "Yes."

redcircle2• 14 years ago

I hear you. While living at my prior location, I was always integrating plausible deniability into my business plans and their initial implementations, besides keeping my work super secret. Now I don't worry about the secrecy, and feel more relaxed about deniability. (Not that I've been doing anything seriously since I moved here --- I like my team, and I would like to accomplish big things with them.)

makomk2• 14 years ago

That sucks. "Actual or demonstrably anticipated research" looks like a fairly clear attempt to make sure that companies can't just claim that they might be planning to go into some unrelated field, and it's unfortunate the courts don't see it that way.

DannyBee• 14 years ago

California law only seems different to other states. In practice, it's much the same.

Engineers often misinterpret the provisions of the law.

" (1) Relate at the time of conception or reduction to practice of the invention to the employer's business, or actual or demonstrably anticipated research or development of the employer; or (2) Result from any work performed by the employee for the employer."

#1 is pretty vague, and it has been interpreted broadly by most courts. Almost every engineer i've talked to think it means "unrelated to the work i'm doing for the employer" (which is really part #2 of the law). However, it in fact says that not just "work related to stuff you are doing for your employer", but "work related to stuff your employer does at all or has said they will probably do in the future" can be owned by the employer, even in your spare time.

So if you work for a company that does a lot of things, you should not expect to own anything.

In practice, this is not very different from the laws of most states.

While I am a lawyer, this is not legal advice. Just trying to correct a misconception.

jasonjei• 14 years ago

IANAL, but I have heard of something called the Reasonable Person Standard. Since the US is based on Common Law, I believe this standard could be used if this were really tested in court:

``The reasonable person (historically reasonable man) is one of many tools for explaining the law to a jury.[1] The "reasonable person" is an emergent concept of common law.[2] While there is (loose) consensus in black letter law, there is no universally accepted, technical definition. As a legal fiction,[2] the "reasonable person" is not an average person or a typical person. Instead, the "reasonable person" is a composite of a relevant community's judgment as to how a typical member of said community should behave in situations that might pose a threat of harm (through action or inaction) to the public.[3] The standard also holds that each person owes a duty to behave as a reasonable person would under the same or similar circumstances.[4][5] While the specific circumstances of each case will require varying kinds of conduct and degrees of care, the reasonable person standard undergoes no variation itself.[6][7] The "reasonable person" construct can be found applied in many areas of the law. The standard performs a crucial role in determining negligence in both criminal law—that is, criminal negligence—and tort law. The standard also has a presence in contract law, though its use there is substantially different.[8] It is used to determine contractual intent, or if a breach of the standard of care has occurred, provided a duty of care can be proven. The intent of a party can be determined by examining the understanding of a reasonable person, after consideration is given to all relevant circumstances of the case including the negotiations, any practices the parties have established between themselves, usages and any subsequent conduct of the parties.[9]"

bretthardin• 14 years ago

While I was working at Earthlink in 1999, they had a similar clause and I had a similar thought.

Although not around a sex tape, I though about a computer virus released from my Earthlink corporate email account. If I sent it out the virus technically belonged to Earthlink and not me. However, after talking to a lawyer about it years later, he explained there is ways the corporation could get out of the clause.

matt2000• 14 years ago

In case anyone is in a position to hire programmers and cares about treating creative people fairly, we have an open source Hacker Employment Contract: https://www.docracy.com/hackercontract that tries to fairly handle stuff like IP created after hours.

dustin2• 14 years ago

Thanks for posting this. Standard documents are great. Even if you don't get to use them they provide a point of reference for negotiating terms.

btilly• 14 years ago

Note. The contract, as described , would not hold for California employees.

See http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab... if you don't know what I'm talking about.

(That said, Sony probably does enough different things that the difference does not matter much to most people.)

arkem• 14 years ago

In California the contract is often modified to include something like "except where prohibited by law" which means that the company gets IP assignment any time that 2870 doesn't apply.

gnu8• 14 years ago

This story is missing the best part, which is where the compliance officer bluescreens after being asked about whether the sex tape would be owned by Sony.

josephlord• 14 years ago

I think my Sony (Sony Europe not SCE) contract said "in the course of employment" which I went back to HR for clarification that it meant things related to or done for work. The in/during difference being very key. I seem to recall that I got the necessary clarifications and I've left now so no need to worry.

andrew93101• 14 years ago

(tl;dr: in California, such agreements are unenforceable)

I don't know what state the author was in when he was working for Sony, but California State law prohibits such arrangements in employer agreements (Labor code section 2870):

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab...

2870. (a) Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities, or trade secret information except for those inventions that either: (1) Relate at the time of conception or reduction to practice of the invention to the employer's business, or actual or demonstrably anticipated research or development of the employer; or (2) Result from any work performed by the employee for the employer. (b) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

xsmasher• 14 years ago

Every time I've gotten one of these documents I've amended it to "any IP for aspect foo of business bar." Example: video training software, or freemium mobile games. My employers have not objected, and it's a restriction I cane live with.

Honest employers want to keep you from competing with them while on the payroll, and want to avoid any claims that company IP belongs to you. Amend the document to address that and they may agree.

at-fates-hands• 14 years ago

The interesting thing to me is how is this even enforceable? Most of my friends keep a tight lid on all their freelance work - how would they even know someone had broken this contract?

shadowmint• 14 years ago

I'd love to know of any instances of this (work done in personal time being legally given to the company person worked for at the time) going to court.

Sounds like a non-compete clause to me; ie. basically unenforceable.

kabdib• 14 years ago

My current employment contract says that even IP /related/ to my employer's business, as long as it is done on my own equipment and my own time, is mine.

It's an enlightened place.

I expect to have to prove it, to some extent, if it ever came up. Which is one of the reasons I have a private github account; commit logs on machines not controlled by me might be useful.

The Sex Tape Litmus Test

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