MIT President Offers Support to Students Locked In Legal Dispute

Tidbit logo via Tidbit.co.in

MIT officials are throwing weight behind a group of students that are locked in a legal battle with the New Jersey Attorney General’s office over the code they created for a startup as part of a hackathon competition in 2013.

In a letter addressed to the MIT community, dated February 15, the school’s president, L. Rafael Reif, said the students that invented Tidbit, a proof-of-concept code that would allow users to mine for Bitcoins using advertising space on a website, are facing a “surprising and difficult turn of events” and that the school is standing with them through the ordeal.

“I am writing to address a problem that a group of MIT students currently face but that concerns all of us, because it highlights issues central to sustaining the creative culture of MIT,” Reif wrote, describing the AG’s request for “sweeping” documents about the project, which includes code and users’ IP addresses.  “I want to make it clear that the students who created Tidbit have the full and enthusiastic support of MIT.”

Tidbit founder Jeremy Rubin was handed a subpoena from the New Jersey AG’s office back in December. The request for sensitive documentation about the Tidbit concept and project is part of an investigation led by the AG’s Division of Consumer Affairs and Office of Consumer Protection as to whether or not Rubin and his co-creators have violated the New Jersey Consumer Fraud Act.

Since being issued the subpoena, which can be read here, Tidbit has been working with the Electronic Frontier Foundation, or EFF, a non-profit legal group that handles digital rights issues. EFF has been providing services to Rubin, pro bono, in an effort to quash the case.

In late January, lawyers from the EFF filed a counter complaint in court asking New Jersey officials to do away with the subpoena, arguing Rubin and the others behind Tidbit haven’t even launched the project officially and have never received any Bitcoins as a result of the code they created during the hackathon in 2013.

Lawyers told Boston there was serious doubt that New Jersey officials have the ability to use state law to regulate interstate online commercial activity like Tidbit’s since the founders live in Massachusetts, and have no connection to out-of-state transactions.

“The issue is the state thinks [Tidbit’s] being used for some malicious purpose, and we disagree,” said Hanni Fakhoury, a staff attorney for EFF.

No court date has been set in regards to the complaint to quash the subpoena, but Fakhoury expects it will happen in March. Rubin and his team do not have to appear at the hearing.

In a letter to people that signed up for Tidbit before its launch, Rubin and his team apologized for the ongoing  court problems. “We don’t know why the [New Jersey] Attorney General is targeting Tidbit so aggressively, but it hurts all of us. As always, we’re working hard to make progress. With luck, we’ll clear up the legal situation and get back to coding,” they said.

As a result of Tidbit’s legal battle, Reif told students that the school is now developing a resource for independent legal advice, since so many innovative ideas and concepts are born from MIT, its researchers, and student body. “Beyond this specific case, I believe we should provide our student inventors and entrepreneurs with a resource for independent legal advice, singularly devoted to their interests and rights,” he said.

Reif said he has asked the Provost, Chancellor, and General Counsel to develop a plan aimed at creating that resource to add an “essential new strength to MIT’s innovation ecosystem.”

“When the MIT community works together, we spot problems, analyze them, and solve them. Let’s solve this one together,” said Reif.