Even Non-Profits Are About the Money (Lit Review)

March 2, 2015


Software Freedom Law Center


A Legal Issues Primer for Open Source and Free Software Projects (Ch. 3)


PDF Document



The Gist

Any project which begins to involve more than a few people must choose ways to organize its leadership and structure
Chapter 3 of the text explains how organizations can be structured legally, and gives advice on which might be right for certain situations
There is a complex legal web surrounding organizations and their income, especially 501(c)(3) non-profits

The Good

  • The chapter covers a variety of ways to legally incorporate and instructions for doing so
  • The Software Freedom Conservancy and other umbrella organizations are mentioned, which are relatively unknown outside of the FOSS community
  • Clarifies that recording meeting minutes is legally required for incorporated organizations

The Bad

  • Extremely local perspective (extreme detail about New York specifically)
  • Mentions “509(a)(1)” without ever defining what that is
  • Never really addresses if or when it’s “okay” to not incorporate a large project

The Questions

  • Are there states with potential incorporation incentives for non-profits other than Delaware?
  • How could an individual developer ever be liable for “implied warranties” on software they give away?
  • The chapter makes no mention of paid services which assist in incorporation, for example LegalZoom. Is there any reason a FOSS non-profit shouldn’t use a service such as LegalZoom?

Rating: 4/5

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