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Wow, that's what you call turning the tables on SCO.

Warning: put drinks and domestic animals safely out of danger first.

This is a little OT, but SCO told the names "offending" files in a court doc at groklaw. They don't say what parts of the files are "theirs", but they've narrowed it down to about a 1/5 of the kernel. :-)

Just be careful--SCO intends to do the same thing.

Read more on their plans at these Groklaw articles:

SCO trying to spread FUD about open source software securty / Groklaw's call for help

SCO taking crap about a "conspiracy" against them

If you want to help, now might be a good time to start gathering and documenting proof about security claims so that everyone without a clue doesn't just take Microsoft's word for it.

Just be careful--SCO intends to do the same thing.

Read more on their plans at these Groklaw articles:

SCO trying to spread FUD about open source software securty / Groklaw's call for help

SCO taking crap about a "conspiracy" against them

If you want to help, now might be a good time to start gathering and documenting proof about security claims so that everyone without a clue doesn't just take Microsoft's word for it.

On slashdot??? :-)

Seriously, IBM's response today is interesting.

First, SCO complains that IBM mischaracterizes SCO's lawsuit by characterizing it as a case about the alleged misappropriation of trade secrets. (See Plaintiff's Memorandum of law in Opposition to IBM's Motion to Compel Discovery ("Opposition Br.") at 2-3.) That is so, SCO says, because SCO asserts six causes of action, only one of which is for the alleged misappropriation of trade secrets. It is true that SCO asserts five additional causes of action. But three of the five allege that IBM breached its contractual obligations to SCO by disclosing trade secrets or confidential information, and the other two, in SCO's own words, "flow from" IBM's alleged breaches of contract based upon the disclosure of SCO's trade secrets or confidential information. To the extent it matters, there is no question that the gravamen of SCO's case concerns the alleged misuse of trade secrets or confidential information.

Here's where it gets interesting. If IBM's position is upheld as to the nature of the case, then, if SCO can't show a breach of contract, SCO's case dies there. The trade secrets or confidential information don't have to take the form of source code (and IBM makes it clear that it probably isn't - because SCO's proprietary stuff is UNIX code, not Linux code - an interesting point). In other words, if SCO can't show breach of contract, everything else is off the table :-)

But look at the date of the post the article posted, Nov. 5. As compared to the dates of the "motion to compel discovery against IBM and IBM has responded", which are November 6th and November 7th.

But look at the date of the post the article posted, Nov. 5. As compared to the dates of the "motion to compel discovery against IBM and IBM has responded", which are November 6th and November 7th.

But look at the date of the post the article posted, Nov. 5. As compared to the dates of the "motion to compel discovery against IBM and IBM has responded", which are November 6th and November 7th.

So if I were to go out and purchase Windows 2000 Server I would be able to get a discount from SCO?

That's either w00t! or WTF?

But either way, the SCO bottom line can't possibly be helped by them giving people discounts for buying Windows 2000 or HP-UX or whatever.

As for FUD, I would say there is less of it overall. Less F for Linux' future, less U about whether Linux is good for my bottom line,and less D as to whether SCO is in a terminal state of delusion.

Really, this whole thing reminds me of Monty Python, where, when things have got so weird and excessive as you can believe them to get, then there is yet another twist added to take it further across the limit.

From groklaw (about half way down the page): PJ: One thing I think some have missed is that SCO decided not long ago to pay its directors and key execs in stock instead of cash, either exclusively in cash or in addition to cash. I did put that info on the blog. So at least some of the activity is probably just folks cashing in to get paid so they can pay the mortgage. Given that the amounts are relatively small, what you are pointing out is more likely to be related to paying the rent and less likely to be related to pump and dump.

It appears that "IBM's motion to compel is scheduled for oral arguments on Dec. 5." (stolen from Groklaw). Hopefully after that, things will tank and we can get back to normal.

SCO has filed a motion to compel discovery against IBM and IBM has responded...

SCO has filed a motion to compel discovery against IBM and IBM has responded...

The Grinch Who Stole Linux. Well done.

Then Mr Boies comes out looking as good as he did when Al Gore lost in Florida, but a little bit poorer.

This probably explains why he's allocated his most retarded and junior staff to work on the case.

Although the odds of winning are probably akin to playing the lottery, he's clearly only investing the lawyerly equivalent of a dollar in paying for his ticket.

> In addition, this modification may result in the payment to such law firm of up to $1,000,000 and
> the issuance of up to 400,000 shares of SCO's common stock.

Okay.. So, they are paying thier lawyers either 1) 20% of the settlement for what they beleive is their most valuble asset (The Unix IP), 2) 20% of the company value, *and* up to $1M + up to 400K stock shares.

Wouldn't it have been cheaper to buy a few law firms? That is a friggin ton of compensation. And for that (plus the small price of their reputations and soul) they get some really bad legal service.

With management making decisions like that it's no wonder the only asset the company really has anymore is stupid. But at least they have plenty.

Except that Novell can just tell SCO that they can't sue - I wonder why we don't hear more on this... Since it appears that SCO can't sue IBM anyway.

There's even more info over at Groklaw concerning this, BTW.

Someone over at Groklaw that they are clearly in violation of the NET (NO Electronic Theft) Act. The post is the fifth one down in the discussion. I wonder what it takes to file a such criminal complaint?

Though, I despise what SCO is doing, please, RTFDocs, before making statements like this.

Their reasoning why GPLed works should fall into public domain is not that it happens implicitly. What they say is that because GPL violated U.S.C. 17 you can not claim protection under it as a matter of equity. Look up AFFIRMATIVE DEFENSES section here

28. SCO accepted the terms of the GPL by modifying and distributing Linux products. By distributing Linux products under the GPL, SCO agreed, among other things, not to assert -- indeed, it is prohibited from asserting -- certain proprietary rights over any programs distributed by SCO under the terms of the GPL. SCO also agreed not to restrict further distribution of any programs distributed by SCO under the terms of the GPL.

The response from SCO's lawyers in their answer to IBM's counterclaim:

28. Denies the allegations of [paragraph] 28.

I agree that their claim runs counter to the tendency of the courts and politicians to increase protection of copyrights. Groklaw has an analysis of SCO's claim that GPL = Public Domain. Basically, it's a big stretch legally but pretty much every SCO claim is a long shot.

Yes, but does SCO know that? After the most recent 8k filing, SCO's lawyers are basically saying they'd rather have a guaranteed chunk of change than a percentage of the award. Lawyers aren't dumb, they make sure they get paid. Add to that, the fact that Boies wasn't a signer of the answers to ammended counter claims, it seems to me that Boies, Schiller & Flexner has pretty much decided that they can't win this one. They put in the second string lawyers (the ones with billing rates that won't exhaust the not-to-exceed amount of their new agreement), they fire all their guns at once and (a) hope for a miracle and the judge tosses the case out, or (b) justice prevails and the SCO becomes a grease spot on the information super highway. Either way, I'm getting the impression that the lawyers are trying to wrap it up quickly.

In short, they don't want to show the code this exact minute.

They bad mouth IBM some more, tell a fib or two, by my reckoning, and then sit down, saying the motion should be denied. Let's go over the document piece by piece.

"It has been said that things have both an ostensible and a real reason. Ostensibly, IBM filed its motion to Compel to force SCO to answer interrogatories and produce documents because it had failed to do so. The reality, however, is that SCO not only timely responded to IBM's discovery requests, it then engaged in weeks of lengthy conversation, correspondence, and emails to resolve and clarify discovery issues and ultimately agreed to supplement its responses. But supplemental responses were not all that IBM was seeking. If that were the case, IBM would have waited until today, when supplemental responses were promised and were in fact served. No, what IBM really desired was a forum within which it could construct its stilted and inaccurate mischaracterization of SCO's claims, behind which it could hide its own failure and refusal to provide meaningful discovery responses. As detailed below, IBM's motion is without merit and should be denied."

Here SCO tells the judge that there is no need for any Motion to Compel. They told IBM they'd give them their supplemental answers (that they should have given them from the beginning but didn't until after "weeks of lengthy conversation, correspondence, and emails" made them agree to do it) by today. We did, so why did they file a Motion to Compel? There are pretend reasons used as a cover, they say, and then the real reason. And the real reason was so IBM could have a forum to mischaracterize SCO's claims and so it could hide from their own failure to give SCO meaningful answers to *their* discovery requests. In short, the defense is, IBM hasn't answered all our questions either. Never mind that IBM sent its interrogatories to SCO weeks before SCO sent IBM its interrogatories.

This is certainly a novel way to respond to a Motion to Compel Discovery. SCO has been accused of refusing to turn over information and documents it must turn over, and their answer is, well, they didn't either. Their secondary answer is that although they had not turned the materials over by the date of the filing of the Motion, IBM should have been able to trust SCO's word. Heh heh. IBM already told the judge in its Motion to Compel that the reason they were filing was because SCO had absolutely refused to tell them that they would produce the materials requested, not that they were pokey.

So now, somebody's mistaken or lying. Either SCO told IBM it'd turn over everything IBM asked for by the 23rd, or they refused to commit themselves to doing so, which is IBM's story. So, who do you believe? I think the rest of the document makes clear that when SCO says it offered supplementals, it still didn't mean it would answer all IBM's questions or provide everything IBM asked for.

"At its core, IBM's Motion to Compel Discovery asks for answers to interrogatories that fit its own mischaracterized theories of the case, rather than answers that relate to the actual allegations made by SCO in the Complaint."

IBM is asking us things

It's time to analyze SCO's Memorandum of Law in Opposition to IBM's Motion to Compel Discovery, which we posted as text yesterday. If I had to characterize it in a brief sentence or two, the sentence would be that SCO tells the court, "How are we supposed to know what code IBM misappropriated? It's up to them to prove our case for us. It's not for us to hand over the code; it's up to them to show us every bit of code they ever donated to Linux. Then, we'll go over it and find whatever we can find. And anyway, we've given them plenty of stuff just today, so who needs a motion to compel? Let's just forget the whole thing."

In short, they don't want to show the code this exact minute.

They bad mouth IBM some more, tell a fib or two, by my reckoning, and then sit down, saying the motion should be denied. Let's go over the document piece by piece.

"It has been said that things have both an ostensible and a real reason. Ostensibly, IBM filed its motion to Compel to force SCO to answer interrogatories and produce documents because it had failed to do so. The reality, however, is that SCO not only timely responded to IBM's discovery requests, it then engaged in weeks of lengthy conversation, correspondence, and emails to resolve and clarify discovery issues and ultimately agreed to supplement its responses. But supplemental responses were not all that IBM was seeking. If that were the case, IBM would have waited until today, when supplemental responses were promised and were in fact served. No, what IBM really desired was a forum within which it could construct its stilted and inaccurate mischaracterization of SCO's claims, behind which it could hide its own failure and refusal to provide meaningful discovery responses. As detailed below, IBM's motion is without merit and should be denied."

Here SCO tells the judge that there is no need for any Motion to Compel. They told IBM they'd give them their supplemental answers (that they should have given them from the beginning but didn't until after "weeks of lengthy conversation, correspondence, and emails" made them agree to do it) by today. We did, so why did they file a Motion to Compel? There are pretend reasons used as a cover, they say, and then the real reason. And the real reason was so IBM could have a forum to mischaracterize SCO's claims and so it could hide from their own failure to give SCO meaningful answers to *their* discovery requests. In short, the defense is, IBM hasn't answered all our questions either. Never mind that IBM sent its interrogatories to SCO weeks before SCO sent IBM its interrogatories.

This is certainly a novel way to respond to a Motion to Compel Discovery. SCO has been accused of refusing to turn over information and documents it must turn over, and their answer is, well, they didn't either. Their secondary answer is that although they had not turned the materials over by the date of the filing of the Motion, IBM should have been able to trust SCO's word. Heh heh. IBM already told the judge in its Motion to Compel that the reason they were filing was because SCO had absolutely refused to tell them that they would produce the materials requested, not that they were pokey.

So now, somebody's mistaken or lying. Either SCO told IBM it'd turn over everything IBM asked for by the 23rd, or they refused to commit themselves to doing so, which is IBM's story. So, who do you believe? I think the rest of the document makes clear that when SCO says it offered supplementals, it still didn't mean it would answer all IBM's questions or provide everything IBM asked for.

"At its core, IBM's Motion to Compel Discovery asks for answers to interrogatories that fit its own mischaracterized theories of the case, rather than answers that relate to the actual allegations made by SCO in the Complaint."

IBM is asking us things that don't relate to

Yes, there's a good site collecting all the information relevant to the SCO cases: SCOvsIBM. They've got an executive summary, analysis, a time-line, and links to almost every SCO article out there. The 2 other good sources are Groklaw and SCO's page, which has the actual legal documents pertaining to the case.

'You can have great security without privacy I suppose,' says Peter Cullen, former chief privacy officer of Royal Bank of Canada and newly appointed chief privacy strategist for Microsoft, 'but you can't have great privacy without great security.'"

Maybe Microsoft owns Canada.

They could always just fax over a copy of the license.

According to their Substitute Motion for Enlargement of Time to Respond to IBM's Motion to Compel Discovery, their fax machine isn't too good.

"The drafters of the first Motion for Enlargement worked largely from faxed documents that were incomplete and did not contain the Addendum to IBM's Motion to Compel. Since the filing of the original motion, the contents of the Addendum were discovered."

So maybe they're better not risking faxing stuff.

Darl said they will get additional $8M from Microsoft this quarter as well.

Good news is that IBM claim Rise of Linux totally Unstoppable.

This was my bank until 2 hours ago when I read this on Groklaw.

I will not support any company that help those sleazeballs so I send transfered ALL my cash to another e-bank

Please do likewise and email them why. Yes I know it's a different arm of RBC but that is their problem no mine.

BayStar is real big on PIPEs .A PIPE is a private investment in public equity. In a nut shell it allows investors to quietly pump money into companies. Who is on the top 10 list of investors in PIPEs since 1995? You guessed it Microsoft.
Go here for more information.

The other AC is right. It's not a "Toxic PIPE" unless the conversion price resets when the stock price drops. Otherwise shorting the stock doesn't affect the ownership. The key to this strategy is that shorting it means that the investor ends up getting a lower conversion price and thereby gets a much bigger piece of the company.

This is just a normal PIPE (private investment in public equity).

I don't think we know that yet. The S1 hasn't been filed yet.

See the comment by be2weenthelines on the Groklaw discussion.

Quote:
3) One of the bells and whistles these may have is a variable conversion price, along with the fixed 16.93 conversion price we know of. (Aside: its typical for the fixed conversion price to be set off the trailing 5 day average - nothing unusual there.) If they do, it typically works so that as the price of SCO falls, the conversion price also falls, i.e BayStar's $50million investment converts into more than the initial (roughly) 3 million shares. e.g. if SCO's price falls from $20 to $10, BayStars conversion price falls from $16.93 to $8.46 so they can now convert into (roughly) 6 million shares. The point is to protect the value of their investment: 3 million shares at 16.93 ~= $50million. 6 million shares at 8.46 ~= $50 million. The implication for current shareholders is that as the stock price falls, the dilution increases. 3 million shares ~= 20% dilution. 6 million shares ~= 40% dilution. Often there is no limit to how low the conversion price can go and dilution can be total: BayStar may end up owning the entire company. *If* (and I emphasize if) the preferreds are structured this way, they are commonly called "Death Spirals".

Now that SCO actually has some money to throw around, this is the ideal time for all of us who support Linux for a living to file our class action suit against them for the damages their false claims have had on our ability to make a living.

After all, in this impromptu, roadside interview, Darl @ SCO basically states that they have to protect their income (6:42 into the conversation) and their employees' livelihoods. Those of us who depend on Linux for a living should protect ours too.

As an independent IT pro, I can honestly say that my company's bottom line can definitely use an injection. SCO's unchecked, continuing spreading of FUD has seriously impacted the number of companies implementing Linux (thus lowering the number of potential customers).

Let's face it, SCO's practically using the court system as its marketing department. That "courtroom marketing" just got the company a nice, fat $50M check. I don't see how they can get away with this right under the SEC's (apparently not-so-watchful) eye. It's so ridiculously obvious that they pumped up their stock with false claims and dumped it successfully for a huge profit, and now they're getting ready for a second round of pumping. I wonder how much the SCO execs will rake in this time around. (watch SCOX tomorrow)

SCO: Give me a copy of your source code, the Linux source code, and the BSD source code and I'll tell you whether or not your claims hold merit. My bet is that after I publish my results, your precious UNIX products will have nice, big GPL and/or BSD licenses on them. Either that, or your UNIX products will fit on a 1.44MB floppy after I remove all of the code you stole from the BSD project(s).

It's great to see that your Bayside stakehorse just dumped another bankroll of chips in front of you. I'll see your UnixWare and raise you one Linux kernel. Now call, fold, or get the hell out of the game. Whatever you do, make it quick before everyone notices you're dealing from the bottom of the deck.

There's a mirror of the ogg here, should the original get slashdotted -- it's 17 megs.

McBride talks about a number of issues, such as SGI, whether SCOintended to sue end users or commercial only, how and when theydiscovered the alleged "infringement", Caldera's contributions to Linux, and whether Debian is a safeversion of GNU/Linux to use because of its noncommercial nature. He also tells them that SCO isn't interested in suing individual users or even small commercial users. Its beef, he says, is with the "Unix vendor community", UNIX-licensing companies switching to Linux and donating code to Linux so they don't have to pay any more royalties to SCO for Unix code, "the vendors that are getting aneconomic incentive to reducing the amount of royalties that they payby virtue of taking our property and putting it into Linux, then turnaround and saying it's a free system." He mentions that they were talking about 64-way systems, not home users.

He also says they found "hundreds of thousands of lines of code that are infringing against our contracts." Note the plural on contracts. He claims the increase in functionality in Linux is because of "vendors" that SCO has "confidentiality agreements" with. Again, note the plural.

A lot has changed since June, but it's clear that when this began, SCO had in mind a very small pool of targets, UNIX vendors being a small group of companies. What stands out is that I think you'll see how polite the Linux group is,how friendly the conversation was even when strong points were being made by each side, McBride praising them several times and at the end thanking them for their input and calling them "awesome". How different this reality is from the ugly portrait he has tried topaint in the media of users of GNU/Linux software allegedly "attacking" SCO. And when you hear or read it, ask yourself, how accurate were news reports of this event? But judge for yourself and draw your own conclusions.

Transcriptof informal group chit-chat with Darl McBride

June20, 2003

Members of the Provo LinuxUsers Group (PLUG), along with other Linux and Unix group members andconcerned individuals in the area held a protest against SCO on June20, 2003. This protest began in front of SCO headquarters in theafternoon. The officialPLUG protest web site, with pictures and video, can be seen at http://mirror.lug-nut.com/

After protesting in frontof the SCO corporate offices (on a cul-de-sac), many in the groupmoved to a more visible location, a busy intersection nearby. Alittle while later, Darl McBride stopped by for an informal chit-chatwith the demonstrators on his way home. Here is what was said during the 23-minute conversation.

TheCast:

Darl: SCO CEO Darl McBride

P: Protester (thecollective group, with various individuals asking questions)

C: Cameraman

Pleasant Grove PoliceOfficer: Pleasant Grove Police Officer

Darl: So, how's theday going?

P: Oh, pretty well. We had more people than we expected. We talked to some of yourengineers outside, and they're really nice people.

Darl(0:11): So howdid all that go?

P: Oh, really well . . .

Darl(0:16): So youguys are just convinced that we're Satanic? Is that it?

P: No, no, no.

P: Just greedy,that's all.

P: We wouldn't usethose words. We would use different ones.

P:

McBride talks about a number of issues, such as SGI, whether SCOintended to sue end users or commercial only, how and when theydiscovered the alleged "infringement", Caldera's contributions to Linux, and whether Debian is a safeversion of GNU/Linux to use because of its noncommercial nature. He also tells them that SCO isn't interested in suing individual users or even small commercial users. Its beef, he says, is with the "Unix vendor community", UNIX-licensing companies switching to Linux and donating code to Linux so they don't have to pay any more royalties to SCO for Unix code, "the vendors that are getting aneconomic incentive to reducing the amount of royalties that they payby virtue of taking our property and putting it into Linux, then turnaround and saying it's a free system." He mentions that they were talking about 64-way systems, not home users.

He also says they found "hundreds of thousands of lines of code that are infringing against our contracts." Note the plural on contracts. He claims the increase in functionality in Linux is because of "vendors" that SCO has "confidentiality agreements" with. Again, note the plural.

A lot has changed since June, but it's clear that when this began, SCO had in mind a very small pool of targets, UNIX vendors being a small group of companies. What stands out is that I think you'll see how polite the Linux group is,how friendly the conversation was even when strong points were being made by each side, McBride praising them several times and at the end thanking them for their input and calling them "awesome". How different this reality is from the ugly portrait he has tried topaint in the media of users of GNU/Linux software allegedly "attacking" SCO. And when you hear or read it, ask yourself, how accurate were news reports of this event? But judge for yourself and draw your own conclusions.

Transcriptof informal group chit-chat with Darl McBride

June20, 2003

Members of the Provo LinuxUsers Group (PLUG), along with other Linux and Unix group members andconcerned individuals in the area held a protest against SCO on June20, 2003. This protest began in front of SCO headquarters in theafternoon. The officialPLUG protest web site, with pictures and video, can be seen at http://mirror.lug-nut.com/

After protesting in frontof the SCO corporate offices (on a cul-de-sac), many in the groupmoved to a more visible location, a busy intersection nearby. Alittle while later, Darl McBride stopped by for an informal chit-chatwith the demonstrators on his way home. Here is what was said during the 23-minute conversation.

TheCast:

Darl: SCO CEO Darl McBride

P: Protester (thecollective group, with various individuals asking questions)

C: Cameraman

Pleasant Grove PoliceOfficer: Pleasant Grove Police Officer

Darl: So, how's theday going?

P: Oh, pretty well. We had more people than we expected. We talked to some of yourengineers outside, and they're really nice people.

Darl(0:11): So howdid all that go?

P: Oh, really well . . .

Darl(0:16): So youguys are just convinced that we're Satanic? Is that it?

P: No, no, no.

P: Just greedy,that's all.

P: We wouldn't usethose words. We would use different ones.

P:

You got me working hard this afternoon, moving the whole site to Ibiblio. (The move was planned for the weekend). Say hello to groklaw.net.