Investing in Technology and Upstream IP Issues

16 Nov ’06

One of the topics for discussion at last night’s mesh meetup was the recent change in writing staff at Valleywag – Nick Denton is now on the case, and the change is already yielding dividends. I was losing patience with the over-the-top cattiness of the old Valleywag – I like my cattiness a little more subdued – and it always seemed to me that they were missing interesting opportunities to take their readers behind the scenes in the Valley.

But today brings an example of what can be done – Nick writes about developments in a dispute between a Sequoia portfolio company and a former employer of the founders, who is apparently asserting ownership of the portfolio company’s IP.

To be fair, this can in many cases be very difficult to diligence. But when it goes sideways, it can really go sideways, as Nick’s post suggests. I had the misfortune in an earlier life of being brought in to help clean up just such a case, but with a wrinkle – what started as a dispute between a founder and the company over ownership was interrupted when a previous employer of that founder claimed ownership – another reminder that the smart fisherman fishes upstream. Two of the more unpleasant aspects of these cases: you have to fight or settle – there is no third way; and fighting is hideously expensive.

An interesting story, and reason to stay interested in what lies ahead for Valleywag.

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