07.26.08

SCO’s Debt to Novell and Sun’s Debt to Novell?

Posted in Law, SCO, Novell, UNIX, Courtroom, SUN, IBM, Kernel at 4:15 pm by Roy Schestowitz

Steven continues his fascinating series of analyses which revolve around UNIX and its so-called “imaginary property” (IP). The latest of Novell/SCO was mentioned 3 times a week or so ago [1, 2, 3]. This is a catchup post.

Here is another explanation of why Novell — and by association Microsoft — becomes more of a threat to ‘Open’ Solaris.

Here’s how it works: Novell owns Unix’s IP (intellectual property). SCO sold Unix’s IP to Sun. Sun then included some Unix IP into Solaris. Finally, Sun open sourced Solaris as OpenSolaris. Sounds like trouble, doesn’t it?

While Sun’s Chief Open Source Officer Simon Phipps described the line of logic above as “sheer speculation,” others see a major potential legal problem for Sun. However, analysts, lawyers and open source leaders also agreed that it’s unlikely Novell would ever choose to make trouble for Sun. Novell, however, has not commented on its intentions despite several attempts to get the Linux company’s take on the issue.

Sun Microsystems is no great foe of GNU/Linux, but then again, as the now-promoted Simon Phipps put it, Novell’s leadership does not keep up. His take was joined (or followed) by others at Sun [1, 2]. There’s some friction between Novell and Sun, which gets along best with Canonical.

Elsewhere in the news, there was plenty of coverage of SCO’s need for money that it has already spent. From ECT:

SCO will have to shell out more than $2 million to Novell for licensing Unix to Sun Microsystems, a Utah judge has ruled. The dispute in part hinged on whether Novell still owned pre-1995 copyrights to Unix, which it sold that year to SCO. The judge last year ruled that Novell in fact did own them.

[…]

A SCO company statement indicated the company will appeal Kimball’s ruling from last year and said it continues to disagree with the premise of the May trial. At that proceeding, SCO contended the case should have gone to trial on its original claims that Novell was interfering with its ownership of Unix.

“We are pleased, however, that the court agreed that Novell is not entitled to anywhere near the more than $20 million dollars it was seeking,” the SCO statement said.

Linux Journal had a go at it too.

The ruling, which comes nearly three months after the four-day bench trial concluded, was a mix of victories and defeats for each party, though Novell clearly came out ahead. The big victory was the court’s determination that SCO lacked authority to enter into its agreement with Sun Microsystems, and as a result, owes Novell just over $2.5 million (plus interest).

Unix For a sense of completeness (because you only live once to witness the end of SCO):

Here is one which is more of an Op-Ed:

The SCO Group got bad news in court last week. Not an unusual event for this company, but I wish the need for such events would finally go away for good.

I’ve now been writing about SCO for five years — how time does fly when you have someone to despise. In my first column about SCO’s decision go into the lawsuit business rather than having to do all the hard work of making a product that someone might want to buy, I thought that someone would just buy the slime off. I was wrong — I guess there is some truth to the punch line of the old joke that “there are just some things a lawyer won’t do.” I guess IBM’s lawyers could not stomach the idea of rewarding such repulsive behavior.

There was also a semi-formal statement from Novell:

Novell issues statement on licensing fee dispute with SCO — Novell Inc. on Monday issued a statement about last week’s federal ruling in which the SCO Group was ordered to make $2.6 million in restitution to the Waltham, Mass. software developer.

That restitution amount is significantly lower than the $19.9 million Novell sought for what it called “unjust enrichment” by SCO because it collected royalty payments on Unix licenses from Sun Microsystems and other Linux users of Unix software without Novell’s approval and allegedly refused to account for them.

U.S. District Judge Dale Kimball, in a ruling issued last Wednesday, found SCO “breached its fiduciary duties” to Novell by failing to account for the revenues SCO received from Sun for rights to opensource its own version of Unix products called OpenSolaris. That Unix product is based on the SVRX code, which Kimball on Aug. 10 determined Novell to be the owner.

“We think this is great news for Novell and for the open source community. We’re very pleased this ruling reaffirms and strengthens Novell’s ownership of the UNIX SVRX copyrights and vindicates Novell’s continuing efforts to protect the open source community from SCO’s claims,” Novell said in Monday’s statement.

“This ruling underlines the court’s earlier decision, issued in August 2007, which found that Novell, not SCO, owns the copyrights to UNIX SVRX code, and further undermines SCO’s claims against Linux users,” according to the statement. “We see a pattern in the legal judgments made in this case: Decision after decision makes it clearer and clearer that SCO’s legal claims against Linux have no merit.”

The statement is also available from here. █

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