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Customer using my app on webserver and charging for service

I think a customer is using my app on their webserver and charging customers a service fee. My app generates a report based on user data. They are probably getting the customer's data and then either providing the report or an extract or modification of it. The website requires payment and a login so I cannot verify. They charge several hundred dollars for 3 months. It is a bank industry data processing service.

I would ask them about it but am not really sure if they are violating my EULA.    Maybe this is perfectly OK and I shouldn't care.

My customer has purchased one single user license for my app.
My EULA does not address this directly. It prohibits selling, renting or leasing my software. It seems to me this is a form of leasing my app.

Does your EULA prohibit this?
Bill Anonomist Send private email
Sunday, November 17, 2013
 
 
Email them from a different email address and pose as a customer, and ask for a demo, or at least some screenshots, so you can then verify it.
IdeaSkeer Send private email
Sunday, November 17, 2013
 
 
Kinda hard to pose as a bank. But like I said,  I don't know that what I suspect they are doing is a viation of my EULA.
Bill Anonomist Send private email
Sunday, November 17, 2013
 
 
IANAL but if they're leasing it, and your EULA prohibits that, then they're probably violating it.
IdeaSkeer Send private email
Sunday, November 17, 2013
 
 
Can you embed something in the output of your application that would watermark for your software ? - In order to prove that they are using your application.

Start a competing service ? - Is it possible that you can scoop up the customers using the service.

What if you have an informal chat with the bank and they admit to it; are you prepared to offer them a deal ?

If you think they are breaking your EULA but you're not sure because of the wording of the EULA then you probably need to talk to a lawyer. You should be asking is it enforceable, does it cover this scenario well, how to tighten it up for the future, what type of proof would you need if you decide to take this further, etc.
koan Send private email
Monday, November 18, 2013
 
 
@koan

I think what I should do is create a webserver license and have the installer and executable block if running on a webserver without the webserver license. I will have to decide how to charge for such license.

For customers using the current version on a webserver, I have to treat that as water over the dam.
Bill Anonomist Send private email
Monday, November 18, 2013
 
 
It sounds reasonable.

By the way, my EULA forbids creating derivative works and renting/leasing. Both these terms would hopefully be enough to prevent someone creating a web service as you described.
koan Send private email
Monday, November 18, 2013
 
 
Don't you have anything like this in your EULA?

"You may not distribute the Product to any third parties or permit other individuals or entities to use the Product."

"You may not rent, lease, or otherwise transfer rights to the Product."

Pretty standard wording, as far as I can tell.

Perhaps you can turn this into an opportunity. OEM license, whitelabel, or something like that.
Dmitry Leskov Send private email
Tuesday, November 19, 2013
 
 
If you don't have a clause in the EULA  ..... change it so you do.

Then contact them pointing out the problem and offering a solution ( i.e. they pay you a %age )

A side question : If they need your software to offer an online solution doesn't that mean you could compete with them?
TomTomAgain Send private email
Wednesday, November 20, 2013
 
 
Dmitry Leskov: 'Don't you have anything like this in your EULA?

"You may not distribute the Product to any third parties or permit other individuals or entities to use the Product."'

So if I am looking to hire someone and the person claims expertise in such a software package that my company uses, I would be breaking the licence if I tested him before hiring using the software package.  Not nice.

Part of my interview for one position involved showing that I could use the software package.

Sincerely,

Gene Wirchenko
Gene Wirchenko Send private email
Wednesday, November 20, 2013
 
 
@Gene: "You" in EULAs normally means "person or (single) entity", and the definition of "use" may vary. You can have named users, seats, floating, site, etc.

As far as I can tell, under our EULA your use case would be legal,  though IANAL.
Dmitry Leskov Send private email
Wednesday, November 20, 2013
 
 
Dmitry, someone one has not hired yet is a third party.  That would fall afoul of the clause you posted.

Sincerely,

Gene Wirchenko
Gene Wirchenko Send private email
Thursday, November 21, 2013
 
 
@Gene: Then all companies are breaking their vendors' EULAs all the time when testing job candidates against commercial products prior to hire. But I am yet to see a EULA explicitly permitting (or prohibiting) this use case.
Dmitry Leskov Send private email
Thursday, November 21, 2013
 
 

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