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SCO Proposes Sale of Assets To Continue Litigation
Posted by
Soulskill
on Sun Jan 11, 2009 01:18 PM
from the know-when-to-fold-'em dept.
from the know-when-to-fold-'em dept.
gzipped_tar sends in this excerpt from the Salt Lake Tribune:
"The embattled SCO Group Inc. is proposing to auction off its core products and use proceeds to continue its controversial lawsuits over the alleged violations of its copyrights in Linux open-source software. The Lindon company has filed a new reorganization plan with the federal court in Delaware where it sought bankruptcy protection from creditors after an adverse ruling in the Linux litigation. If approved by a bankruptcy judge, the plan could mean SCO's server software and mobile products lines are owned by other parties while SCO itself remained largely to pursue the lawsuits under the leadership of CEO Darl McBride. 'One goal of this approach is to separate the legal defence of its intellectual property from its core product business,' McBride said in a letter to customers, partners and shareholders. Jeff Hunsaker, president and COO of The SCO Group, said the litigation had been distracting to the company's efforts to market its products. 'We believe there's value in these assets and in order for the business to move forward it's imperative we separate it from our legal claims and we allow our products business to move forward,' he said Friday."
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News: Final Judgment — SCO Loses, Owes $3,506,526 265 comments
Xenographic writes "SCO has finally lost to Novell, now that Judge Kimball has entered final judgment against SCO. Of course, this is SCO we're talking about. There's still the litigation in bankruptcy court, which allowed this case to resume so that they could figure out just how much SCO owes, which is $3,506,526, if I calculated the interest properly, $625,486.90 of which will go into a constructive trust. And then there's the possibility that SCO could seek to have the judgment overturned in the appeals courts, or even the Supreme Court when that fails. Of course, they need money to do that and they don't really have much of that any more. Remember how Enderle, O'Gara and company told us that SCO was sure to win? I wonder how many people have emailed them to say, 'I told you so.'"
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Wow. Just wow. (Score:5, Interesting)
That depends upon his job. (Score:3, Interesting)
If he finds a buyer (or buyers) for the products that pay enough for those products then SCO gets a lot of money. Some of which could be direct towards himself and the other execs as bonuses or whatever.
Now, if you question whether he can find a buyer willing to pay that much for a dying product, just remember that he has found investors and partners before who seemingly pay millions of dollars for nothing.
Right now, his job is to drag this case out.
McUnix (Score:5, Insightful)
SCO has a market cap of just over $3 million [yahoo.com]. IIRC, McDonald's Corp is one of their major customers. That $3mil is pocket change for the $66.95 billion [yahoo.com] market cap McD's Corp.
What if McDonald's buys SCO? McD's could hire a couple devs (since that is all SCO needs, apparently..) for maintenance and some support personnel, then service their own stores as well as other existing customers. Maybe they'd wind up saving, if not making, some money in a few years. Perhaps give Darl a store to manage...
Heh. :)
Point being, with a market cap of only $3mil, SCO and anything they have/own are basically chump change for a real corporation. So, if the judges (have) let this happen, then, and I hate to even think of it, we'll see this zombie keep stumbling forward...
Parent
Re: (Score:3, Funny)
Re: (Score:3, Funny)
Re: (Score:3, Interesting)
What if McDonald's buys SCO? McD's could hire a couple devs (since that is all SCO needs, apparently..) for maintenance and some support personnel, then service their own stores as well as other existing customers. Maybe they'd wind up saving, if not making, some money in a few years. Perhaps give Darl a store to manage...
SCO has several POS installations. The biggest complaint I heard from my coworkers that has sco experience when I was a unix admin was rebuilding the kernel. Apparently, you had to use some sort of linker to add drivers to the kernel. The second biggest was modern hardware support.
For B&W POS terminals these things are not concerns. If McDonalds bought all the source code outright, they could probably port everything to another unix in 6 months. A smarter move would be to work out some kind of deal wher
Re:McUnix (Score:4, Interesting)
Another possiblity is for McDonald's to buy SCO and then lhave the POS software ported to another platform. There are many, and Solaris might be the winner there.
Then SCO can truly die.
ps- This would be very difficult for the bankruptcy judge to turn down. Might be cheaper to McD's than licenses. Would still give ignat money to pursue his stupid suit.
Parent
Re: (Score:3, Interesting)
your forgetting the problem. The core products are what has been sued over. Darl can't sell them and continue the lawsuit as they wouldn't be the owners of the products anymore.
Not only is this proposal nearly two weeks late(it was due Dec. 31) This destroys the company and any potential assets creditors may have access to recoup their losses. Only a naive bankruptcy judge would allow the only asset a company has to be sold for literally nothing.
What's worse is that those products are only worth maybe 5
Re:Wow. Just wow. (Score:4, Insightful)
If you buy into the entire Microsoft paid them to spread FUD about Linux conspiracy, this actually plays directly into it. Vista wasn't the prize puppy MS was wanting it to be. With the economy going down and all of Vista's happiness, companies and people are looking at the FOSS routes a little more. What better way to battle that and ensure MS had a viable product until the economy recovers and windows 7 is making money then to re-raise the Linux is illegal battle.
Or in other words, nothing is wrong with him that wasn't already wrong with him. He is just needed one more time. I suspect MS or some affiliate of MS is more then willing to buy off the assets.
This all makes sense if you don't look at him as the CEO of SCO but the employee of a dieing company who is looking to the future.
Parent
Re:Wow. Just wow. (Score:4, Funny)
Parent
Re:Wow. Just wow. (Score:4, Funny)
In this economy, Darl knows he will never get another job as an executive. I mean how the hell can you spin his tenure as CEO of SCO on a resume? I guess you could say something like "leveraged corporate IP" -- just leave out the part about "just not OUR corporate IP. Heh." And maybe "worked with compliance and legal department to partner with the titans of the computer industry" -- just leave out "it was a forced partnership. Okay, we sued their asses and had ours handed to us on a platter, but still. I've got more balls than brains, it has to count for something!"
I'd suggest "innovative customer relations program", but the MPAA has them beat on that one.
Parent
Re: (Score:3, Interesting)
Am I the only one that is "reading between the lines" of Mr McBride as to saying that the viable business assets (IP/service) that SCO owns are "dragging down" the litigation efforts (distracting from them anyway, loss of focus) and that he wants to get rid of them, to strengthen the litigation business model?
How backwards is THAT?
"Just WOW" indeed... the ability of some people to surpass seemingly insurmountable levels of prior stupidity do continue to amaze me.
Re:Wow. Just wow. (Score:5, Insightful)
In a just world, he will die a homeless drug user on the streets.
Darl does not deserve drugs. How about him dieing a homeless, disease ridden prostitute?
Then the only change necessary is creditors seizing his home.
Parent
Re:Wow. Just wow. (Score:5, Funny)
In a just world, he will die a homeless drug user on the streets.
Darl does not deserve drugs. How about him dieing a homeless, disease ridden prostitute? Then the only change necessary is creditors seizing his home.
Darl does not deserve sex. How about him dieing a homeless RIAA lawyer?
Parent
Re:Wow. Just wow. (Score:4, Insightful)
RIAA lawyers don't deserve death. They deserve a long and very painful and unpleasant life instead.
Parent
Re:Wow. Just wow. (Score:4, Funny)
A job in IT?
Parent
Re:Wow. Just wow. (Score:4, Insightful)
Parent
Re:Wow. Just wow. (Score:4, Insightful)
snip...I hope the bankruptcy judge finds him PERSONALLY LIABLE and sentences him to jail for THEFT.snip...
Hmmm
As stated, I want Darl (& the Sco Group) punished to the maximum extent possible under the law. Darl & Co need to be seen to be punished in such a way that it that acts a deterrent to prevent others from pursuing similar frivolous claims in the future.
I want Darl & Co. punished for all their lies, I want the Sco Group punished for trying to game the legal system, I want the Sco Group punished for every time they ignored Court Orders, I want their assets seized to pay off creditors, I want the law firms to have to disgorge all funds received from tScoGroup after they entered chapter 11 to help pay off creditors, I want the SEC to investigate tScoGroup and the statements that were made to the court that appear to be different / contradict statements that were made to the SEC...
Executive summary, I want justice to be done and to be seen to done. Dying a horrendous death is not justice (not even poetic justice), and it is certainly not deserved for what tScoGroup actually did...
Parent
Professional guild (Score:4, Insightful)
The law is unjustly lenient in cases like this precisely because it is being abused by lawyers, and most laws are written by lawyers. I don't know anyone else who could write them, but it creates an inherent bias in favor of those acts that lawyers perform and others don't. And in favor of those acts that people who hire lawyers perform and others don't.
Lawyers will tend to work with other lawyers because they are both... lawyers. They are part of a guild, a professional brotherhood, united by common experience and training. Whether this is a bad thing is a matter of opinion, but it's a reality shared among lawyers, and any other professional group.
Think about it; when you start talking about firewalls, routing tables, and process management, are you going to consider the input of somebody who is clueless about such things over somebody who knows the difference between a default deny firewall and a NAT firewall?
And to every non-techie person who has to try to work with you, aren't you going to seem a bit, eh, elitist when you pay close attention to an arsehole who is speaking intelligently while ignoring the non-techies, who use words like "series of tubes" to describe technical details?
This isn't an issue with lawyers, it's an issue with all of mankind. Doctors listen to other doctors and ignore "lay folk". So do IT/techies, contractors, politicians, lawyers, accountants, mechanics, engineers, architects, scientists, and pilots. A techie thinks the technically insecure doctor is an idiot for not installing an anti-virus or doing backups. The doctor thinks an unhealthy techie is an idiot for not losing weight and quitting smoking.
Welcome to life, folks. You cast the shadow you leave behind. It's OK - it's just humanity, each making judgments according to their own experience!
Parent
what core product business ? (Score:5, Insightful)
Then why not drop the case and focus more fully on your 'core product business'
Re:what core product business ? (Score:5, Funny)
Then why not drop the case and focus more fully on your 'core product business'
At this point he pretty much is.
Parent
You've got to understand what Darl is doing (Score:5, Insightful)
Parent
No SNCP, no Arab sheik (Score:5, Insightful)
They want to pay Novell in worthless stock.
And the directors will get their pay in worthless options going forward.
It's amazing how long this zombie company can stay on its feet.
Re: (Score:3, Funny)
It's amazing how long this zombie company can stay on its feet.
So that's why Darl and the other directors at the last board meeting kept saying, "Brains! brains! We need brains!"
Re: (Score:3, Funny)
Is groklaw aware of this new development? (Score:5, Insightful)
The recent story of their cessation to "compile" the history of the case seems a bit premature now.
That said, I'm beginning to wonder if Darl is playing "weekend at bernies" with the board of directors, because no sane board would authorize the liquidation of the bulk of a company's assets so an obsessed executive can go tilting at windmills.
Re:Is groklaw aware of this new development? (Score:5, Insightful)
> because no sane board would authorize the liquidation of the bulk of a company's assets so an obsessed executive can go tilting at windmills
The decision was made by Ralph J. Yarro III back in 2003 to tilt at the windmill. Darl was hired to lead the charge. Back at the beginning Darl said SCO would pursue this to their "utter destruction" if need be. Well it looks like they are.
History: SCO, then called Caldera, was Novell's proxy in the DRDOS lawsuit against Microsoft. This lead Yarro, then managing the Canopy investment company that effectively had full control of SCO/Caldera to look for new lawsuit opportunities to cash in on. The decided to attack Linux using their "UNIX IP". To bad there is no UNIX IP in Linux.
The court system that allows civil cases of this nature is really to blame for the whole thing. SCO's lawyers are now heavily "invested" in the case (at one point they were literally going to be investors in SCO, but then changed their minds to cash up front) and are not really working for justice, but for their piece of the litigation reward pie.
Parent
Re:Is groklaw aware of this new development? (Score:5, Insightful)
Uh, they're still referring to UNIX IP being property of SCO?
Just how is this possible? It's well-known that Novell owns UNIX IP (maybe not the trademark, but the copyrights, etc. to the code) and as the owner of Unix IP, Novell obviously has no objection to Unix's affecting Linux, since Novell is distributing Linux pretty aggressively.
On top of that, even if there were Unix code, or even SCO-authoried UNIX code in the Linux kernel, SCO themselves distributed that same code under the GPL releases as Caldera Linux, and later on, SCO Linux.
Want to know the saddest part of this?
Prior to Darl's influence, Caldera was a great company. They were founded by former Novell folk who were avid supporters of Open Source. Not free as in beer, but free as in speech, where if you buy a product, you not only get the binaries, but the source so you can fix bugs in the event that the product ceases to be available. They brought DR Dos back to life (and sued Microsoft in the process for their anti-competitive tactics).
They introduced Caldera Linux, which was a bit ahead of its time. Online repositories accessible through a decent GUI, network management through a usable GUI, and a somewhat polished (for the time) desktop environment, all as open source. The "open" nature of it was touted heavily on it, and although it wasn't my primary OS at the time (I had to work a LOT of hours from home on Windows projects so I dumped Linux for a few years, unfortunately) I liked it a lot.
Caldera was very open and very pro-open source. The founders saw the vision and potential of open standards. I don't know exactly what prompted the change which brought that shark Darl in, but Caldera was very focused on poising themselves for the open source revolution and the potential for "value-added" services, using the "free/free" aspect to gain market penetration.
Keep in mind what Caldera was doing then is what Novell and Canonical are doing now, and it's somewhat ironic that SCO (formerly Caldera) was founded by ex-Novell employees who shared the same vision that Novell has FINALLY embraced in recent years.
Parent
Re: (Score:3, Insightful)
to say there is no UNIX IP shows your lack of imagination.
IP is not imaginary.
IP is the epitome of imaginary.
Re:Is groklaw aware of this new development? (Score:5, Informative)
Facts are SETTLED in the trial court. Once the trial court enters its judgment, those facts are set in stone.
Facts can be undone on appeal only if no reasonable factfinder could have found the challenged facts AND if the party appealing has complied with all the procedural requirements. Thanks to the lawyers, Groklaw, and others, that just isn't going to happen in this case because there is too much evidence supporting the decision of the trial court.
Facts almost NEVER get rewritten on appeal. The rules are tremendously slanted against that. If a fact gets undone on appeal, the issue gets sent back to the trial court for a new fact determination.
Groklaw's purpose was help in the development of a factual record in the trial court against SCO. As discussed above, there is no need for factual development on appeal. If the trial court must in the future decide some new facts, Groklaw will doubtless spring into action, but that isn't likely.
Parent
Kinda refreshing, actually... (Score:5, Insightful)
I love the fact that they're willing to sell the very products they're supposedly protecting from unauthorized use of "their" code, just to keep the legal fight going.
What products? (Score:5, Insightful)
What company would want to adopt or standardize on a product developed by a company that is, for all intents and purposes, dead? Everyone has moved on, be it server side apps or embedded, there are ample companies that have a superior product with a healthy roadmap and no indication that they will not be around in 5 years.
Deck Chairs (Score:5, Funny)
Re:Deck Chairs (Score:5, Funny)
Queue incoming litigation against Balmer for the concept of 'throwing chairs' in 3... 2... 1...
Parent
Correction and prediction (Score:5, Interesting)
Where is reads :
Jeff Hunsaker, president and COO of The SCO Group, said the litigation had been distracting to the company's efforts to market its products.
it should read :
Jeff Hunsaker, president and COO of The SCO Group, said the efforts to market its products had been distracting to the company's main litigation activity
There, that's it.
Now a prediction. I predict that they are going to find a very generous buyer, that will pay much, much more than the market value of the actives, allowing the new, rather hollowed-out SCO to keep on litigating for years. Call it a hunch.
Yup. That's right. (Score:3, Informative)
And this time it'll be more than one step removed from the real source of the money. [zdnet.com]
...to customers, partners and shareholders. (Score:4, Funny)
McBride said in a letter to customers, partners and shareholders.
ie.
McBride said in a letter to his father-in-law, his wife and his mistress, and his grand parents.
Somehow, this reminds me ... (Score:5, Funny)
... of the Black Knight in Monty Python's Holy Grail.
"None shall pass!"
In other words, play hide the assets (Score:5, Insightful)
It sounds like they're going to sell their assets off to someone else, leaving SCO as just a shell from which to continue the lawsuits and hide away the assets from future claims against them.
Wait wait wait, hold on a sec... (Score:3, Funny)
The embattled SCO Group Inc. is proposing to auction off its core products
SCO actually sells a product?
if no sale, 10% cut in 280K salary (Score:5, Interesting)
Ah but if the sale fails to raise sufficient cash the company directors will take a 10% cut in their salaries.
Is $280k a year a good salary for a CEO of a company that is in bankruptcy and has so far burned through $0.25B of investor capital.
Oh and there are only 66 employees. I would bet your nearest grocery store is larger than that.
Government Bailout for SCO (Score:5, Insightful)
I'm actually a little shocked that they haven't requested government financial assistance. It seems to be all the rage for companies with poor products, insane leadership, and failing business models.
mod this flamebait if you want, it's still true.
Beyond Horrible. (Score:3, Interesting)
Hmm... how is this any different from... (Score:3, Insightful)
Bernie Madoff allegedly stashing millions of dollars in checks in his desk (and who knows where he's stashed all sorts of $$$ in international accounts), getting ready to send it somewhere where the System can't touch it when all is said and done?
I would really argue that SCO Group should not be allowed to do this, as it is in essence allowing them to transfer assets out of the company so that they cannot be used to pay the company's legal obligations when all is said and done.
If you or I do it, say, to shelter/shed/disburse assets prior to a divorce settlement, bankruptcy or other judgment action (i.e., we attempt to shed assets after filing for bankruptcy), we get pilloried.
Giving up pretense (Score:4, Interesting)
SO, SCO wishes to give up any pretense of doing anything productive at all now or ever again so they can divy up the only remaining value amongst the lawyers and executives and have nothing left to pay their creditors. It sounds like they've also given up all but the slimmest pretense of even attempting to provide ROI for their stockholders.
It's the other way around: (Score:3, Interesting)
SCO is not selling its main core business and people. The main core and people (that's: SCO) are separating themselves from the sinking ship of McBride and his obsessive lawsuit disorder.
That's the problem with leaders with a strong reality: When they're wrong, it takes a looong time for people to realize this and move away. And it takes an even longer time, for them to realize it themselves. This is, because such a strong self-induced confidence has the risk of becoming delusional.
A delusion can only exist for that long, if the person has built a very rigid and interconnected system of values, where everything depends on everything else. So he can't pull that one thing, without destroying everything else in the process, causing his whole reality to break down. A state that equivalent to death for the human mind.
Even followers can suffer from this effect.
McBride now has a strong neurosis, forcing him to go 'till the very end... unless someone offers him a way out, that lets him keep his reality. Or to be more exact: His self-acceptance of being good and right in what he does and did. It's either that, or a deathlike experience.
If anyone who knows him personally reads this: Give him that way out. Offer him a way, that lets him go up in self-respect when follows it. And you will see this whole obsession, all the lawsuits, and his whole way of acting go away in a blink of an eye. He will suddenly be Ok with saying that all what he did was not the best thing to do. But he will have a reason that this is Ok for him anyway.
By any means: Do not put more pressure upon him. He will only fight harder. Remember: His other choice is death(like). So he will oppose you up to that level. Ok... except if you're really evil and actually want that to happen. ;) But then, how would you still be better than him??
Re: (Score:3, Funny)
Hrm..
Perhaps IBM could buy them and write itself an unconditional irrevokable retroactive perpetual license to the products. And release them under GPLv3...
should IBM buy SCO? (Score:3, Insightful)
Perhaps IBM could buy them and write itself an unconditional irrevokable retroactive perpetual license to the products. And release them under GPLv3...
That would be terrible, least of all for IBM. Between IBM and Novell SCO is on the ropes and it should die. Actually I think an IBM buyout may of been in Darl McBride's and other's mind when they filed their lawsuit against IBM, hoping IBM would offer to buy SCO.
Falcon
Re:They don't want to be able to pay Novell/IBM (Score:5, Informative)
That's one of the reasons so many companies incorporate in Delaware.
Parent
Re:So what? (Score:4, Funny)
Parent