YC and 500 Startups company Curebit caught stealing from 37 Signals

Are you talking about Adobe Edge? http://labs.adobe.com/technologies/edge/

You are confusing everyday English with court pleadings. Here are some illustrative examples to show the difference.

1. You come home from work, and find that while you were gone someone came into your garage and stole your motorcycle.

It would be quite normal to exclaim "I've been robbed!". Yet you in fact have been burgled, not robbed. Nevertheless in common English usage people use "robbed" in a more expansive sense than it is use in law. If writing a police report, or an indictment, one must make the distinction, but not in regular conversation.

2. You are in a bar, in a tuxedo, obviously trying to drink yourself into oblivion. I ask you what is wrong. You tell me "my best friend stole my fiancé...on our wedding day!".

Technically, he did not steal her, as she is not property. He perhaps committed tortious interference with contract, or maybe alienation of affection. However, if you are not writing the pleadings for a lawsuit, it is in fact perfectly acceptable to say the bastard stole your fiancé.

3. You are the quarterback for your high school football team. The big game is coming up with your most hated rival high school. Your sister starts dating the quarterback of their time. While he is at your house visiting your system, he sneaks into your room, where you have your team's confidential playbook. He quickly uses his cell phone camera to take photos of each page.

This would generally be described as him stealing your plays, even though it is not legally stealing (and probably isn't even legally a crime).

The use of terms like stealing, theft, robbery, and so on to describe situations where they do not literally apply in the legal sense goes back a long way. E.g., from Shakespeare: "Who steals my purse, steals trash, but he that filches from me my good name robs me of that which not enriches him and makes me poor indeed." Note that he is using both filching (a synonym for stealing) and robbery to describe damaging a reputation.

Copyright law's mechanism is to create a property interest in the right to make and distribute copies of a given work. Exercising someone else's property interests without there permission is acceptably called "theft" in ordinary English.

It's only vague inasfar as the words themselves are vague.

"COPYING" is abused. RIAA and other organizations have really tried to grossly expand the definition and that has tainted the discussion. For the next paragraph, "COPYING" means literally using the same assets (or a digital replication).

The line is drawn at "literally copying assets". Putting up your own assets that are inspired by another site isn't copying. Putting up another company's assets (or downloading and self-hosting other company assets) crosses the line.

I've tried Adobe Edge and the biggest issue I found was with the amount of HTML output and the human readability/context of elements. There seemed to be a lot of wrapper elements used in succession and named long, generic names with numbers. In my brief trial it looked OK in the browser but due to the excessive HTML, it would be a huge burden to edit in anything other than Adobe Edge if you wanted to go back and change anything. In a text editor, I can create a page using only 20% of the elements Edge did and have the opportunity to name them something relevant (e.g. #author_info rather than #generic-1-3-15).

Let's be rational.

Lets say that it is instantaneous and free to copy 37Signal's design, whereas to recreate it from scratch it costs the labor of a designer X units of dollar-time.

For the sake of simplicity lets say that Curebit and 37Signals are competing for customers in a zero sum game.

True, by copying 37Signals, Curebit has taken away some unknown X dollar-time worth of customers away from 37Signals during that 1 hour.

However, even though the customer space of 37Signal's and Curebit's enterprise may be zero-sum, the dollar-time measure of work is non-negative (and not zero-sum). It would make more sense for the industry as a whole to allow the copying of design, because overall it saves on design work time.

What Curebit did appears to be wrong because it appears as though they are outright cheating. However, if you understand that designers gain their chops by reverse-engineering the productions of others, and that this happens routinely in the real world, perhaps it's time to accept copying as a legitimate part of the equation.

In this case, 37Signals was given free rein to track Curebit's customers. Sounds like a good deal to me.