WebSaver

By Constance Bagley, Rakesh Khanna
1997 | Case No. E239
Examines several legal issues faced by Samantha Fine, the CEO of Next Step, a software concern that is focused on the World Wide Web and planning an initial public offering. Describes Fine’s computer-related experience prior to founding Next Step and discusses the actions associated with transforming WebSaver from an unproven idea for a software product to one of the most successful Web-based software products. Provides a brief description of the origins of the Internet and the Web, the Web search engine market, and advertising on the Web. Although the subject of this case is a company whose primary product is an innovative program in a relatively new and rapidly changing medium, the legal lessons that can be learned from this case are applicable to a wide variety of entrepreneurial ventures. Legal issues include domestic and international protection of intellectual property, effect of assignments of intervention, non-compete clauses and non-disclosure agreements, equity rights of a founder who leaves, and tax and accounting consequences of a last-minute issuance of cheap stock.
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