A long time friend and I started a business selling a web-based application. We never incorporated, and don't have a full fledged business. I built the application and hold all of the code and passwords for all but one of our four customer websites.
He took a spin-off idea that we came up with, found another programmer and started a company (incorporated and all) to sell this spin-off. He has offered to buy-out my part of our application based on projected sales of this product through his new company.
My questions are many.
1. Do I have any recourse for the stolen idea?
2. Do I have any recourse for the verbal contract that he and I shared that WE would build this new application and sell it?
3. I have countered his offer with a one time buyout at 10% of his offer, He can't afford it and says his offer is non-negotiable.
Can I legally hold on to what I have (source code, domain name, hosting) and tell him to jump off a cliff?
4. Do I need to be worried about him sueing me for what I have?
We hav no written contracts binding either of us. Only a product he sold an I built, and the verbal agreement that we were in business together and would sell any products that were a spinoff of the original together?