Stay Lifted, Novell Vs. SCO Can Go Forward

A number of readers suggest we check out Groklaw, where PJ is reporting that a bankruptcy judge has granted Novell's request to lift the stay so that its trial against SCO can proceed in Utah. The judge concluded that Judge Kimball is the best one to decide how much SCO owes Novell, and that SCO cannot make any "reorganization" plans — including any "fire sale" of assets — until it knows this figure.

Horrible things?

[steveha]

PJ ended the article with:

So it's back to Utah they go. I'm sure SCO's lawyers can't wait to see Judge Kimball again, after all the horrible things SCO's CEO Darl McBride said about Judge Kimball to the press.

I'm interested to read just what Darl McBride said. I just Google searched for it and didn't find anything.

Could someone please post links to some of the "horrible things"?

The system is b0rked!

[trolltalk.com]

"The system works..... it works slowly, it costs huge amounts of money, but it does work......"

Three simple reasons to say "the system" does NOT work:

1. justice delayed is justice denied - and it was obvious a LONG time ago that this was a frivolous case
2. justice might be blind, but its even MORE blind if you don't have $$$$
3. justice's slow wheels allowed Darl and Co to pocket a LOT of money over the last 5 years, enabling their dump-and-pump scheme.

Justice my arse! If the software industry worked as slowly as justice, and as expensively, we'd be using a $5,000 abacus instead of a computer.

Think of it - there's still all the BS appeals. Justice isn't looking all that appealing now, is it, unless you, like justice, are blind AND slow.

Re:Horrible things?

[Col. Klink (retired)]

He said that Kimball was overruled on appeal two thirds of the time. It is, of course, not exactly true [investorvillage.com].

Here's a link

[DrJimbo]

I'm interested to read just what [horrible things] Darl McBride said. I just Google searched for it and didn't find anything.

Here is a link to Computer World Malaysia [computerworld.com.my]:

Behind the scenes, though, McBride said SCO's legal team has unearthed some details about Kimball's rulings that may provide a glimmer of hope for his company's ongoing fight.

"There's one little tidbit that we came across just a few days ago," he said. "Whereas the popular press has said, O.K., this thing is now over, there is an appeal process, and the other fact is that if you look inside that appeals process and you take a microscope and look at the record of Kimball's summary judgement rulings that have gone to appeals, he gets overturned the vast majority of the time. It's nearly two-thirds of the time. That was something I was a little curious about myself.

"This apparently is a [judge] who very regularly, the majority of the time, gets [overturned] when it goes to the replay booth. That's the one sort of a news fact that's not out there today that [could] maybe temper some of this enthusiasm out there" about SCO's troubles. "He certainly has a dismal record on appeals."

Like most other things coming out of Darl McBride's mouth, these words would have been less "horrible" had they been true. I swear, if that man says it is a clear day you'd best bring your umbrella. He seems incapable of telling the truth.

She'll talk about the constructive trust.

[Jaywalk]

From the court decision:

However, while the stay will be lifted in order to enable the District Court to determine the License Issues, this Court will determine whether a constructive trust is appropriate because it is the very essence of a bankruptcy court's jurisdiction to decide what is property of the estate.

The constructive trust is a big deal because it would immediately remove a chunk of money from SCO's hands, handicapping SCO's ability to pursue the lawsuits. However, in practical terms, it probably doesn't make a difference. If Kimball sets the dollar amount SCO owes Novell anywhere near the amount expected, it means Novell becomes SCO's chief creditor and head of the creditor committee [usdoj.gov]. From there, Novell largely calls the shots in any "reconstruction" plans SCO proposes. One of Novell's options would be to request to convert the bankruptcy from Chapter 11 to Chapter 7 based on the fact that SCO has never been able to make money, aside from what they "converted" (a.k.a., "stole") from Novell.

In any case, just because Judge Gross is reserving the right to order a constructive trust for himself doesn't mean he won't decide to order one once Kimball rules anyway.

In bankruptcy, that's reversed.

[Animats]

The reason SCO was able to do that is that while the system is designed to thwart foot-dragging by defendants, it doesn't do as much to prevent foot-dragging plaintiffs.

Right. But in bankruptcy court, that's reversed. The debtor isn't in charge. The court, the U.S. Trustee, and the creditor's committee are. Notice how, since SCO declared bankruptcy, their wierd legal moves have been shot down fast. SCO's "emergency motion" for a quick sale - deferred by judge without even asking SCO. Quick asset sale to York under wierd conditions - withdrawn once the creditors objected. Novell lawsuit - unstayed.

Judge Kimball's calendar has an open day on December 11.

Re:Well good.

[Arguendo]

You don't need any evidence to file a lawsuit. There's a lot of reasons for that, but one of the most important ones is that often it's the defendant who has got the evidence. That's particularly true in employment discrimination cases for example. If the courts required evidence just to file, a lot of people wouldn't get their day in court and the justice system wouldn't function as intended.

I'm not going to defend SCO by any measure, but they would probably say that they didn't have any evidence because Novell was hiding it all. And that they need discovery to get the incriminating emails, meeting agendas, testimony from employees, etc. So there's a lot of discovery for you.

The whole process sounds very odd and wasteful from the outside, but there is a legit reason for the way things work. A cheaper alternative is arbitration, which we all agree to whenever we click "I accept." So maybe that will change soon, but I don't necessarily think that will be to consumers' benefit.