CowboyNeal Looks Back at the SCO-Linux Trials

CowboyNeal Looks Back at the SCO-Linux Trials 157

Posted by samzenpus on Monday August 20, 2012 @01:15PM from the read-all-about-it dept.

This past week, SCO filed for Chapter 7 bankruptcy, which finally begins the end of a long saga that started over nine years ago. While their anti-IBM litigation has risen from the grave and still shambles onward, the company itself is nearly put to rest after nine years of choosing the wrong legal battle to get into. Even if it may be too early to dance on SCO's grave, join me as I look back over the long and bumpy road to nowhere of The SCO Group.

The Beginning, or, We Sure Do Miss Ransom Love Around Here

Back in January of 2003, SCO announced that Unix SYSV code had been misappropriated into Linux. They didn't say much more than this, saying that they would only reveal the code in question to the court, and that it was a secret. Given the nature of Linux, this set off the BS-meters of nearly anyone with a clue, including the Linux kernel developers, not the least of which being Linus himself. In March of that year, SCO announced that they owned the copyrights to Unix, and that they were suing IBM for a billion dollars, for leaking SCO trade secrets into Linux. When people who had a clue thought about the case for more than a few minutes, they remembered back to the USL v. BSDi case that had been settled a decade prior, and figured SCO was full of it. Unfortunately, instead of SCO's announcement being taken as the ramblings of a crazy CEO desperate to increase the value of his flagging company, it went ahead. The worst part, is that at least for the short term, it worked. SCO's stock price shot from under $2/share to over $20/share in six months.

Around this time, a new champion would arise. A new website, Groklaw, run by paralegal Pamela Jones began blogging daily coverage of SCO v. IBM. While Groklaw was originally intended as a way for PJ to practice blogging, it soon grew into the front lines of the PR war against SCO, a war which they were losing badly.

This is where the case should have been thrown out, and everyone gone out for beers and had a good laugh, but that didn't happen. However, a new challenger would appear. In August of 2003, Red Hat sued SCO to try and put an end to this mess. While this was a valiant effort on Red Hat's part, ultimately a judge would stay the case pending the outcome of SCO v. IBM. Those hard-earned beers would have to wait.

At this point, SCO's claims were sounding dubious at best, so they showed off two samples of alleged copied code at a reseller show later that month. However, the code in question was shown to be part of BSD, and previously released under the BSD license. In spite of this, SCO decided that to save face, they should waste everyone's time with continuing their warpath of litigation.

SCO v. Everyone

Since the suit against IBM was going so well, The SCO Group came up with the brilliant strategy of "sue all the things!" and proceeded to do just that. In lieu of having their own product that people actually liked and used, they figured they could just sue their way to profitability.

One of SCO's key claims was that they owned the copyrights to Unix, due to some purchases they'd made from Novell. Novell, however, didn't take this sitting down and respectfully disagreed. For butting in on SCO's new business model, Novell was served with a lawsuit in January of 2004. 2004 was the year that SCO decided to sue everyone they looked at. AutoZone, who had recently switched from using SCO OpenServer to Linux, got sued for doing so. DaimlerChrysler was just walking down the opposite side of the street and accidentally made eye contact with SCO, and they got sued as well.

While also suing everyone in sight, SCO also announced that they would not sue their own customers, so for the price of a SCO license, a company could exclude themselves from possible litigation. A few companies actually bought into the madness, but for the most part, the world collectively rolled its eyes at SCO, meaning that SCO would have to soldier on with their lawsuit-based business strategy, or face the wrath of their shareholders.

Novell Jams SCO's Gears

A few years went past while the SCO v. IBM case was still in the discovery phase, with SCO not wanting to reveal the code they were suing over, without seeing sources from IBM first, and IBM not wanting to give SCO any source without first being told what code was in question. This provided time for the Novell case to advance, albeit also slowly. By 2007, Novell was awarded several summary judgements, and several of SCO's claims were denied. By 2008, Novell had been awarded over $3 million as a result of the case. Just under half of that amount would be appealed by SCO, and temporarily reversed for a couple of more years. The main outcome here, however, was that Novell was ruled as the owner of the Unix copyrights.

The SCO legal juggernaut, however, would not, nay, could not be stopped. Despite not owning the Unix copyrights they contended they were the owners of "control rights" to derivatives of SYSV, and for the period during the appeals to SCO v. Novell, they were still able to claim potential ownership of the Unix copyrights in court as well. When they finally lost the appeals, they were forced to fall back to their claims of control rights, which is where they still stand today.

Being faced with having to pay out to Novell, SCO finally received its first nail in its coffin. Following the Novell ruling, SCO filed for Chapter 11 bankruptcy, and SCO v. IBM was stayed until SCO could emerge from Chapter 11 and continue the case. Shortly thereafter, SCO's stock price fell to under $0.50/share and they were de-listed from NASDAQ.

The End of SCO, but not of SCO v. IBM

So that's where we are today. Once the Chapter 7 filing is finalized by a judge, SCO will cease to be as a corporate entity, however they are proposing that SCO v. IBM be allowed to continue, not for sheer entertainment value, but rather so that they don't risk the wrath of their shareholders.

Nine years on, it's difficult to say who the real winners are. It's definitely not The SCO Group themselves, since they've gone under. It's also probably not SCO's lawyers, since their chances for being paid are greatly diminished since SCO's short-lived high times in 2003. IBM stands poised to win the case should it go forward, however their legal expenditures at this point are so large they could only be fielded by the likes of IBM. Novell, despite having already won, may not ever get paid all that it's owed. Linux users will most likely eventually emerge as not having to pay SCO a dime, which while is nice to have reaffirmed, is where they were back in 2003 to begin with. Another side effect of the courts rulings, was the reaffirmation of USL v. BSDi, which means that FreeBSD users are definitely safe from licensing fees and litigation.

While I've given an overview of the SCO-Linux litigations here, I've surely missed many of the bumps in the road. I only briefly touched on the PR war SCO fought against Groklaw, and many of the other insanities brought on by this case. With SCO v. IBM still possibly lunging ahead in a stupor, it may be too early to finally enjoy those aforementioned hard-earned beers, but it's still safe to chill them with the ice off SCO's corpse.

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