Our Team Won Startup Weekend and All We Got Was a Shitty New Boss
I think his response to someone suddenly "owning" the company is odd.  Here's what my response would have been:----
Hi, Billy.  Thanks for telling us about your other company with your friend.  I'm a little disappointed that you weren't open that you're already in this space.  And that your existing company is in direct competition with the one we all agreed to start that weekend.However, I'm flexible.  I'm willing to license my code to your other company for a flat fee of $10,000.  This includes all intellectual property rights to my software.That fee is reasonable given my time and experience.  I think that the others on the team will have similar opinions about their contributions.If you choose to not take me up on my offer, I wish you luck finding programmers to re-implement the software from scratch.Sincerely,
Programmer.
---... does anyone not understand the legal rights behind IP?  Billy has zero rights to use the software in his existing company.  He knows that, which is why he's trying to bamboozle everyone.Instead of arguing about an "existing" company, they need to talk about their code.  They own it.  They control it.  No one else has the legal right to use it.What's the problem?  They don't give Billy the right to use their code, and he goes away.... or gets sued.