Question #1: The App Developers' Dilemma

Laura is an app developer based in Leysin, Switzerland. She has been working for years on an algorithm for a machine-learning process that will help identify the ideal hair-care product for a given user's hair, based solely on an uploaded picture of the user's hair. Each user will upload a picture of his or her hair, and the app will recommend the best product. Recently, she succeeded in making a breakthrough.

Laura told her friend Melissa, who is a graphic designer, about this algorithm. Melissa became very excited, because she saw the potential for a mobile app that would make Laura's algorithm accessible to any member of the public. Melissa went home that same day and came up with both a name for the app -- HairWare - and a logo. She sent Laura the design brief. Laura loved it!

Together, Laura and Melissa researched the process for bringing their app to market. They estimate that, to bring a minimum viable product to market within one year, they'll need at least 250,000 CHF in investment. This amount includes money to pay each of them a salary, as well as other app-related expenses. With this investment, Laura and Melissa estimate that they can make a total of 1,000,000

CHF over the next five years.

Tomorrow, Laura and Melissa have a meeting to visit Noemie. Noemie is a wealthy businesswoman who owns a chain of hair salons in Vaud. Noemie also sells her own line of budget shampoos and conditioners.

Laura and Melissa have hired you to advise them in advance of this initial meeting. Please write a letter to Laura and Melissa which answers:

1. What intellectual property rights, if any, do Laura and Melissa own? Be sure to specify who owns which intellectual property.
2. What offer should Laura and Melissa make to Noemie? Draft the essential terms of an investment contract that they can propose to Noemie during their meeting.
3. Assume that Noemie signs this contract, but that Laura and Melissa are unable to succeed in creating the app. What risks do they run if they cannot perform the contract? Explain their potential liability in this case. (using the Swiss Civil Code)