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At university hackathons I have been to there's usually a short waiver covering liability and sometimes ownership. Nothing very extensive compared to many legal contracts these days, but I would say that given the rather litigious culture in the US these sorts of papers are justified. The one mentioned in this article definitely sounds more troubling, however.

Typically a release form is about it. This is someone trying to take advantage of innovators.

This sort of legalese and fear of any potential liability for anything is normal for everything in the US.

It's crazy.