App Store app Ownership

Question

Lets say hypothetically 5 years ago someone (Person A) created a company with someone else (Person B) and they split the company 80 (Person B) / 20 (Person A) and then used that company information to create an apple developer account to create an application. The application never got released but the apple developer account still remained. The company was not dissolved but no real work was really done to further the company's interests after this point.

Now 5 years later the developer (Person A) logs into the account again and uses his own money to reinstate the account to release an independently developed game. But all the developer account information is under the previous entity. The developer releases the game and it grows in popularity and makes money. The developer collects the money for a while.

Then Person B discovers the game and that it has the old entity name under the game. Person B sues Person A and demands back payment of 60% of the profits.

Does Person B have a case that could likely win? At what point does an Application or Website become the possession of an Entity or Company? Does this have to be spelled out by a contract or is it all "implied"?

This is hypothetically in New Jersey in the United States

Answer 1

What you call "the developer account" is a legal contract between the "defunct" company and Apple. The subject of this contract is the distribution of software.

When Person A asked Apple to distribute software, via this developer account, i.e. under the terms of the contract between their company and Apple, the reasonable interpretation is that their company was involved in the at least the distribution of the software.

The chief problem here is that the application being distributed has a copyright, and that copyright is likely owned exclusively by Person A. There is no documented transfer of ownership, and the company was effectively in hibernation so this is not a work for hire.

The situation where two or more companies (besides the creator) are involved in software distribution is not unusual, so there is legal precedent enough for saying that Apple and the "defunct" company are both distributors.

So, the reasonable distribution is that Person A receives the lion's share of revenues as the developer, Apple receives most of the rest as the primary distributor, and the defunct company gets a tiny share - just enough to refund the AppStore costs that Person A fronted.