So I was enjoying the Daft Punk soundtrack for TRON today, and there’s one niggling thing that’s been bothering me ever since I saw the movie last Christmas. I’m about to reveal myself as a super-nerd, but seriously, what will happen if people rely on movies for legal advice?
In the opening scene, Young Flynn infiltrates his own company and releases the software as open-source. He gets chased down by an unexpectedly intrepid security guard who goes beyond the call of duty and follows Flynn out to the end of a construction crane. (That’s your first hint that we are far from reality.)
Teetering on the crane, Young Flynn explains, “Don’t worry, your boss approves of what I just did.” He explains that the guard’s boss is ultimately the CEO, and the CEO’s boss is the shareholders, and Flynn is the biggest shareholder.
Therefore, Flynn can give the software away for free?
WRONG! SO SO SO WRONG!!! All the Daft Punk in the world won’t make this right!
Flynn may be a genius hacker, but he fails Corporate Law 101. If the first principle of geometry is that the shortest distance between two points is a straight line, and the first principle of physics is that energy can’t be created or destroyed, the first principle of corporate law is that companies belong to shareholders. All of the shareholders, not just the majority shareholder.
Here’s a thought experiment: Suppose I give my niece and nephew a car. I give it 95% to the older one and 5% to the younger one. Can the older one donate the engine to the kidney foundation?
No way, Flynn. It doesn’t matter if you own 51% or 99.99%. If there’s one minority shareholder out there, you’re getting sued.
I like the garage doors in your bachelor pad, though.
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