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Inc. had no rights to the technology for which they had provided
funding. Essentially, the syndicates, through their
representative, informed CPSG, Inc. that the management agreement
by and between CPG and CPSG, Inc. to market the software
technology conferred no rights on CPSG, Inc. as the syndicates
had not approved the agreement.
Petitioner decided to continue the development without
funding from the syndicates. Petitioner believed he would have
more negotiating leverage with respect to the developed software
if he finished development in his own name, instead of in the
name of CPSG, Inc. Petitioner’s reasons supporting this decision
were: (1) CPSG, Inc., as a marketing entity, had no development
capability; petitioner was the only person who had the skill set
to do the development; (2) it was prudent to create intellectual
rights outside of CPSG, Inc. because (i) CPG could cancel the
submarketer agreement in 1997 for no reason and, at other times
as stated in the agreement; (ii) the syndicates took the position
that they could modify or terminate CPSG, Inc.’s rights to the
newly developed software technology because the grant from CPG
was in conflict with the rights of the syndicates; and (iii) CPG
controlled the syndicates and could cause the syndicates to
6(...continued)
terms governing the syndicates. The terms of the syndicates
forbade the grant of exclusive rights to the improved technology
without explicit permission of the syndicates.
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