Judge To SCO — Quit Whining

chiark writes, "Back in June, the magistrate judge presiding over SCO vs IBM gutted SCO's claims, as discussed on Slashdot. SCO cried 'foul,' appealed to the District Judge, and today that judge has ruled against SCO, succinctly and concisely affirming every point of the original damning judgement. Also included in this ruling is the news that the Novell vs. SCO trial will go first: 'After deciding the pending dispositive motions in this case, and after deciding the dispositive motions in Novell, which should be fully briefed in May 2007, the court will set a trial date for any remaining claims in this action.' It's notable that the judge conducted the review using a more exhaustive standard than required out of an 'abundance of caution,' and still found against SCO." As Groklaw asks and answers: "What does it mean? It means SCO is toast."

And the Downward Spiral Begins

[cacepi]

And the Downward Spiral begins; SCO stock down 10%; rated 'HOLD - Dangerous Risk/Reward Rating.' [yahoo.com]

Your goose is downright cooked, SCO.

More like Crispy Critters ...

[richg74]

"What does it mean? It means SCO is toast."

The District Judge has now affirmed the order originally given by the Magistrate Judge, which tossed out most of SCO's claims, basically for a more or less complete lack of evidence. However, IBM's counter-claims, including tortious interference, violation of NY business law, and violation of the Lanham Act are still alive and well. As PJ at Groklaw points out, [groklaw.net] IBM seems determined to present these claims in front of a jury. If they do, the likely outcome is a large, smoking crater in Lindon, Utah. As PJ puts it: "In short, IBM intends to skin SCO alive at trial."

From the judge's order:
the court finds that, even under a de novo standard of review, the Magistrate Judge's June 28, 2006 Order is correct.

The judge reviewed the material under appeal de novo, to be extra careful, even though he was not required to do so. This is consistent with a feeling I've had for some time: he's decided SCO's case is a complete crock, and is working on creating a trial record that will be bullet-proof on appeal.

Re:Groklaw rules

[Daniel_Staal]

The primary reason Novell wanted IBM to go first was probably because it meant that IBM's lawyers would have to be paid, and not Novell's.

Re:Groklaw's Being Just A Bit Immature

[richg74]

If you have followed this case on Groklaw since the early days, as I have, you'll remember that PJ has been the target of considerable mud-slinging from SCO: she was just a paid shill for IBM, that sort of thing. You may also remember that, early on, there were quite a few self-styled "analysts" (the apparently tireless, and certainly tiresome, Ms. Laura Didio comes to mind) who expressed their confidence in the validity of SCO's case. I'll give PJ a pass on the self-congratualation.

Re:And the Downward Spiral Begins

[jeschust]

Stock analysts traditionally never give "Sell" recommendations. Therefore, a rating of "Hold" is the lowest an analyst is willing to rate any given stock.

Re:Groklaw's Being Just A Bit Immature

[Scarblac]

Last week, in More IBM Filings and a Nice Memento for Us to Share [groklaw.net], PJ was also proud to note that the Letter to SCO [theinquirer.net] that Groklaw wrote back in 2003 was actually submitted as evidence by IBM now, to show that "SCO rebuffed requests by the open source community for evidence of the alleged infringement, which would have permitted a potential work-around."

And rightfully proud, of course. More power to PJ!

Re:And the Downward Spiral Begins

[cacepi]

Neither investors nor stock brokers/analysts understand technology or the law.

No, but they do know financials, and the numbers ain't good: a negative EBITDA, negative returns on investment and equity, negative cash flow and very little free cash - how are they going to pay for one trial, let alone two? - means a hell of a lot of bad writing on the wall for SCO.

I honestly don't see what SCO can do to turn things around even if it didn't have these trials over their heads. Short of another infusion of quick cash - which ain't happening now that Microsoft has moved to different fronts (Novell) - SCO is pwned.

Hard.

Re:More like Crispy Critters ...

[Todd Knarr]

Actually Magistrate Wells threw out none of SCO's claims. Every claim they made remains in the case, which is why her motion is non-dispositive. What she did was throw out the evidence SCO was trying to introduce to support their claims, on the grounds that they were ordered to produce it by a certain deadline, they had it in hand and could have easily produced it (according to their own statements), and they willfully refused to produce it. Having so failed to produce it in a timely manner, they're not allowed to use it now that it's too late for IBM to respond to it without prejudice. This leaves their claims with nothing to support them, which means they'll fall to a summary judgement motion by IBM (which is already in progress).

Re:More like Crispy Critters ...

[jfw25]

It's explained on GrokLaw more carefully, but in brief: when a trial judge has a magistrate judge handling preliminary discovery-related matters, as in this case, normally the trial judge will just review the magistrate's decisions for obvious and grotesque errors; trivial errors which don't matter much one way or another are just part of having a society run by and filled with fallible human beings rather than inerrant merciless killing machines. Certain classes of decisions by a magistrate judge (going beyond the official authority of the magistrate judge) require that the trial judge review the original motion from the start, "de novo", completely setting aside the magistrate judge's decision and reviewing it from the perspective of the judge with the proper scope of authority.

In this instance, Judge Kimball first found that the motion did not require de novo review; and then reviewed the original motion from the start anyway and found that the magistrate had nailed the correct decision exactly.

Re:More like Crispy Critters ...

[arniebuteft]

A de novo review is one made without any deference to the lower court. The reviewing court looks at all of the evidence, issues, etc., from a fresh new perspective. Doesn't mean there's any new evidence presented, just that the reviewing judge sort of mentally inserts himself into the shoes of the first (magistrate) judge, and decides all of the issues as if the magistrate judge had never been there.

Generally speaking, questions of fact are reviewed under a higher standard of deference than questions of law (usually de novo). When a judge makes a factual finding (i.e. Witness X is lying, the car was going 50 mph, etc.), that factual finding is usually not overturned on appeal unless it is "clearly erroneous".

However, if the judge simply makes a legal finding (statute XYZ applies in this case, affirmative defense ABC is not available to the defendants, etc.), those findings are reviewed de novo generally - the appellate judge takes a fresh look at the law.