March/April 2020

Legal Beat
Unlicensed Practice, Copyright, Technical Advice

BY ARTHUR SCHWARTZ, DEPUTY CHIEF EXECUTIVE OFFICER AND GENERAL COUNSEL

Question: Laws, regulations, and codes of ethics are directed toward licensed professionals, but what are the legal and ethical obligations of an unlicensed engineer who’s practicing engineering? Also, how do the legal areas of negligence, professional negligence, and strict liability for engineered products apply to unlicensed engineers? (Illinois)

Answer: Both licensed and unlicensed engineers have legal and ethical obligations. In addition to the regulatory requirements for professional engineers under state engineering licensure laws and regulations, unlicensed engineers can be and are subject to disciplinary action through their technical societies for unethical conduct. In addition, the fact that an individual is unlicensed does not in any way eliminate or mitigate civil liability exposure (e.g., professional liability, torts, contracts). The fact that many unlicensed individuals may be employees of companies that may provide some legal defense when they are acting within the scope of their employment does not prevent such individuals from being sued in their individual capacity.

Since many of these unlicensed engineers work for companies that are involved in the design and manufacturing of products or processes, the manufacturing company (i.e., their employer) will generally be sued. Many of the larger manufacturing companies either self-insure with company assets or obtain appropriate insurance, such as product liability or professional liability insurance. However, as state earlier, this does not prevent the individual unlicensed engineer from being sued in their individual capacity.

Question: As an owner of a medium-sized engineering firm, I have recently noticed reports of huge damage awards against some engineering firms for copyright violations resulting from misuse of software by employees within my firm. What are some of the ways a firm can be exposed to liability for software copyright violations? (Florida)

Answer: As you note, in recent years, there have been several instances where engineering firms have settled with software companies over allegations of software licensing violations. It was reported that two engineering firms agreed to pay fines totaling well into six figures for infringing on a software developer’s copyrights.

Clearly, software piracy is illegal and can have very costly consequences. Piracy can be as simple as two employees installing the same program on their computers when the license agreement permits only one. It can be as widespread as the deliberate, systematic copying of programs throughout an engineering firm, or the purchase of computers with “preloaded” software that was never authorized by the software’s creators. If your engineering firm has obtained software from these sources, or has purchased software that did not come with a license for its use, proper documentation, or other obvious signs that it is genuine, you may be running the risk of using pirated software. If an employee installs unauthorized copies of software on company computers or illegally downloads software from the internet, the firm be held liable—even if the firm’s management was not aware of the employee’s actions.

Question: I am professional engineer in private practice. My engineering firm provides design and construction-phase services for public and private owner-clients. Sometimes during the construction phase, my firm is called on by the construction contractor or subcontractors to provide advice on their construction practices and procedures. Recently, my firm was asked by a subcontractor to provide protection advice related to the installation of certain specified materials. I am aware that the standard contract documents discourage such actions by my firm, and I have been reluctant to provide this advice in the past, but the requests continue to come to me. Is my firm’s involvement appropriate? (Alabama)

Answer: You may be heading down a slippery slope. In recent years, the courts have affirmed the view long advocated by the design and construction community in the standard contract documents that the engineer’s role is not to supervise, direct, or have control over the contractor’s work. Additionally, the engineer’s role does not include authority over or responsibility for the means, methods, techniques, sequences, or procedures of construction selected or used by contractor, for security or safety at the site, for safety precautions and programs incident to the contractor’s work in progress, nor for any failure of the contractor to comply with laws and regulations applicable to the contractor’s furnishing and performing the work. This language is based on the view that the contractor and its subcontractor have control and authority over the construction site, possess a practical understanding of construction techniques and are therefore in the best position to assume responsibility for these activities. If a contractor or subcontractor does not possess the necessary construction expertise to perform their clearly identified contractual obligations, they are obligated to contract for the necessary technical expertise to fulfill those obligations. That is part of what the contractor is being paid to do.

By providing the requested advice, your firm may be engaging in conduct that could undermine the application of the standard contract document language to your firm. In the event of a failure that results in injury or death to a construction worker, a court may conclude that your firm, by its actions, waived the contract provisions and breached a duty to warn the construction worker, and therefore has legal responsibility for the resulting harm.