Open source company - how to protect myself from being sued?

Question

In 2 and a bit weeks I'll be participating in a hackathon, where I'll create the prototype of an application that I want to base a company off of in the maybe-near future.

Both the prototype and the real version (made under the company) will be entirely open source.

I'm not concerned about people copying me or starting a similar company as me or what not. I just want to work on my product in peace.

What I am scared of, however, is a case where a mean party first copies it from me and later tries to sue me as breaching their rights/copying them, because they got legal documents X, Y and Z prepared but I didn't.

I don't really know anything about law, but basically I want to know how I can protect my company, not my code.

Also, is there any special preparation I need to do before the hackathon, considering that the company that I want to run the real version of this product in the maybe-near future doesn't exist yet? (i.e. what if after the hackathon but before I start my company, some other party starts a company with the same idea - how can I also be protected in that case?)

In probably-idiotic-non-legal-terms, how can I set myself up such that, legally speaking, it's obvious that "I came first" (unless somebody did actually precede me) and that I can use that fact to defend myself if under lawsuit from a copy-cat?

PS: The company will be based in Australia, but its services are all online (international).

Answer 1

You can't do anything that makes it impossible to sue you. I can sue you right now because I don't like your post. I'll probably not get anywhere with it, but nothing can stop me from suing you. So forget about that part.

Now about suing you successfully. Let's say I copy your code, do all kinds of paperwork, and then sue you for copying my code. This goes to a civil court. And then there comes discovery. Claiming that I have the copyright, I'd have to show that I wrote the code, or I hired someone who wrote the code for me, or I got a copyright transfer from a previous copyright holder. Whatever I come up with, it involves lying in a civil court. And lying in court is criminal.

Let's say I convince Joe to go to court with me and say "he paid me $10,000 to write the code for him, and that's what I did". You would then ask Joe whether he can show the cheque for $10,000 or something in his bank accounts, and his tax returns where he told the IRS about the $10,000. Obviously Joe has none of these. So he has a bit of a problem. You will then ask Joe if this is really what happened or if he just made the whole story up, and make it clear to him that lying in court is a crime. Most likely Joe will give up at that point.

All in all, suing you is a rather stupid thing to do. You can't prevent it, but its unlikely to be successful, there's no real upside to it, and that's why people don't do it.

Just as an example, I have quite a bit of code at home that I have written myself and that I own completely. I don't only have the code. I have several months worth of backups that prove the whole history how the code was created and modified, starting with nothing and building up from there. Anyone copying the code wouldn't have that. They would have the final code, they wouldn't have anything that proves any of the steps of creating the code.