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Novell Claims Ownership of UNIX System V
Bruce Perens writes:
"We knew that SCO's attack on Linux was a lie. But we never dreamed of the big lie behind it.
"This morning, Novell announced some of the terms of the company's 1995 agreement to sell its Unix business to SCO. The shocking news is that Novell did not sell the Unix intellectual property to SCO. Instead, they sold SCO a license to develop, sell, and sub-license Unix. The title to Unix copyrights and patents remains with Novell. To back up this assertion, Novell refers to public records at the Library of Congress Copyright Office and the U.S. Patent Office.
"In their announcement, Novell refers to recent letters from SCO asking Novell to assign the Unix copyrights to SCO. So, apparently SCO's management team knew that they did not own Unix while pursuing their sham campaign against Linux.
"Along with this revelation, Novell is reiterating its support of the Linux and Open Source developer community, and its status as a partner in that community. Novell rejects SCO's accusations of plagiarism. Novell management says they do not intend to stand in the way of the development of the Linux kernel, its companion GNU system, and other Free Software.
"It would be an understatement to say that this leaves SCO in a bad position. The company has loudly and repeatedly asserted that they were the owner of the Unix intellectual property, all of the way back to AT&T's original development of the system 30 years ago. They've lied to their stockholders, their customers and partners, the 1500 companies that they threatened, the press, and the public. Their untruthful campaign caused the loss of sales and jobs, and damaged Linux companies and developers in a myriad of ways. And now, SCO will be the lawsuit target. SCO's quarterly earnings conference call is this morning, at 9 AM MST (11 AM EST, 8 AM PST). Call 800-406-5356, toll-free, to participate. You might even get to ask a question. It should be fun to watch them try to weasel out of this one.
"Microsoft executives also have egg on their faces. The company self-servingly rushed to buy an SCO license one business day after the threat letter, bringing a senior attorney to the office on a Sunday to tell the press how much Microsoft values intellectual property. Microsoft's management could have taken the time to analyze SCO's claims, if the company had wanted this license for practical and technical reasons. Their decision to buy when they did must have been motivated by a desire to add to SCO's fear campaign. Of course they'll grab any opportunity to spread fear about Linux, but this time Microsoft bought a pig in a poke.
"SCO management, if they insist on standing in the way of a train, could still claim that software they developed in the years since 1995 is being infringed by the Open Source developers. That claim, always a dubious one, will be difficult to take seriously now that their prevarication throughout this campaign has come to light. SCO would be well advised to drop their suit against IBM in exchange for IBM's agreement not to counter-sue. But IBM might not feel that charitable toward SCO.
"In contrast to SCO, Novell's made a friend among the Free Software developers. We're always happy to see people using our software. But a real partnership between an IT vendor and our community is an equal partnership, with the company donating services and new software in exchange for the value it receives. Novell has already placed important software under Open Source licenses. Today, the company has done us a tremendous service, by stomping upon an obnoxious parasite."
Here is Novell's informative press release on the matter. A juicy excerpt:
"SCO continues to say that it owns the UNIX System V patents, yet it must know that it does not. A simple review of U.S. Patent Office records reveals that Novell owns those patents.
"Importantly, and contrary to SCO's assertions, SCO is not the owner of the UNIX copyrights. Not only would a quick check of U.S. Copyright Office records reveal this fact, but a review of the asset transfer agreement between Novell and SCO confirms it."
Of course, this doesn't address the "source code theft" issues, but hopefully this will shut SCO up about the UNIX IP issues.
the no
Business Week has interviewed the CEO of SCO Darl McBride here. McBride gives some tips as to where IBM may have used their code. Specifically:
" In the last 18 months, we found that IBM had donated some very high-end enterprise-computing technologies into open-source. Some of it looked like it was our intellectual property and subject to our licensing agreements with IBM. Their actions were in direct violation of our agreements with them that they would not share this information, let alone donate it into open-source. We have examples of code being lifted verbatim.
And IBM took the same team that had been working on a Unix code project with us and moved them over to work on Linux code. If you look at the code we believe has been copied in, it's not just a line or two, it's an entire section -- and in some cases, an entire program. "
mp3's are only for those with bad memories
That was quick:
The following statement is being issued by SCO (Nasdaq: SCOX - News):
SCO owns the contract rights to the UNIX® operating system. SCO has the contractual right to prevent improper donations of UNIX code, methods or concepts into Linux by any UNIX vendor.
Copyrights and patents are protection against strangers. Contracts are what you use against parties you have relationships with. From a legal standpoint, contracts end up being far stronger than anything you could do with copyrights.
SCO's lawsuit against IBM does not involve patents or copyrights. SCO's complaint specifically alleges breach of contract, and SCO intends to protect and enforce all of the contracts that the company has with more than 6,000 licensees.
We formed SCOsource in January 2003 to enforce our UNIX rights and we intend to aggressively continue in this successful path of operation.
800-946-0719 for the Conference Call
"Last one in is a rotten goblin!" - Kepp
Bruce
Bruce Perens.
Some stupid-ass language selector JSP is stalled (who uses JSP to put up a press release?!) so here's the text:
Novell Challenges SCO Position, Reiterates Support for Linux
PROVO, Utah -- May 28, 2003 -- Defending its interests in developing services to operate on the Linux platform, Novell today issued a dual challenge to The SCO Group over its recent statements regarding its UNIX ownership and potential intellectual property rights claims over Linux.
First, Novell challenged SCO's assertion that it owns the copyrights and patents to UNIX System V, pointing out that the asset purchase agreement entered into between Novell and SCO in 1995 did not transfer these rights to SCO. Second, Novell sought from SCO facts to back up its assertion that certain UNIX System V code has been copied into Linux. Novell communicated these concerns to SCO via a letter (text below) from Novell® Chairman and CEO Jack Messman in response to SCO making these claims.
"To Novell's knowledge, the 1995 agreement governing SCO's purchase of UNIX from Novell does not convey to SCO the associated copyrights," Messman said in the letter. "We believe it unlikely that SCO can demonstrate that it has any ownership interest whatsoever in those copyrights. Apparently you share this view, since over the last few months you have repeatedly asked Novell to transfer the copyrights to SCO, requests that Novell has rejected."
"SCO claims it has specific evidence supporting its allegations against the Linux community," Messman added. "It is time to substantiate that claim, or recant the sweeping and unsupported allegation made in your letter. Absent such action, it will be apparent to all that SCO's true intent is to sow fear, uncertainty, and doubt about Linux in order to extort payments from Linux distributors and users."
"Novell has answered the call of the open source community," said Bruce Perens, a leading proponent of open source. "We admire what they are doing. Based on recent announcements to support Linux with NetWare services and now this revelation...Novell has just won the hearts and minds of developers and corporations alike."
Text of the letter from Novell to SCO:
Mr. Darl McBride
President and CEO
The SCO Group
Re: SCO's "Letter to Linux Customers"
Dear Darl:
As you know, Novell recently announced some important Linux initiatives. These include an upcoming NetWare version based on the Linux kernel, as well as collaboration and resource management solutions for Linux.
Put simply, Novell is an ardent supporter of Linux and the open source development community. This support will increase over time.
It was in this context that we recently received your "Letter to Linux Customers." Many Novell business partners and customers apparently received the same letter. Your letter compels a response from Novell.
As we understand the letter, SCO alleges that unnamed entities incorporated SCO's intellectual property into Linux without its authorization. You apparently base this allegation on a belief that these unnamed entities copied some UNIX System V code into Linux. Beyond this limited understanding, we have been unable to glean any further information about your allegation because of your letter's vagueness.
In particular, the letter leaves certain critical questions unanswered. What specific code was copied from UNIX System V? Where can we find this code in Linux? Who copied this code? Why does this alleged copying infringe SCO's intellectual property? By failing to address these important questions, SCO has failed to put us on meaningful notice of any allegedly infringing Linux code, and thus has withheld from us the ability - and removed any corresponding obligation - to address your allegation.
As best we can determine, the vagueness about your allegation is intentional. In response to industry demands that you be more specific, you attempt to justify your vagueness by stating, "That's like saying, 'show us the
Bruce
Bruce Perens.
Heh, I submitted this seemingly seconds before it was posted by Michael.
The press release link at Novell in the story appears to have been replaced with a blank page, at least for now. This story at the Inquirer includes a copy of the letter that Novell's CEO sent to SCO's CEO Darl McBride. Good stuff.
Down 4% since the market opened this morning, half of that in the last 20 minutes.
NASDAQ: SCOX
What they're saying is that (supposedly) they own the rights to the contract IBM signed giving it the right to incorporate the SysV code into AIX. Thus, they assume the contractual relationship with IBM, and even if they don't own copyrights/patents over the code they may still enforce the contract terms. So, if IBM did copy SysV code into Linux (still doubtful), SCO would still have a case against them for violation of the contract.
The claim that Linux was ripping off SysV code *before* IBM started doing open-source development is now much shakier, because even if SCO is right about this, they have no legal rights to pursue it- as far as we know, they have no contractual relationship with any of the other Linux companies. Novell might, but they've shown where they stand on the issue. Therefore, SCO's letter to the 1500 companies could get them in huge trouble if they turned out to be lying about the code ownership, and would be construed by the courts as an attempt to extort licensing fees. (We all know this, but what matters is making a judge understand.)
I called in and was given a new phone number.
800-946-0719
they then ask for a code after a bit of a wait and will not connect without it.
Code is 728441
Enjoy the call!
That's why Novell waited til now. SCO licensed IP it didn't own to MS which thereby tacitly acknowledged it neede to do so to not violate that IP. Novell owns the IP that MS says it needs and can now demand that MS pony up to Novell and pay for the IP they say they they are using. Novell's next letter:
Dear Bill,
You owe us a butload of money. Pay up or else.
Very truly yours,
Novell
I called the number Bruce gave above and was told to call an alternate number. The alt # is 1-800-946-0719
m.kelley
life is like a freeway, if you don't look you could miss it.
Really bad html in my prev. post and a wrong link to boot. So here is the right one
You probably can support Novell by joining Novell Forge and helping write some opensource software.
Thanks Novell. First for UDDI and now for this.just don't change your mind.
Also this development begs the question "What exactly did Microsoft buy from SCO?"
.ACMD setaloiv siht gnidaeR
Wait a minute ....
The SCO claim is that:
" In the last 18 months, we found that IBM had donated some very high-end enterprise-computing technologies into open-source. Some of it looked like it was our intellectual property and subject to our licensing agreements with IBM. Their actions were in direct violation of our agreements with them that they would not share this information, let alone donate it into open-source. We have examples of code being lifted verbatim.
And IBM took the same team that had been working on a Unix code project with us and moved them over to work on Linux code. If you look at the code we believe has been copied in, it's not just a line or two, it's an entire section -- and in some cases, an entire program. "
They don't actually say they own the code (in this excerpt), but rather, that they have licensed it to IBM. As I'm sure you know, there are often agreements made that allow corporations to sublicense works; although Novell owns the code itself, if they granted SCO the right to license it (as they apparently have), and SCO licensed it to IBM (as they apparently have), IBM is still responsible for using it legally.
Mooniacs for iOS and Android
From the press release:
You may also join the call in listen only mode via web cast at http://ir.sco.com/conference.cfm or www.companyboardroom.com
These sites will host an archive of the call for a minimum of 30-days.
M$ bought the rights to use UNIX IP from SCO which is owned (the IP not SCO) by Novell.
1f u c4n r34d th1s u r34lly n33d t0 g37 l41d
Instead of /.'ing the phone lines, try the live Web stream -- it can probably withstand a few more hits:
http://biz.yahoo.com/cc/0/30510.html
We recently had heard in the office over one of the Yellow Machine that's made by Anthology Solutions.
Press release from SCO this morning:
"SCO's lawsuit against IBM does not involve patents or copyrights."
So what the hell does it involve?
Where's the talk of IP infringement now?
It seems SCO's lawsuit and SCO itself are finished.
Looks like it's now here. I guess they're moving the press releases around. Well you can run SCO, but you can't hide!
You are not alone. This is not normal. None of this is normal.
In addition to the conference call number, you can listen to the SCO conference call online.
They're Investor Relations Page says, you can listen here.
Here's a blurb from their page;
You may also join via listen-only web cast by clicking on the url located at http://ir.sco.com/conference.cfm or www.companyboardroom.com.
I know when IBM was pursuing propietary claims against other companies, it had to do more than prove that it (IBM) owned the information, IBM had to prove that it actively and dilligently protected that information both internally and externally. With the lack of and casualness of the current protections in place (when was the last time SCO audited IBM for compliance in proctecting Unix propietary information?) SCO has a very weak case.
I'm listening to the conference call right now, and they just claimed that 1/3 of the total revenue for the next quarter would come from SCOsource (IE Suing people). Great.
__________
Love conquers all... except CANCER
Check out the SCOsource website
The page includes a FAQ and quotes from Stallman and Perens that "support" SCO's position.
McBride just claimed in the conference call that SCO "owns" the Unix asset.
61% of company revenue from Unix
8% from SCOX Unix rights
(That's a big piece of pie they are about to lose.)
Now discussing "You are a bad user letter"
SCOX is #3 mover on NASDAC thank to that letter.
Still claiming to own Unix
Claiming to own licensing rights
discussing how the shakdown has generated some good bucks
I am listening to the call. They do mention themselves as Unix IP owners many times.
They apparently had a source license deal with Microsoft.
About the current situation, he says check the website.They are going to terminate the license to IBM in 100 days.They blame code violations
They seem totally unapologetic about mailing fortune 500 companies about IP violations.
.ACMD setaloiv siht gnidaeR
I'm listening to the conference call right now - the CEO just said there are 244 people listening in, up from 7 two quarters ago. I wonder why that is? ;-)
I had no trouble getting in, by identifying myself as an individual investor.
He claims "not just a line or two of code problems [in Linux], but significant code problems."
"Millions of lines of code showing up without anyone warrantying [sic] where the lines of code came from"
No mention of Novell yet.
A customer service representative will be with me shortly.
They just said that there were 244 people on the conference call vs 17 people last quarter (or was it two quarters ago? -- either way there's a lot more).
:) This ought to be fun. I'll kharma whore with another post on that as it comes...
They are talking about the MS SCO licensing deal. Not much info.
They're talking about the IBM lawsuit.. just that they sued them, didn't specify the amount. Said that in June they'd revoke the AIX UNIX license.
Talking about the Linux letter.. that they sent to everyong. Said they found code violations -- not saying what code. Said 3 teams came back with "significant code problems". Said they were legally advised to send letters to enterprise users of Linux to advise misappropriation of code.
Regarding Linux: "Millions of lines of code without knowing where they came from" -- almost a quote. Very close. Grrr.. pissing me off.
Q&A session coming soon...
As a copyright/patent OWNER, Novell legally could sell another company or companies the right (exclusive or non-exclusive) to reproduce and resell their IP, alter it, and even license it further down the line (taking on the support and maintenance obligations for anyone they sold it to, of course). Apparently they sold such rights to SCO, but retained their position as the owners of the copyright.
Sperry (the company that bough Eckert and Mauchly's company...
Actually, it was "Remington Rand" which bought out Eckert and Mauchly. The "Sperry Rand" merger happened later.
No one had contested that Eckert and Mauchly had designed the first electronic computer.
Honeywell claimed that the Univac patent was invalid because the design was derived from the work of Atanasoff and Berry.
A: IBM still in discussions...Novell...the 1500 letters response has been VERY SIGNIFICANT...how do I find out if Linux is illegal? First, go get your own opinion of counsel. Second, we've invited people with licenses with us to come in, under NDA, and we'll show the details. Novell didn't show for their meeting at 11 AM yesterday.
Only way to get the details is under NDA.
Q: How long will SCOSource be a revenue stream?
A: started last quarter...only two contracts [MS and who?]. Opportunity is significant.
Pipeline quantification? - broad; roughly a third of revenue from SCOSource.
I'm in the conference call at the moment. In the Q&A session, somebody asked this question at point blank range:
Q: When are you going to give out specifics grievances regarding the tainted code in the IBM code?
The answer was, essentially, "We'll tell you if you sign an NDA".
Another interesting point (and I don't know if this info was out there before this) is that unless IBM repents within 100 days of the filing of the initial lawsuit (on March 7, I believe), SCO is going to yank IBM's AIX license.
Novell pretty clearly states that they were replying to a threatening memo from SCO, which SCO sent to many corporations a week or so ago. So there wasn't really any big delay.
Waiting on the Q&A session...
/.'er) -- when are the violations going to be made public?
First question(sounds like a
Only under NDA because of ongoing litigation.
What about the Novell announcement this morning?
Novell called last week re: the letter. Time set up yesterday morning at 11am. They didn't show up for the meeting. Later sent the letter -- saying SCO should publish the offenses.
"Is my linux illegal?"
SCO says people should talk to their own lawyers.
Come June 13 if no resolution with IBM -- revoke AIX license.
Details are not being disclosed. Not saying they can't sell AIX -- no real answer.
Blah blah blah about uninteresting stuff.. web services strategy and stuff.. stuff about acquisitions. Blah blah..
They just said they used to be moving people from UNIX to Linux, but when they did that, they lost a lot of money, and they basically said the customer got the same thing in terms of services. So now they're switching them back for a lot more money. Wow. That's ballsy.
Haha. sorry. Little stuff I find funny.
They say they're sort of looking at buying companies in the 4-5 million dollar (up to maybe 10 million dollars) range. Apparently their stock is doing pretty well.
How much will it cost to go after infringers? Is that being budgeted for?
structure with legal council for staying power -- pursuing and defending claims. First quarter of activitiies -- came in below budgeted amount. Set up for the long haul. Feel good about the legal structure.
Is that legal structure related to contingency?
Yes
Does that include counter suits?
Strucutred so that depending on how those come int hat they may be included in it.
I have no idea what that means.
Novell said SCO execs had asked for UNIX copyrights. It was denied. Why was this denied?
Stuff with IBM isn't related to copyright or patent. Focused on contracts. "By an order of magnitude" more powerful than copyright or patent. Language in contract between novell and SCo was confusing -- as they looked at it and said "this doesn't make sense".. SCO thinks it's confusing -- they call 'em up cuz SCO knows 'em. "If SCO wants it, then we want it too." As SCO brings in attorneys, they do a review on it and read the contract in its entireity -- SCO says they own copyrights -- that they can enforce that and the patents. Talked to all parties in agreement -- two people in NOVELL, two in SCO -- CEOs and legals of each side. Says intent was everything was transferred to SCO. Maybe some little things that are common.. Feel confident that they have the copyright and patent rights.
Suspension of linux sales -- given small amoutn of money from linux sales -- do you forsee SCO returning to selling Linux?
We would only return to Linux once the issues were resolved with Linux and "the community". SCO seems to be getting further away from that path (of selling linux). Claims are very strong and valid and customers are saying "time out here" begfore we do this big linux implementation, we nee to understand what's goign on. Linux leadership -- we like a lot of stuff about open source.. blah blha -- our intellectual property was being abused. Having more problems with that. Fruther from going back to Linux than closer.
What woudl you recommend for previous caldera users looking for an upgrade path? What recomendations?
Linux is "UNIX on Intel" UnixWare, and openserver. UnixWare can go anywhere linux can go. Lost ground while chasing the linux dream?
I'm on now - and it has started.
.net.
8.3 million in revenue from SCO Source licencing.
6000 licences.
They intend to increase these licences as they "agressively protect our intellectual property rights"
1/3rd of their projected earnings is from licencing, the rest is from OS products.
Lots of rah-rah "our best quarter ever" "we have eliminated all long-term debt"
The core business is still selling SCO UNIX
(which as an aside, means that you really cannot afford a wave of consumer hostility, can you?)
Looking to provide "subscription-based" services.
They have cash in the bank.
Their prime focus is defending themselves against Linux.
A nod towards the Novell thing - "SCO owns the UNIX contract rights" not the UNIX trademarks or IP.
A list of customers is presented... British Army just bought an asset/lifecycle management system for helicopters based on SCO UNIX
"SCO Source" is their new shakedown unit. 2 big licencees - one is secret, the other is Microsoft. Microsoft bought a licence for "Microsoft services for UNIX" putting UNIX source into Windows (?)
IBM is NOT the secret licencee.
They claim 3 code teams found violations where their code was in Linux, independantly.
No mention of what code, where.
Ahhhh... something makes sense now. Their Linux sales were tanking hard - they were making more money off SCO UNIX. So they're out to go toe-to-toe with Linux (a big part of which is anti-Linux FUD)
Q&A now starting:
First question mentions Novell release and asks for explicit listing with the code violations. They claim IBM has them (?)
Claim Novell blew them off; that there was a meeting yesterday that Novell skipped.
They refuse to publish the violations publically.
Next question is about how long the SCO Source revenue stream is likely to be. So far, they claim two contracts. No way to quantify how many contracts are in the pipeline.
What is happening Jun 14th re IBM/AIX? They will revoke the AIX licence. Details will follow.
Next question is from a capital company, asking about aquisitions. They want to get into web services, interact with Java and
They claim 2.2 million SCO servers - original business plan was to migrate those to Linux, and they lost money doing that. So now they want to keep those people on SCOX (at $1500 a server)
Nothing about why those people should stay on SCO when they have Linux readily availible....
Mr Wall Street thinks SCO is going to gain some short-term cash.
They think that their stock price spike reflects market confidence in SCO vs Linux
Another venture capitalist.... wants to know if licence deals will drive SCOX product sales.
They used SCO Source to raise capital instead of going to veture capital.
Next question asks for an estimate on legal costs. So far they are below their legal budget, but they are in for the long haul and are ready for countersuits.
Next caller wants to know why SCO was asking for transfer of UNIX copyrights from Novell and why they were denied. SCO doesn't seem to know what they own. They claim they own the UNIX copyrights, based on a contract review of the Novell contracts. They feel they can go toe-to-toe with Novell and win that fight too.
Next question wants to know if SCO has abandoned Linux sales. They claim lots of people are putting Linux implementation on hold, and that Linux "leadership" is dismissive to SCO IP rights. SCO is probably done with Linux. Caldara upgrade path is SCO UNIX.
That's it.
DG
Want to learn about race cars? Read my Book
http://netscape.com.com/2102-1104-992345.html
SCO exec sells stock after price surge
By Stephen Shankland
CNET News.com
March 13, 2003, 5:05 AM PT
URL: http://zdnet.com.com/2100-1104-992394.html
SCO Group Chief Financial Officer Robert Bench sold 7,000 of his 245,000 SCO shares Monday, two business days after the Unix software company's stock price surged on news of a billion-dollar lawsuit against IBM, according to a filing with the Securities and Exchange Commission.
SCO's stock closed at $2.21 on Thursday, a few hours before the lawsuit alleging that IBM misappropriated SCO trade secrets was announced. On Friday, the stock surged 40 percent to close at $3.10, and Bench filed to sell shares Monday at $3.06. SCO's stock since then has slipped down to close at $2.40 on Tuesday. SCO formerly was named Caldera International but changed its name to reflect the fact that most of its revenue came from Unix products acquired in 2001
For years now, I've wondered just why anyone would choose to stick with SCO Unix when so many other versions existed, most of which are cheaper and/or more stable. When I heard that they were releasing their own Linux distro, I figured they had finally seen the end of the tunnel, and were migrating their apps to move into the application market... Of course, I didn't realize they were so bad off that trying to sue the next quarter's revenue was all they had left!
SCO should be given the same respect that they so clearly show the rest of the community. I hope IBM's 400-pound gorilla legal-team squashes them into jelly.
The conference call has just finished, but according to Yahoo:
After the event has finished, the audio will be available
from this page until Fri, May 28, 2004
I only caught the last few questions, but was most amused to hear them asserting that the 4? people involved in the Novell->SCO transfer believed they were transferring the copyrights, but that the document doesn't necessarily reflect that. They also made out that there was some calls made to Novell people, but that the people higher up in the tree thought 'if SCO wants it then we want it too'. It will be interesting to see what happens in the next few hours/days, but given the significant backpedalling (pulling linux from the shelves and now talking about contracts instead of copyright) I'd say they're clutching at straws.
Anyway these are merely my own opinions - go listen to it yourself if you're really interested...
Are you guys listening to the conference call? The speaker was codemning Linux for having "millions of lines of code"...
... [short answer: no]
...
....
:) ] to pursue claims and defend claims. amount we spent [on legal fees] is less than amouut we budgeted.
... a four party group, 2 SCO, 2 Novell, concluded the contract says SCO has absolute rights to push this in marketplace... [emphasized it's not about copyrights, etc...]
I got in just before the Q/A session. I took rough notes. I'm not skilled in the art of dictation, so you should assume the following is a fictional drama loosely based on reality, which happens to be extremely dificult to read. The part about Novell doing a no show at a scheduled meeting yesterday is interesting... Apologies to non-native-English speakers-- I'm too busy to clean this up.
Questions denoted "Q:", answers denoted "A:".
By the way, SCO is pronounced as one syllable, "sko", with a long "o". Hence SCO X is pronounced "sko-ex" and SCOsource "sko-source". ick...
Q: About the IBM suit: when will you put out info regarding allegations?
A: there are two parts:
1) in discussing with IBM, they've been made aware, we continue to work path with IBM...
2: novell announcment, response from 1500 letters has been significant, lots of companies asking what is going on, "am i running compromised?, is it illegal , who do i talk to?" we have people get their own legal opinions, second, we have invited people that have licenses with us, who are concerned, to come in, under nda, to be glad to go thru things we found. in novell case, they called last week about letter, we said we can sit down with them. set to meet Novell yesterday at 11AM and Novell didn't show up, then they sent out a letter saying SCO won't meet with them, and issues the press release.
Q: the info wrt allegations will not be made public?
A: correct
Q: comment on visibility of SCO source revenue stream. How long expect it to be a contribution to revenue. others?
A: started last quarter, had 8.2 million in revenue. SCOsource 1/3 of this. signed 2 contracts so far...
Q: any way to quantify?
A; range is very broad. for the coming quarter roughly 1/3 of revenue from SCOsource...
Q: will you be able to disclose other contracted party in future?
A:
Q: what happens on June 14th with IBM? About their AIX license?
A: we will revoke their AIX license if no resolution. exact details, not ruling out, can't say definitively,
Q: do ou anticipate coming to a resolution before 6/14?
A; that question is for the other folks...
Q: Nice quarter guys... can you share [question doesn't sound interestng to Linux folk, but is about busines stategy]
A: [Answer is very long-winded-- speaker is happy to answer this one]
Q: [question from same person about business particulars]
A:
Q: [ditto]
A:
Q: [question about SCO X and SCOsource contract values in relation to new products]
A: [... he incidentaly mentions SCO is debt-free and has cash]
Q: [how much money set aside in defending IP claims?]
A: we have a lot of "staying power" [
Q: is legal structure based on contingency [A: yes] and does it include countersuits? [A: yes]
Q: Novell said this morning SCO asked Novell to transfer UNIX IP...
A: We haven't mentioned "copyright" or "patents". Everything we listed is about the contracs [with IBM]... that is our focus. There was confusing language with Novell/SCO agreement... this doesn't make any sense... how do you transfer IP without the copyright?... like selling a book w/o the words... some Novell people said this makes no sense... they concluded "if SCO wants this Novell wants it too"... legal people read contract in entirety... it's clear we [SCO] own the copyrights...
Q: Suspension o
They mentioned potential $3B in revenue from SCO/X, based apparently on everyone who owns a SCO server buying an equiavelent number of SCO/X boxes at $1500
This is from SCO's original complaint off of the SCO website. It seems that they do think they own the code as they state in line item 18. If they don't actually own it they are being purposefully deceptive.
17. All commercial UNIX "flavors" in use today are based on the UNIX System V Technology ("System V Technology").
18. SCO is the present owner of all software code and licensing rights to System V Technology.
SCO revenue: $11.1 million in products, $2 million in services, $8 million from SCO Source. There were two SCO source customers. One is Microsoft, and the other is anonymous. McBride cited "contractual obligations" and refused to identify the other customer.
The product and service revenue breaks down geographically: $6.8 million in america, $4.6 million in europe, $1.7 million in asia and the pacific. So Germany is probably an important market. There were no comments or questions about the Linuxtag suit.
SCO is developing a web services framework called "SCO X" with rollout due in August. Not many people cared about SCO X.
Most of the Q&A was information that was already known to the public. McBride re-iterated that SCO will terminate IBM's AIX license on June 14 if IBM does not resolve the issue.
Of new interest: McBride said that SCO Source had revenues of $8 million last quarter and anticipated another $8 million this quarter but refused to make projections further out. He said that SCO Source is not a royalty stream. Rather, it was a way to shore up the balance sheet in a non-dilutive way. Last year SCO was thinking about issuing new stock, but now they don't have to.
McBride said that they scheduled a meeting with Novell yesterday morning at 11:00 am (no time zone specified) but that Novell "did not show up" !
The only way to see the claimed infringing code will be under NDA.
SCO is paying their lawyers at least partially on contigency (no big deal).
On the copyright/patent/trademark issue: quote from McBride: "the contracts are by an order of magnitude more powerful than copyrights or patents".
(Editorial: This fits in with SCO's response to Novell this morning. SCO's position is that they have a contract with IBM and the contract controls. Since SCO doesn't have a contract with most people, they will have a hard time going after other parties on a copyright or patent basis.)
Somebody asked if SCO would return to selling Linux. McBride said that the community had "polarized" and they were moving further away from ever selling Linux again. Then the followup question: what does McBride recommend for an upgrade path for current Caldera OpenSystems customers? Answer: "UnixWare or OpenServer".
SCO is now claiming that Novell is wrong. Check ou this article from Forbes.
0 5/ 28/rtr984048.html
http://www.forbes.com/technology/newswire/2003/
Really, it just loaded fine for me. FYI, the Novell webserver is Apache...
"I'm just here to regulate funkyness." - James Gandolfini, as Winston in The Mexican
First off, I was able to get in using the original number from Bruce. I had to give my full name, phone number, and company. For company, I said that I was a private citizen and had no problems getting in.
I came in a bit late, but I don't think I missed much, as the SCOSource bit wasn't discussed until later. Also, I got in on all of the questions. I was disappointed that Bruce Perens didn't get to ask a question.
From what they said in the beginning and from the answers to the questions (most of which were fairly typcial financial questions from financial analysts, btw) here is what I got out of it. Be advised that this is just one person's interpretation of what SCO is saying and that IANAL.
1. The suit against IBM doesn't depend upon IP ownership via copyright or patents, per se. It is a suit based on breach of contract between SCO and IBM. The original contract (license) between IBM and the then-owner of the rights included a stipulation against sharing this code or IP. Needless to say that any alleged releasing of this code under the GPL would qualify. SCO has the right to sue, because it purchased the license rights from Novell.
2. The language of the rights transfer from Novell to SCO seems to have been considered rather unclear by SCO about whether the actual IP ownership (copyright and patents) of UNIX(tm) had been transferred. After much research by SCO and it's counsel, they believe that they do, in fact, now own the copyrights and pertinent patents to UNIX(tm). Included in the research was discussions with lower-level contacts within Novell and with the principals of the earlier deal, many of whom no longer appear to be in power at Novell.
3. While it's true that the suit against IBM doesn't derive any legitiamcy from IP ownership (see 1), due to SCO's belief that it owns the IP of UNIX(tm) SCO believes that future lawsuits may be brought against anyone infringing on what SCO believes to be their IP, with or without a license agreement based on copyright or patent laws.
4. SCO now feels confident that a court proceeding to settle any dispute between SCO and Novell would be resolved in their favor.
My personal conclusions:
A. While Novell's stance certainly helps against SCO's activities (at least it buoys morale and adds a corporate voice against SCO), it is not the end of the IP issue. It seems that SCO is prepared to legally assert it's claims to the IP ownership, despite this morning's announcement by Novell.
B. Novell's announcement will marginally help against the FUD created by SCO's actions. However, I believe that only the most ardent and brave Linux supporters in corporate management will feel better enough to proceed if they were at all concerned. The rest will put off any decision to switch because there is still too much uncertainty and risk to their own stature and careers.
C. The FUD about Linux will continue until the alleged violations are made public enough to allow either a solid refutation or code replacement.
Really? 'Cause that's not what you said before, you bunch of assholes. Last month, it was patents, copyrights, AND trade secrets. Then they got outted about the patents, and the fact they don't own any (Novell and Tarantella do I believe). Then it was copyrights and trade secrets, according to Darl. Now, they drop the copyright argument, after Novell decides to shame them, and evidently are down to trade secret.
Of course, if he's punting the copyright argument, that puts linux out of damage, or should.
Naturally, they're still lying, since they don't know how to do anything else. My favorite line from their press release today:
"SCO owns the contract rights to the UNIX® operating system. SCO has the contractual right to prevent improper donations of UNIX code, methods or concepts into Linux by any UNIX vendor."
Really? They do? That little bitty circle-R there seems to imply a copyright. I wonder if the Open Group will bitchslap them the way Novell just did, since they own that trademark. Anyone can call any product Unix if Open Group says so, and SCO ain't got a thing to do with it. The only way to make the above sentence true is to substitute UNIX with OpenUnix. Now, the only thing they can hang on to is if IBM put some project Monterrey into linux. That's it, and good luck SCO.
I mean, I understand lying and all to get some cash through FUD, but they're losing their skill at it, because their latest is just bunk through and through.
-Looking for a job as a materials chemist or multivariat
They say that if you wanted someplace to look, then the filesystem support would be the place to start. They don't at all suggest that it actually happened. Suggesting that the lkml post you link makes it look like they might have stolen code from Linux is just like SCO saying that IBM has stolen code from them and then refusing to put up or shut up.
No, it isn't. The source code for the Linux kernel is available for public perusal. The source code to Unixware (or whatever SCO is calling it these days) is not. Telling someone to "show the offending code" of a proprietary product isn't reasonable, although asking them to point to the object code which was likely compiled from the stolen code (and decompiling that) isn't all that unreasonable, and would likely provide enough evidence for a subpeano compelling an examination of the code in question.
The statement may have been inaccurate, but it is certainly nowhere remotely tantamount to what SCO has been doing, by any rational measure.
That having been said, it wouldn't surprise me at all if SCO did in fact steal code from Linux, and that this entire debacle was either premeditated (with theft of Linux code a first step in this entire premeditated crime), and then fell apart when the executives at SCO who had intended to do this discovered to their horror that their predicessors had merely bought sublicensing rights and not the actual copyrights and patents, or a preemtive action to try and cover their own exceedingly dirty tracks.
Indeed, the latter is really the best possible face that can be put on SCO's actions, and is itself nevertheless quite appalling, as it entails deliberate copyright violations and fraudulant allegations being made by SCO in an effort to defraud the community and Linux vendors. No matter how one slices this, SCO and its leadership are in a whole heap of legal trouble, and if Novell's allegations prove to be true, could well be facing very serious criminal charges of fraud and SEC violations, charges that could bring with them solid prison sentences.
The Future of Human Evolution: Autonomy
SCO Statement on Novell's Recent Actions
SCO® owns the contract rights to the UNIX® operating system. SCO has the contractual right to prevent improper donations of UNIX code, methods or concepts into Linux® by any UNIX vendor.
Copyrights and patents are protection against strangers. Contracts are what you use against parties you have relationships with. From a legal standpoint, contracts end up being far stronger than anything you could do with copyrights.
SCO's lawsuit against IBM does not involve patents or copyrights. SCO's complaint specifically alleges breach of contract, and SCO intends to protect and enforce all of the contracts that the company has with more than 6,000 licensees.
We formed SCOsource in January 2003 to enforce our UNIX rights and we intend to aggressively continue in this successful path of operation.
SCO is a registered trademark of The SCO Group.
UNIX is a registered trademark of The Open Group.
Linux is a registered trademark of Linus Torvalds.
When VPNs are outlawed, only outlaws have VPNs.
Give the Sco vs IBM position paper a read (http://www.opensource.org/sco-vs-ibm.html) it's quite informative. One of the main contentions is that the functionality in Linux far exceeds any matching functionality in SCO's code. That being the case you would wonder how they were able to borrow code from SCO?
(The best explanation so far [I believe from here on SlashDot]: IBM coders used cut and paste instead.)
--- I wish I could hear the soundtrack to my life. That way I'd know when to duck.
SCOX dropped by 5% since the end of the conference call.
NOVL risen by roughly the same amount over the same period of time.
IBM holding steady.
Source: Nasdaq.com
An infinite number of monkeys will eventually come up with the complete works of
The Open Group was assigned the trademark rights to the UNIX(TM) name for purposes of standards compliance (you can't call your OS UNIX(TM) without them). What we've found out today, however, is Novell, not SCO, owns the UNIX System V code and its assocated copyrights and patents.
--Mythos
I doubt there would be grounds to sue Linus even if there was clear-cut evidence of patent infringement in the Linux kernel. Linus didn't put the supposedly offending code in there, but he's still liable? SCO seems to be really grasping at straws here; they know that the bluff has been called. I just hope they don't manage to do any more FUD-based harm to Linux before they die a merciful death.
I'm not a lawyer, so nobody use this as legal advice. If you want legal advice, go pay a lawyer.
That's it. I'm no longer part of Team Sanity.
Hate to reply to my own post but it is sinking fast....
SCOX 2:40pm 6.88 -1.83 -21.01% N/A N/A 6.87 7.00
Zoid.com
PROVO, Utah -- May 28, 2003 -- Defending its interests in developing services to operate on the Linux platform, Novell today issued a dual challenge to The SCO Group over its recent statements regarding its UNIX ownership and potential intellectual property rights claims over Linux.
First, Novell challenged SCO's assertion that it owns the copyrights and patents to UNIX System V, pointing out that the asset purchase agreement entered into between Novell and SCO in 1995 did not transfer these rights to SCO. Second, Novell sought from SCO facts to back up its assertion that certain UNIX System V code has been copied into Linux. Novell communicated these concerns to SCO via a letter (text below) from Novell® Chairman and CEO Jack Messman in response to SCO making these claims.
"To Novell's knowledge, the 1995 agreement governing SCO's purchase of UNIX from Novell does not convey to SCO the associated copyrights," Messman said in the letter. "We believe it unlikely that SCO can demonstrate that it has any ownership interest whatsoever in those copyrights. Apparently you share this view, since over the last few months you have repeatedly asked Novell to transfer the copyrights to SCO, requests that Novell has rejected."
"SCO claims it has specific evidence supporting its allegations against the Linux community," Messman added. "It is time to substantiate that claim, or recant the sweeping and unsupported allegation made in your letter. Absent such action, it will be apparent to all that SCO's true intent is to sow fear, uncertainty, and doubt about Linux in order to extort payments from Linux distributors and users."
"Novell has answered the call of the open source community," said Bruce Perens, a leading proponent of open source. "We admire what they are doing. Based on recent announcements to support Linux with NetWare services and now this revelation...Novell has just won the hearts and minds of developers and corporations alike."
Text of the letter from Novell to SCO:
Mr. Darl McBride
President and CEO
The SCO Group
Re: SCO's "Letter to Linux Customers"
Dear Darl:
As you know, Novell recently announced some important Linux initiatives. These include an upcoming NetWare version based on the Linux kernel, as well as collaboration and resource management solutions for Linux.
Put simply, Novell is an ardent supporter of Linux and the open source development community. This support will increase over time.
It was in this context that we recently received your "Letter to Linux Customers." Many Novell business partners and customers apparently received the same letter. Your letter compels a response from Novell.
As we understand the letter, SCO alleges that unnamed entities incorporated SCO's intellectual property into Linux without its authorization. You apparently base this allegation on a belief that these unnamed entities copied some UNIX System V code into Linux. Beyond this limited understanding, we have been unable to glean any further information about your allegation because of your letter's vagueness.
In particular, the letter leaves certain critical questions unanswered. What specific code was copied from UNIX System V? Where can we find this code in Linux? Who copied this code? Why does this alleged copying infringe SCO's intellectual property? By failing to address these important questions, SCO has failed to put us on meaningful notice of any allegedly infringing Linux code, and thus has withheld from us the ability - and removed any corresponding obligation - to address your allegation.
As best we can determine, the vagueness about your allegation is intentional. In
OS Software is like love: The best way to make it grow is to give it away.
According to a story on Marketwatch, SCO is intent on suing Linus Torvalds eventually. Now I know his reputation for avoiding political issues, but this one may be nipping at his rear whether he wants it or not:
McBride added that unless more companies start licensing SCO's property, he may also sue Linus Torvalds, who is credited with inventing the Linux operating system, for patent infringement.
Listen to archived audio here:
http://biz.yahoo.com/cc/0/30510.html
Very amusing listening to Darl say they can't promise not to yank IBM's right to sell AIX!
-dave
SCO has no patents, according to the US PTO site, and Caldera Systems only has one ("Method and apparatus for monitoring computer systems and alerting users of actual or potential system errors", filed on Feb. 29, 2000 and granted on March 4, 2003).
IANAL, nor am I a patent attorney, but it sure seems like SCO is blowing smoke at anyone and everyone.
The Boeing Company USA
The Federation Against Software Theft UK
The MITRE Corporation USA
The SCO Group USA ***** HERE IT IS
TimeSys Corporation USA
Toshiba Corporation Japan
Toyota InfoTechnology Center, Co., Ltd. Japan
It's under regular memberships. Use FIND next time rather than scanning it with your eyeballs. Note this is not in reference to The Santa Cruz Operation (SCOC) but rather The SCO Group.
here are novell's patents Link
Agreed. Some path to success. They took the #1 position today in the list of % price losers on the Nasdaq. Well, they're number one at something, now, but I don't think they're too happy about it.
If you really believe this then please file a complaint with the SEC yourself. They make it real easy, and you can even file directly on line: SEC complaint center. Note that the forms are directed towards investors, but the SEC will still take action if they recieve enough reports from concerned citizens.
According to their website, "SCO is the owner of the UNIX Operating System Intellectual Property that dates all the way back 1969, when the UNIX System was created at Bell Laboratories. Through a series of mergers and acquisitions, SCO has acquired ownership of the patents, copyrights and core technology associated with the UNIX System. The SCO source division will continue to offer traditional UNIX System licenses to preserve, protect and enhance shareholder value."
http://www.sco.com/scosource/
"We can't solve problems by using the same kind of thinking we used when we created them."
UNIX is a registered trademark of The Open Group
Linux is a registered trademark of Linus Torvalds.
The below quote is from this Reuters article;a nyNewsArti cle.jhtml?storyID=2839994&ric=SCOX&infotype=news&c ompname=SCO+GROUP+INC
http://www.reuters.com/financeQuoteComp
I suppose this wraps it up for the day.
The market came down with a tough verdict on SCO.
"Shares of SCO closed down $2.11, or more than 24 percent, at $6.60 on the Nasdaq. Novell gained 13 cents, or 4.3 percent, to $3.13."