Novell to SCO - Pay Up

gosherm writes with word that, now that the dust is beginning to settle on the long-running SCO case, Novell wants to get paid. Now. They're requesting that the customary stay on SCO's finances (as a result of their bankruptcy) be lifted so that Novell can begin recouping some of its losses from the protracted legal battle. "'We need to adjudicate if this is money owed to Novell or if it is Novell's property,' said Bruce Lowry, spokesman for Novell. That could determine how quickly Novell can recover those funds. And time is of the essence since there's a possibility SCO 'may run low or even completely out of cash during the process of trying to reorganize,' Novell said in court documents filed Thursday. Novell is also trying to protect royalties SCO collects from Unix and Unixware software licensees and remits annually to the software developer. SCO is required to continue to remit between $500,000 and $800,000 annually to Novell -- the next payment is due Nov. 14. SCO remitted $696,413 to Novell between the third quarter of 2006 and the second quarter of this year."

First thing that comes to mind

First thing that comes to mind... [seomoz.org]

SCOX SUX

Well, literally. Or more correctly, SCOX got sucked down the drain.

out of money

there's a possibility SCO 'may run low or even completely out of cash during the process of trying to reorganize,

We can only hope.

Re:out of money

Except the big problem is they are focused or reorganising all the cash that is left into Darl's pocket. It'd say get security to escoprt him out and call in the liquidators.

Re:out of money

there's a possibility SCO 'may run low or even completely out of cash during the process of trying to reorganize,

We can only hope.

Actually, that's the last thing we want. If SCO goes Chaper 7 (gets dismantled) before Novell gets a ruling against it, then they've won a partial victory.

Right now, SCO hasn't yet been defeated completely in the courts. They're mortally wounded but still standing. SCO needs to be an instance where they're made brutal example of. The result can't be "SCO ran out of cash arguing its claims", but rather "SCO's claims were baseless and found so by the courts". Given the power of the spinmeisters, the issue isn't resolved until the Novell case and ideally the IBM case are decided against SCO.

Then there's the SCO execs themselves. Personally, I think that they need to be brought to justice for their perversion and mockery of the US judicial system, and also for their stock antics. People like Darl McBride have gotten rich off of this whole thing. I want their butts behind bars, or at least under suit for malpractice or whatever. If they can walk out profiting from riding SCO into the ground and attacking Linux, it'll just encourage other trolls.

SCO is using this bankruptcy time to spend their money in a way that either enriches them or enriches their partners. They're trying to steer their allies onto the bankruptcy committee, and giving huge bonuses to their execs, and hiring temps at exorbitant fees.

Finally, if they run out of money, they can't pay Novell and IBM anything. They owe Novell millions of dollars, with only the amount now in dispute. Essentially, this is Novell's money they're burning through, according to the Novell v. SCO judge. They probably owe IBM some money too on the counterclaims (if they ever get to them).

Re:

Lawsuits these days aren't finished until they've had at least one appeal. Its doubtful SCO can hold on for an appeal so no, there won't be any rulings that the spinmeisters can't spin away.

Re:

They're mortally wounded but still standing.

Come off it. I think everyone on /. knows how this is going to pan out.

Novell: Now stand aside, worth adversary.
SCO: 'Tis but a scratch.
Novell: A scratch?! Your in Chapter 11!
SCO: No we're not.
Novell: Well w

Re:

That is why they are in this trouble. Part of the victory for Novel was that SCO had to pay the money it made from right to use Unix. Which MS Paid for. If MS Didn't Pay for these licenses That would be a lot less that SCO will have to pay.

Where is Darl's big mouth now?

Haven't heard from you in a while McBride, cat got your tounge?

Re:Where is Darl's big mouth now?

Well, actually the guy wrote a funny interview a few days ago, on Computerworld. Here it is: http://www.computerworld.com/action/article.do?command=viewArticleBasic&taxonomyName=operating_systems&articleId=9040239&taxonomyId=89&intsrc=kc_top [computerworld.com] On October 1, McBride claimed that the rumors of SCO demise are greatly exaggerated.

Re:Where is Darl's big mouth now?

On October 1, McBride claimed that the rumors of SCO demise are greatly exaggerated.

And on September 18, McBride claimed [yahoo.com] that "[a]s a result of both the Court's August 10, 2007 ruling and our entry into Chapter 11, there is substantial doubt about our ability to continue as a going concern. " He has a lithe relationship with reality.

Re:Where is Darl's big mouth now?

Haven't heard from you in a while McBride, cat got your tounge?

You must have missed this recent interview [wired.com] where Darl once again confirms that most assholes take pride in their self-righteousness and delusion. I especially enjoyed this part:

WN: You knew you'd be vilified?

McBride: In this particular case we're talking about, I joined the company, and we had problems with our intellectual property.... I said we should protect our rights.... The former CEO said, if you do that, you will be vilified by the Linux community. The Linux community will attack you. You will be hated. Don't go down that path.

Well that's not a reason to not step up and defend your property. That's not a reason to stand back and say, "I'm not going to fight." We got attacked, vilified and we got branded as pariahs. When you pay 149 million dollars for a property, do you have the right to defend it or not? I think it's a matter of principle. I think anybody in their right mind who was in my position would have done the same thing if they had half a backbone.

Beautiful, innit?

Re:Where is Darl's big mouth now?

(This is not a defense of Darl, although I'm sure many of you will take it as such in a blind nerdrage.)

So basically, he's saying he did what he believes is right in the face of opposition, and you call him a self-righteous asshole.

Tell me, when RMS does what he believes is right in the face of opposition, what is he?

Re:Where is Darl's big mouth now?

A smelly, hippie, self-righteous asshole? ;-)

Re:

Tell me, when RMS does what he believes is right in the face of opposition, what is he?

Controversial. As usual. What's your point?

Re:Where is Darl's big mouth now?

I believe his point is that there's is nothing wrong with McBride's statement. This is, of course, assuming that SCO did in fact truely believe that they owned what they claim to have owned and that said intellectual property was indeed being infringed upon. Ultimately, the conclusion was that both were false and that they knew it. If anything, it is the latter that they should be villified for. One should not be attacked for simply protecting what one owns as long as one does so in an honest manner. Once again, though, it appears that SCO wasn't exactly being honest. . .

Re:Where is Darl's big mouth now?

So basically, he's saying he did what he believes is right in the face of opposition, and you call him a self-righteous asshole.

The question is did he believe it? What was his so called belief based on? The evidence is that he knew that his belief was not backed up by facts and proceeded anyhow.

He had reports from his own company specialists saying there was nothing yet he gave interviews stating he had a team of MIT deep divers that has found millions of lines of evidence but he couldn't produce either the evidence or the deep divers in court. Why was that?

I and many others don't think he had a belief in the justice of his cause. I think as do others that he was trying to get IBM and others to pay them off without having to prove anything. It obviously didn't work.

Re:

Microsoft shilled out $66 million to someone to produce a FUD campaign. I'd hardly call that working, although I'm sure everyone involved thought and still think it was money well spent.

Re:Where is Darl's big mouth now?

So basically, he's saying he did what he believes is right in the face of opposition, and you call him a self-righteous asshole.

Except that he is wrong about what SCO purchased. What SCO purchased was the exclusive right to license and rent UNIX, as well as decide what OSes can and cannot be referred to as UNIX. What SCO did not purchase, were the copyright or the patents for UNIX. It is fairly clear to anybody that has read up on copyright, that one cannot buy copyright once it has been established, one can buy exclusively world wide rights to a copyright work, just not the copyright itself. The closest thing is paying somebody to create the work, making it a work for hire, but still not transferable later on.

And as such, SCO never had the authority to claim infringement on the copyrights or patents that go along with UNIX. SCO could however sue Linux or anybody else if they claimed that their OS was UNIX, as SCO has the legal right to decide which OSes are or are not UNIX. They could also sue anybody that was selling copies or licenses of UNIX without their say so.

I don't know how an attorney, especially an IP attorney, wouldn't know that you can't buy a copyright. It just seems like one of those things that you should know before you set forth to buy something. Worse still for SCO was that it was explicitly stated in the terms of the contract that the neither the copyright nor the patents were included with the exclusive trademark and licensing rights.

(-1, Wrong)

Except that he is wrong about what SCO purchased. What SCO purchased was the exclusive right to license and rent UNIX, as well as decide what OSes can and cannot be referred to as UNIX.

No, they didn't get that -- The Open Group held (and holds) the UNIX trademark, and they decide what is and isn't a UNIX. And you're quite wrong in stating that a copyright can't be purchased -- they can indeed be transferred, but that transfer needs to be explicit, and the APA didn't qualify.
(IANAL)

Re:

Yes, you're correct. Copyrights can be sold [artquest.org.uk] or transferred [about.com], as we should know [fsf.org].

Re:Where is Darl's big mouth now?

Certainly, bringing out that quote would seem only to support Darl. The big problem is that Darl kept talking, about "wholesale theft" and "millions of lines of code", and that as a successor-in-interest to apparently ALL things AT&T, how they'd be going after C++ next -- no kidding, he actually said so. That's the kind of hubris that has us all rubbing his comeuppance in his face.

Basically, he kept lying and his lies got more and more grandiose. Timed in fact quite well to his very sizeable scheduled sales of SCO stock. And it's not just the "nerd rage" afflicted making the implicit claim here -- Redhat's complaint (which hasn't even been heard yet; they're literally lining up to take a chunk out of SCO) actually used the words "pump and dump scheme".

Re:Where is Darl's big mouth now?

"Tell me, when RMS does what he believes is right in the face of opposition, what is he?"

Usually he's right.

See the difference?

Re:

I guess i stand corrected - his big mouth is still running at any and every oppertunity.

Funny though that he is taking some kind of high ground. still even though it's been proven in court that nothing belonging to SCO has been infringed on.

i guess when

which bankruptcy?

Excuse me if I haven't RTFA assiduously, but I see that SCO market value is now at $0.17 or so [yahoo.com]. Last time I checked, it had dropped $1.50 to less than $0.50 because SCO had lost a significant something at the law court. Is there a timeline somewhere? I wan

Re:

OK, answering to myself, All Hail Wikipedia! I now realize that SCO filed for bankruptcy [wikipedia.org] in the same day their stock value dropped from $0.60 tp $0.17.

The title is misleading

SCO collects fees for Novell. There is no disagreement about that. What Novell is asking for is that those fees be paid through to Novell. This has nothing to do with the major claim, tens of millions, about the Microsoft and Sun licenses. This is just about the routine license fees that continue to roll in.

AllParadox described it best. He likened SCO to a store clerk. The money the clerk collects belongs to the store owner. The clerk has no claim to it at all. If the clerk goes bankrupt, the trustee can't claim that it is part of the bankruptcy estate.

The reason that SCO jumped (or tried to jump, it hasn't been granted yet.) into chapter 11 was that the Utah court was about to apportion the amount of money it had to pay Novell for the Microsoft and Sun licenses. Because of that, Novell has warned that it is going to file something claiming that SCO acted in bad faith. My WAG is that the bankruptcy judge will allow the Utah case to go forward so as to determine the amount of money SCO owes Novell. Since SCO has little chance of being a successful business, I am also guessing that they will be put in chapter 7. In other words, they won't be re-organizing, they will be liquidating.

Novell to SCO: Will it blend?

N/T

Affiliation with Microsft brings doom

Okay, perhaps that's not a fair generalization, but after reading story after story about people who do business with Microsoft and later getting shafted.

It's generally accepted that Microsoft put SCO on their path. And no sooner does it become generally

Development of MS-Novell relationship

Emporer Ballmertine to Novell: "Good! Use your aggressive feelings, boy! Let the hate flow through you"

Negative value reorganization?

I'm having a bit of trouble understanding this scenario. SCO's total market cap is now under $4 million. If that roughly represents the total value of the company, then where are they supposed to get the money to pay Novell? My understanding is that they owe Novell quite a bit more than that.

Anyway, the good part of this fiasco seems to be that it shows that IP blackmail is a lot riskier SCO thought it would be. I'm expecting IBM to pile on soon, just to make sure that SCO goes away and stops bothering them. Either that, or the guy with the wooden stake.

Re:Negative value reorganization?

SCO was expendable. Corporations are not people, and may be thrown away where expedient.
The people who expended SCO will remain wealthy.

Re:

I've already expressed my meta-moderation opinion about the anonymous and elitist moderation system: It sucks.

Do you really read at -1, then? I've tried. I tried the first couple of times that I moderated, to make sure I wasn't missing any hidden gems

Novell to become the new SCO?

Am I the only one a bit concerned about Novel taking on the self-assumed role of being the new "corporate stewards" of Linux? Especially since the slashdot community seems to accept them and IBM in that role...

Yes, you are.

Now, go away or I will taunt you a second time.

Ain't no SysV code in Linux

You must have missed the very public SCO v. IBM lawsuit. This is where SCO demanded (and got) all the source code for all the versions of IBM's AIX and Dynix operating systems in their search for a link connecting the ancient SysV code with code in Linux. They came up with zilch, nada, zero.

SCO repeatedly claimed that there were millions of infringing lines in Linux. But unfortunately for SCO in addition to the delusion that they owned the SysV copyrights, they also suffered from the delusion that they somehow had control over IBM's own home-grown code.

Linux is clean regardless of who owns the SysV copyrights.

Re:Novell to become the new SCO?

i don't think your looking at this from the right angle.
just for a second, lets assume that novell isn't a linux distro company, and that they don't want to make it up to the linux community out there for the microsoft deal, and lets forget that sco is the personification of evil.
they have a company that they've sued and won.
whatever the reasons:

1) sco owes novell money.
2) sco is going broke.
3) novel wants their money before sco goes down.

id imagine the phb's in novell are looking at the situation exactly this way.
its cool that they come out to be the linux advocates, and taking down the bad guy - free good publicity and so on.
but that's just a side-effect, they would go after sco regardless of the circumstances.

aside from that - i wouldnt consider novell to be the new 'stewards' of linux.
i don't have all the data - so this is just my impression, but....

we have all seen IBM fight the good fight with sco for more than just a few months... i mean - its been years, and lets face it - it would have been cheaper for them to just buy sco, instead of fighting them.
novell noticed whats going on with this linux thing, and they manage to make a profit while creating contributing back to the linux community.
but IBM is investing a lot more then their getting back (i may be wrong here, as we(i) don't know whats in their agenda for the years to come - this could be one of those investments where you loose money for 10 years, and start making money in 20 - IBM is a company that can afford a business plan like this), and novell is just doing business like everyone else (it may sound cold, but there is no shame here - we all benefit from what they do, so cudos to them).

Comical Ali lives?

if you look inside that appeals process and you take a microscope and look at the record of Kimball's summary judgment rulings that have gone to appeals, he gets overturned the vast majority of the time. It's nearly two-thirds of the time.

Um, Darl, this isn't the sort of thing you say about someone holding the contents of your codpiece in his hands. He's already ruled that your company, of which you are CEO, with responsibility for the company's actions, has committed conversion and you may just have annoyed him a touch with that quote. I really do hope the Honourable Dale A. Kimball sees what you said. The result could be rather interesting.

Not to mention the ratio of appealed to non-appealed cases might have some bearing on the soundness of his judgments. Sometimes it helps to know just how many of these summary judgments have people "banged to rights" before we start looking at the appeal successes.

But best of British to you, old son. You really are quite, quite funny. Erm, is that a tank in the background?

Re:

Damn it! Quote [computerworld.com] your sources, man! (page 2) We really need an "edit this half-arsed post" button.

SCO got that wrong, too

Somebody went through Judge Kimball's entire summary judgement appeal record and posted it. [investorvillage.com] No, he doesn't get reversed two-thirds of the time.

Microsoft

At Microsoft, they're really good though. You gotta give them that. They're really, REALLY good.

Play everyone on the market like pawns. I wish I met the well spoken, kind gentlemen show explained both the people in SCO and Novell, why they had to do what d

They can say anything they want

Novell can ask for anything they want, what the judge says is what counts.

SCO CANNOT win in the long term, but boy are they good at playing the legal system. If this Bankrupcy judge remains as nieve as he appears... the money will be gone by the time he wakes up. We will see.

How SCO's law firm (BSF) avoids being on the hook for millions, and how the SCO executive tries to stay out of jail will be as interesting as this whole saga... Groklaw has many years of material left just with SCO alone.

Corporate veil about to get shredded

Anyone else think that Novell and IBM are going to get through the corporate veil and start going after the corporate officers personally?

Re:

I do. There is the issue of conversion - stealing someone else's money and using it as your own. The way SCO has spent money on bonuses the day before the bankruptcy filing, the hiring of a temp CFO at $150/hr ($105 wages and $45 to the temp agency), alo

Who Will Get Unix?

One issue of the SCO/Novell suit is whether SCO owns the Unix System V code (by owning its copyrights), or whether Novell still does instead. Novell didn't seem to be doing any business depending on owning the Unix copyright, so even if this suit is settled (probably by the judge, in a binding decision) specifying that Unix belongs to Novell either because SCO never owned it, or that SCO did own it but must surrendered it to Novell as compensation for damages, Novell will probably own it. But what will they do with it?

Will they sell it "again", this time retaining their rights to use it that will prevent any attempt at the kind of extortion SCO attempted (whether or not it was legitimately based)? Will they keep it and use it themselves, other than to protect their right to include it in Linux? Will they kill it so it doesn't cause any problems in the new market Novell is in (maybe because Microsoft wants it out of the way once and for all)? Or will they perhaps kill just the copyright, and put it all into the public domain, or under GPL - perhaps just including it in a revised Linux kernel?

Will Novell perhaps release a Linux compatible layer made of Unix that interoperates with only the Novell distro, and with Vista?

The SCO/Novell suit could turn out to be just a preliminary battle. The next chapter of Unix's history could turn out to be the really interesting one. Which, with that kind of relativity, could be extremely interesting.

Re:

Judge Kimball already ruled that Copyrights did not transfer with the Asset Purchase Agreement, and so SCO does not own the Unix System V Copyrights. He also found that the Microsoft and Sun licenses were in part SysV licenses, so some part of the revenue

Will someone explain???

Will someone who understands bankruptcies explain to me how SCO's bankruptcy can continue when the financials they submitted are so clearly wrong?

A court on the East Coast has declared that SCO has been holding assets belonging to Novell.

SCO apparently is including those assets in its balance sheet, and only referring to the matter in the way an accountant would treat a minor unknown, like "Estimated Office Inventory Shrinkage, Current Quarter". However the theft involved is not minor; it probably exceeds the sum of SCO's reported profits over the last few years.

How can the Utah bankruptcy court accept the financial statements that SCO has submitted as valid? How can SCO get protected status if its application failed to meet the requirements?

This case strikes me as being like a pawn shop that has declared bankruptcy after being found guilty of fencing stolen property. The bankruptcy cannot go forward until an investigation to determine how much of its current inventory is stolen property is completed.

It seems to me that this is one of those instances where the bankruptcy cannot proceed until the amount of the theft has been determined. I would think that SCO's bankruptcy request should be denied or nullified, and SCO should be told it cannot submit one until it can accurately produce the required financial statements.

Is it any wonder that most of SCO's accounting staff have left? Being associated with the financials SCO provided the bankruptcy court would be a career stopper for an accountant.

So, does this mean Novell owns them? No.

Not yet. The Sun and Microsoft "license" royalties are worth $25 million on face value and $37 million with interest. But first the trial in Utah must be unstayed so Judge Kimball can decide exactly how much of that money is actually Novell's. Before the bankruptcy, if that was a substantial sum then it would have been game over for SCO. But now with the bankruptcy, after Judge Kimball decides the amount in Utah, the action swings back to Delaware where it will be up to Judge Gross to decide whether to give Novell the constructive trust or not.

Novell has already asked Judge Gross for a constructive trust but he refused (which was very reasonable IMO) saying that there might be other creditors on the same footing as Novell that he has not heard from yet. In other words, if it is discovered that SCO stole money from other people in addition to Novell then the victims of those thefts get to join Novell at the front of the line of creditors.

The first thing that has to happen though is the November 6th hearing in Delaware where Judge Gross gets to decide whether to lift the stay or not.

Re:So, does this mean Novell owns them?

But this isn't about Novell being a creditor; this is about SCO having in their posession $ that belongs to Novell.

Not exactly

Caldera was formed by Ray Norda, founder and one-time CEO of Novell, and for many years, the public face of Novell, just as Billy is/was the public face of Microsoft and Larry Ellison is the public face of Oracle. However, Caldera was never directly conne