Consumer Law, Warranties Walking away from a business idea gone cold

[Programmer]

I have a business idea that required a partnership with someone who was knowledgeable in the field. I had him sign a non-disclosure agreement which he altered to expire in 1 year. After hearing the idea he wished to be a partner and an oral agreement was formed. I would own 67% of the company and he would own 33%. He was content with this for a while until about a month has gone by and I have developed a demo to better illustrate the idea. He was very impressed with it and wanted 50% of the company now. I didn't give in and later on he said that he would he would really like me to reconsider. I asked him several times to draft up a contract and get everything registered with the appropriate shares he said that he would get on top of that and also supply me the written information I need to develop the actual program.

My questions is can I be sued for breaching an oral agreement and do I have to compensate him for his time and input? He shared some ideas with me when he singed the non-disclosure agreement. However, I never singed an NDA while he disclosed his ideas... and he's stated in the past that if I were to walk away or do anything with the idea without him he would like compensation. However, I've read that you cannot copyright an idea only the end result or the product resulting from that idea.

Anyways I just want to walk away from this without lightening my pocket to someone who doesn't want to contribute. I believe he is deliberately postponing working on this project with me until the NDA expires. At which time he can bully me into more shares.

Any help would be appreciated.

 

[Michael Wechsler]

I think it might be difficult for the other person to sue you but your case is very fact intensive and we don't have all of them here. Was there a true agreement and meeting of the minds? Perhaps there was but I'm not sure. Without formalized papers it would seem that this would be a tough case for the other person to make and paying for time and materials might be an appropriate resolution.

The bottom line really is how integral is this person to your business? You have a choice whether to sign them on now or and not worry about the NDA expiring or worry about him competing when that happens. It's your call but I probably wouldn't even worry about suit unless there was serious money made, not potential. By that time a court might just say that if he didn't sue it's a case of sour grapes. Not having a written agreement makes a breach case very, very tough to prove IMHO.

Originally posted by Programmer
I have a business idea that required a partnership with someone who was knowledgeable in the field. I had him sign a non-disclosure agreement which he altered to expire in 1 year. After hearing the idea he wished to be a partner and an oral agreement was formed. I would own 67% of the company and he would own 33%. He was content with this for a while until about a month has gone by and I have developed a demo to better illustrate the idea. He was very impressed with it and wanted 50% of the company now. I didn't give in and later on he said that he would he would really like me to reconsider. I asked him several times to draft up a contract and get everything registered with the appropriate shares he said that he would get on top of that and also supply me the written information I need to develop the actual program.

My questions is can I be sued for breaching an oral agreement and do I have to compensate him for his time and input? He shared some ideas with me when he singed the non-disclosure agreement. However, I never singed an NDA while he disclosed his ideas... and he's stated in the past that if I were to walk away or do anything with the idea without him he would like compensation. However, I've read that you cannot copyright an idea only the end result or the product resulting from that idea.

Anyways I just want to walk away from this without lightening my pocket to someone who doesn't want to contribute. I believe he is deliberately postponing working on this project with me until the NDA expires. At which time he can bully me into more shares.

Any help would be appreciated.