Posted on 08/05/2005 5:21:20 AM PDT by ShadowAce
You might not know it from some of the coverage, but The SCO Group now appears to be facing annihilation in its lawsuits against IBM, Novell, Red Hat and Linux users AutoZone and DaimlerChrysler.
That's since last Friday, when Novell finally had to file its response to a lawsuit SCO originally filed waaaay back in January 2004. (Groklaw has copies of both SCO's amended suit against Novell and Novell's countersuit, along with a timeline of what's held things up, for those who want so see the legalese.)
If "annihilation" seems like too strong a word, understand this: If Novell gets the preliminary injunction it's asking for, SCO will no longer have any money. None. SCO would be out of business -- something IBM, Red Hat, AutoZone and DaimlerChrysler could never have made happen.
How could that be? It's because of how SCO ended up with Novell's Unix business. In 1995, Novell sold certain Unix assets to a Unix vendor called The Santa Cruz Operation. Santa Cruz Operation wanted to buy everything Unix-related that Novell had, but didn't have the cash. So under the deal the two companies cut, Santa Cruz would collect royalties from Unix licensees and forward them to Novell, which would send back a 5% of the money to Santa Cruz as an administration fee.
In 2000, Santa Cruz Operation sold its Unix business to the company that would become known as SCO Group. That didn't change the deal with Novell: 95% of Unix royalties still had to end up in Novell's hands.
In fiscal 2003, SCO Group reported $25.8 million in new Unix license fees from Sun and Microsoft, according to its financial statements. Novell says 95% of that should be paid to Novell. That would come to $24.5 million that SCO owes Novell.
But SCO currently has only about $11 million. So Novell is asking for SCO's assets to be attached and its cash put in a trust fund until the legal issues are resolved, in order to protect the money Novell says it's owed. If the judge in this case (who's also the judge in SCO v IBM), grants those preliminaries, SCO will have no money at all to continue in business -- much less to sue IBM, Novell or Linux users.
And that's just the preliminary injunction. If SCO survives that, SCO still has to explain why it hasn't abided by the terms of the contract it inherited when it bought the Unix assets from Santa Cruz Operation. And unless SCO can find a remarkably well-hidden loophole that absolves it of the 95% cut that Novell is due, SCO will still owe a lot more money than it's got.
And remember, that's SCO's best-case scenario. There are still disputes about whether SCO improperly made and cancelled Unix licenses and who owns the Unix copyrights. SCO would have to win every point just to stay alive in its suits against IBM and the others.
SCO's worst-case scenario: SCO drops dead -- and very soon.
Stay tuned.
Doh!
Yup. I've been saying for months (if not years)--SCO's going down.
by the sounds of it that should be Novell's name not IBM's
And in constrast to their usual bluster,
SCO have been as quiet as a tombstone
about the Novel filing.
The principle concern in the open source
community is that SCO might now collapse
before some key Unix IP issues get fully
settled.
True, but that was the cartoon I found. :( It's kinda old--before Novell filed their suit against SCO.
LOL!!
So what are the odds that Novell will acquire the assets of SCO and pursue the lawsuits?
i'll bet even the EULA inventors are surprised the SCO suits got as far as they did without any evidence! the SCO guys on the front line got their money already selling the stock a few years back when all the hype (and SCO stock) was at its peak and the sheep who bought SCO stock from them are the ones holding the bag when the stock finally makes the plunge to zero...
High
...and pursue the lawsuits?
None. Novell owns, develops, and distributes a GPL'ed Linux distro.
Considering that Novell is committed to a Linux strategy and now owns SuSE, there is no chance.
LOL -- SCO is the "suicide bomber" in this war.
Actually, the FUD was beneficial to Linux.
There is no such thing as bad publicity.
Furthermore, Linux withstanding this first assault makes it a much more viable enterprise solution.
With no chance of escape, would it matter?
yet some companies will not (and should not) commit to Linux until the IP status of Linux/OSS is settled judicially: in this sense, something like the SCO suit was preordained and both Linux and Open Source will (hopefully) come out of this stronger than they went in...
Tagline update ping
Indeed. I want to see this litigated to conclusion. We need some certainty regarding our whacky IP and copy right laws.
The proof is that Linux has increased penetration since the SCO farce began.
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