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SCO's Real Motive... A Buyout?
psykocrime writes "Acccording to this article in ComputerWorld, CEO Darl McBride of SCO has finally discussed the possibility of a buyout by IBM in public. Among other things, McBride says:
"I'm not trying to screw up the Linux business," he said. "I'm trying to take care of the shareholders, employees and people who have been having their rights trampled on." and
"If there's a way of resolving this that is positive, then we can get back out to business and everybody is good to go, then I'm fine with that," McBride said today in an interview with Computerworld. "If that's one of the outcomes of this, then so be it."
Also, yet another computerworld article indicates that most of the press and analysts who have been invited to take part in SCO's "public review of the infringing code" have declined... apparently due primarily to concerns over the terms of the non-disclosure agreement SCO is asking them to agree to. Linus in particular has said "no way" to signing their NDA to look at the code."
If SCO has to give 95% of UNIX royalties to Novel, and SCO wins a suit (right after a bunch of pigs fly overhead) based on that IP, doesn't that mean that SCO would have to give 95% of the winnings to Novel?
Beep beep.
Any chance IBM's legal team could string together SCO's actions of the last couple of weeks and make a case that SCO was trying to blackmail IBM? Maybe there's a RICO case here. Ha.
... try getting money other ways, I guess. SCO Unix sucks the butt. If it didnt, and if it were actually a market contender, I can't imagine they'd be grasping at these straws. The buy-out seems like a sensible motive, and sure as heck doesn't consume me with dread the way that a "sco unix is the only unix" world does.
Another damned comic
+++ NO CARRIER
Linus is right;
... Fairly entertaining," said Torvalds.
Torvalds in an e-mail interview compared the fight between SCO, IBM and Novell Inc. to bad TV. "Quite frankly, I found it mostly interesting in a Jerry Springer kind of way. White trash battling it out in public, throwing chairs at each other. SCO crying about IBM's other women.
Pass me the popcorn.
On a more serious note is the statement that;
[Micheal] Overly said a review of the code by anyone other than a judge "means absolutely, positively nothing" in determining the merit of SCO's claims.
So basically, the word from a legal expert is 'lets get this to court, shall we?'
Bring it on Darl!
An infinite number of monkeys will eventually come up with the complete works of
IBM should flip SCO off buy buying Novell and releasing Unix under the GPL. SCOs legal case (or bluff) would instantly disolve.
It's the source for SCO's brand of UNIX, not for Linux.
While SCO alleges that part of the Linux sources are copied from their OS, it's not like SCO's UNIX is Linux.
(It'll still be interesting to see SCO trying to prove that somehow someone copied the source of closed-source software to use it an a GPLd piece of SW. After all, they'd also have to disprove the far more likely alternative that one of their developers illegally copied Linux freely available GPLd code to use in their closed-source kernel.)
Investors should have known better than to back an obvious loser so if you've got SCO shares at this point you've got to be pretty daft.
Ideally, this time next year, SCO is just a bad memory.
SCO unilaterally rejected Novell's claim to hold the UNIX IP that Linux allegedly infringes against at their press conference on Friday. But I remember that Perens and others pointed out the ownership information associated with the copyrights and patents was clearly attributed to Novell.
Can someone please point out which patents and trademarks were in question, and how to verify that these artifacts actually *do* show Novell's ownership?
(IP Lawyer question:) Is that information normally changed when IP changes hands through an agreement such as the one between Santa Cruz Op. and Novell? (i.e. whould the data in the patent office or LOC be an up-to-date represenation of current ownership?)
will have to deal with the fact that no one in the *nix community will ever want to do business with what is the current company.
If IBM buys SCO, and I hope they don't, they should gut SCO for their customers base, engineers, and products, and can everyone else working there.
Even if this results in a massive win for SCO, I see them getting no new business in the future due to the trouble they have caused. Linux code will be rewritten in a week or so, and SCO will be left with perpetually declining sales.
I always said that Red Hat should have bought SCO with inflated stock shortly after Red Hat's IPO several years ago. We could have had all of SCO's customers on Open Source by now and there would be no IP disputes.
They already got $1G from Microsoft. Why not return that money to shareholders, wind up the company and go home?
Last time I looked SCO's market capitalization was only $40M or so, which reflects the market's judgement that SCO's management is not going to make good use of the cash windfall, so its value when tied up in SCO is a lot less than the cash value.
Unless Novell is getting 95% of the payment Microsoft made? Which would explain why the share price is so low, and deflate conspiracy theories about Microsoft funding a lawsuit. (Although $50M is still a handy sum to throw at the legal system.)
-- Ed Avis ed@membled.com
Expect IBM to make an offer for SCO, to publically announce that it has now "bought the rights to Linux", and it will start to assert control over it.
Sleep with an elephant at your own risk.
Sig for sale or rent. One previous user. Inquire within.
Sounds good. To prove that, why don't you go steal some MS source code, submit it as blabla.c, and see if it gets into the kernel. You might find that Linus absolutely does not just "let anybody's code in" the kernel.
Have you noticed that it was registered only 12 days ago?
:)
So, anyone out there bought the domain? We'll all help with content
An infinite number of monkeys will eventually come up with the complete works of
most of the press and analysts who have been invited to take part in SCO's "public review of the infringing code" have declined
reminded me of the title of that movie with Tony Curtis and Brian Keith suppose they gave a war and nobody came?
I just think that is funny. They invited everyone to come look at the "evidence", but they made the conditions such that nobody will play.
"Well, we provided an opportunity for the community to come and see -- they chose to stand us up."
Wasn't there some "11 o'clock" meeting that they held up where they invited Novell to come and talk this over and nobody showed up? Seems pretty transparent to me.
Is anybody buying this? Apparently not, given the drop in their stock, eh?
There is much cruelty in the universe, John.
Yeah, we seem to have the tour map.
I know at least two people who bought Caldera stock around IPO time because it was a Linux company. They believed in Linux as a product, wanted to support Linux development, and thought there might be some future profit in it.
I've heard a lot from them over the last week. With Caldera/SCO's current action, they've ended up as pawns in a game to attack Linux -- not at all the reason they invested their dollars in the beginning. They have decided to sell out as a result of the SCO action, and have lost significant money in the process on Caldera/SCO shares alone. But they also realize that the dollars they had invested this company have supported action which may eventually reduce the value of their larger holdings in other Linux companies. I can understand the frustration that they must feel.
I'd venture to say a lot of Caldera investors may be in the same position. So what's this about "rights" of the shareholders?
STOP . AMERICA . NOW
Assuming that SCO isn't bought out... and they go to court and lose (as seems likely) and somehow stay in business... how on Earth could they ever repair their reputation now?
They've become notorious lately. So much so, in fact, that I'd bet even if they won a court case and were proven correct, that they still wouldn't be able to recover from pissing the world off. How many people avoid Microsoft because of what they stand for and not just because they believe other software is superior? Uh-huh. See?
If you are concerned over the treat of lawsuits over intellectual property then you are actually in a better legal position using GPL'ed Linux than using Microsoft's products.
While SCO has yet to provide any publicly available substantial evidence in their case against IBM and Linux, Timeline Inc has already won a US Washington Court of Appeal judgment against Microsoft in another contract dispute.
Unlike companies like Oracle Corporation and others, Microsoft chose a cheaper option when licensing Timeline Inc's Data base technology. That license puts developers and users of Microsoft SQL Server,Office and other Microsoft product at risk of being sued by Timeline Inc for violation of Timeline Inc patents.
Microsoft's products do not provide users and developers an absolute safe haven from the threat from lawsuits based on violations of intellectual property. Microsoft's EULA provide the developer and end user with no protection against threat from current or future intellectual property lawsuits.
However, since the SCO Group has knowingly sold and distributed the GPL licensed Linux kernel and other components, it must by the terms of the GPL license, provide all those who receive the code from them an implicit license to use any intellectual property, patents or trade secrets which SCO owns and is used by the GPL'ed source code. That implicit license to that SCO intellectual property is also granted to anybody who subsequently receives the GPL source.
The GPL only grants the right, for reasons of intellectual property infringement or contractual obligations, to stop distributing the GPL'e binaries and source code if the conditions are imposed upon you by a third party. Since SCO claims ownership the intellectual property in question, it must grant all subsequent recipients of the GPL licensed source code SCO has distributed and any GPL'ed derivative, the same implicit licence and right to SCO's intellectual property the code imposes upon.
SCO has acknowledged deals with Suse and Lindows to distribute SCO's intellectual property in GPL'ed Linux, but the GPL license does not grant anyone or any organization the right to append extra terms and conditions upon the recipients of the GPL licensed source code.
It is very easy to effectively fold the current development branches of the Linux kernel and any other GPL'ed code back into SCO's distributed GPL'ed sources. This would grant the same implicit license for the infringed SCO intellectual property to the all the current development.
You are in a better legal position using the GPL'ed Linux platform and other GPL'ed software, than you are using Microsoft's or any other closed source software.
McBride said his company will open samples of its contested code to interested parties next week under nondisclosure agreements so SCO can prove its points. The open-source community, however, won't be be given an opportunity to remove any offending code and replace it with new material, he said. Instead, damages will continue to be sought.
So in other words, he's going to let people examine their "evidence", and allow them to come to their "own conclusions", but prevent them from disclosing any proof to the public of the validity of their conclusions. In other words, we're back at square one -- a whole lot of unsubstantiated allegations, no proof. Btw, even if there are "hundreds of lines" of shared code, that does not prove that they were copied into Linux from SCO. It's much more likely to be the other way around.
Btw, can't Linux just sign the NDA and then -- if he finds anything -- remove it from Linux?
It's sort of like somebody stealing your car, and you hunt them down and you find them, and they say you can have your car back, but there's no penalty for that
Except Linux (nor GNU/Linux) has stolen nothing, nor has IBM, from SCO. Even if that allegation were true, the fault would lie with IBM, not the FOSS community.
Giga Information Group Inc. analyst Stacey Quandt said she has discussed SCO's offer with her legal counsel, and if she signs an NDA, it may hinder her ability to write about it.
In other words, SCO has stacked the deck. People can review their code under these terms, but can't write in any convincing manner to the public about their findings.
[Giga Information's Stacey Quandt] has advised clients of Cambridge, Mass.-based Giga to continue with their Linux adoption.
In other words, SCO's absurd allegations aren't driving people away from GNU/Linux.
They don't want to tell; they want to sue. -- Linux
That just about sums it up. Except that IF their claims are valid, they gain nothing by with-holding the evidence. They cannot claim before a court of law that they should get continued damages when they could have allowed the FOSS community to remedy the situation.
[Stamford's George Weiss] said SCO is making its case based on "vague inferences" and is asking analysts to do the same
It appears the experts agree with me.
[Framingham's Dan Kusnetzky said, "I'm not sure that showing us the code would prove anything to me, because I don't know where it came from"
As I said before, it will be difficult if not impossible for SCO to prove where their code came from, the dates on it, etc; whereas proving those things will be easy for FOSS.
Even if there is similar code, that doesn't mean there is infringement, especially under copyright law "fair use" provisions, said Overly. "If I take a piece of code that someone has written, take it verbatim but expand on it and use it for a completely different work, that may or not be copyright infringement"
Another problem for SCO's absurd case.
a review of the code by anyone other than a judge "means absolutely, positively nothing" in determining the merit of SCO's claims.
A review by people other than lawyers will give you the real truth on the matter. Though a judge can give a legal ruling, it will invariably be false, as judges understand about as much about computer code as I understand hieroglyphics.
legal experts said Linux users have to pay attention to the fight. "The fact that you ignored it could potentially cause your damages to increase substantially"
Actually, GNU/Linux users can ignore this all-together. The user faces no liability what-so-ever. Nor, in fact, can anyone be said to be liable other than IBM, for they are the only ones who were in a position to know what was and was not proprietary SCO code. No-one else, not the FOSS community, not GNU/Linux users, nor GNU/Linux companies, were in any position to have any possibility of knowing that (because SCO's code is closed).
social sciences can never use experience to verify their statemen
[100% ISO 646 Compliant]
SVM, ERGO MONSTRO.
I don't know if you have considered this. AT&T bought NCR in 1991 and sold it again in 1997. It's on NCR's history page: http://www.ncr.com/history/history.htm
As far as I can gather, NCR started production of the 3000 series from Sep 1990 using 80386/80486 chips:
Model [#CPUs] Manufactured from
NCR3320 [1] Sep 1990
NCR3450 [1-4] Sep 1990
NCR3550 [2-8 ] Sep 1990
NCR3600 [8-288] May 1991
Later Pentium-based servers were released as this news release shows: http://www.att.com/news/0593/930517.ncd.html
All these systems run System V.4 in what NCR calls Massive Parallel configuration. So evidently AT&T had the knowledge of how to build multiprocessor systems back in 1991. However, some proprietary hardware was used to to keep the processors in sync. The question is how much of this was made available to SCO in 1995. If they had full access to this information, they would not have been able to use it, as they don't produce hardware, but maybe they now think they can tweak it to run on modern Pentium chips and seize the highend of SMP solutions.
It could also explain how SCO can assert they have experience in 8+ CPU multiprocessing even though this capability doesn't show up in SCO's products.
A thought just occurred to me: What if SCO appropriated Linux code? If their aim is to present a position to IBM for buy-out, why not copy a bit of Linux code that has been introduced in the last year into SCO, go back to the back ups, alter a few time stamps and insert the code into SCO Unix? Then, *poof*! Instant infringment! The very fact that they want to keep things under wraps until trial is because they are going to petition the court to keep the code secret--we will *never* get to see the infringing code. I suspect that they very much want to keep what has been "stolen" under wraps so that only lawyers will get to decide whether it was stolen or not and not someone with a technological clue.
Bel, the mostly sane.. "Of course I can't see anything! I'm standing on the shoulders of idiots." -- Me
Query: Does anyone have a link to the text of the non-disclosure agreement the SCO are wanting the experts to sign?
I'd quite like to have a look at exactly what is being asked of the experts.
An infinite number of monkeys will eventually come up with the complete works of
Why don't they load a database for an installation of this software with code that is indisputably "clean" like the BSD code, code that is clean because it was released in the GPL'd Caldrea releases, the Lindows code they used with SCO's blessings, etc. Put in all the legitimate sources Linux developers could have used as inspiration, then load the current distro OS source, run a comparison and see how much came from "legitimate" origins. The remainder is original work OR possibly bastard code stolen from a illegitimate source.
Do the same with SCO's code, rev by rev, and see if there is any overlap. If there is stolen code, there will be identical text. If something is the same in Linux and SCO's UNIX ... check the dates to see who wrote it first.
With this method, NO ONE has to see the source code but the people running the software that does the analysis, and even they just load it into the database. They need not be programmers because they just do a "pedigree" check on the code. In fact they should not be programmers ... anyone can ifentify a string of matching ASCII text. They would not be hindered by an NDA, and would be EXPECTED to testify about the results.
Well, it's not that simple either...
There are several ways this can go.
IF this comes down to patents, which is unlikely, then every copy of linux using the patented method would be in violation, and SCO could force everyone to stop using that method (in theory, anyway). This is highly unlikely, and they haven't mentioned patents yet. Furthermore, if it was about patents, there would be no reason to keep it secret before trial.. as their methods would be protected no matter what.
If it comes down to Copyright, IBM would pay damages, but the rest of the world would not be guilty of anything; pretend for a minute it's not Linux, but some version of OS/2. Would everyone who IBM sold OS/2 to have to stop using it or face legal action? Hardly. OF course, linux being free, it's a bit different.. but fundamentally, it's the same. And I'm sure the community would happily re-write the offending section, or find some code that pre-dates it and work from that, to be fair.
What is most likely, and what SCO seems to be saying, is this is trade-secret stuff. The thing about trade secret is, it only applies to secrets. That's what the NDAs and other contracts are for... so if IBM leaked proprietary methods (NOT patents... just thigns where two parties agree to keep it a secret) into the linux kernel, then they violated a contract... and they will pay damages. However, again, the rest of the community faces no threat. Trade secret laws are NOT patent laws, they don't afford you protection of something indefinately.. they only let you keep somethign a secret. If it's in the linux kernel, it's just not a secret anymore. If you leak a trade secret, say the formula for Coca-Cola, to usenet, you are gonna be in deep shit, trade secret laws will down on you, but coke has no way to stop the world from knowing about their formula now, and can't prevent someone from using it.. that's why they KEEP IT A SECRET... made in parts by separate companies, mixed at the factory, with the forumla only known to a couple people, and the files locked in some super secret vault guarded by alligators.
If SCO 'knows' there is Unix code in Linux, doesn't that mean they could have had their engineers (or someone else who has access to the Unix code) study the code to benefit their own? I doubt a point like this would ever come up in court because it's pretty loaded and would be hard to prove but it is something to think about... And it may not even be illegal assuming they didn't copy and paste.
'nuff said.
The good - someone like IBM buys them out and M$ can (snicker) "license" all they want from IBM. Or they fade away because of the clout of the Linux (GNU/OSS/FSF) community.
The bad - everything stays as is right now and we all ride the FUDtrain (or at least the ones who believe it.)
The ugly - M$ does some silly stupid crap to keep this thing going.
FLR
Let a few rumour slip to the press that the $10M is the price they estimate the court case will cost and thet they think they will be unable to collect the expected Damages against SCO they court will impose.
That would make their stock price crash to around $2 for a Capitalization of around $15M, then have a RedHat led consortium offer $20M or so, that will likely be accepted.
IBM can then buy some of the SCO contracts from RH and a later date.
That way there will be no impression left that IBM gave in to Blackmail.
Help fight continental drift.
Sure, we could all sign an NDA and then look at the SCO code, but most of us are not interested in what the SCO code is. We simply want to know what code in LINUX has been, apparently, copied, from SCO, without permission. For this no NDA is needed, since that code is clearly already available to the public. SCO does not appear to be willing to do this, since it knows that a public discussion, on what is available to be seen,would likely kill its case. Until SCO stops throwing FUD around, I like many others are going to have a hard time taking them seriously. The only thing we can do is wait for SCO and IBM to hash it out in the courts, as SCO appears unwilling to provide any evidence to the press and the public in general.
Jumpstart the tartan drive.
Let's see if we can pool a bunch of $ togther and buy them ourselves. Then, we can release the SRV code to the public. It's not such a crazy idea, it's happend in the past wth other products.
Karma: The shiznight, mostly because I am the Drizzle.
What I find amusing is that if we are to believe that MS made the agreement to license SCO IP before all this mess occured, then MS agreed to pay 10 million to a company that at the time was barely worth 12 million.
I'm sure the only thing preventing MS from a purchase [of SCO] is the legal problems it would cause.
The trust issue is more complicated than "users perception of Linux".
Free software and the GPL in particular haven't been thoroughly tested in court. This is a position similar to "shrink-wrapped licenses" a few years ago. How can I "agree" to a contract I can't see until I open the package? Courts are sticking with the idea because it is established industry practice. Like free software licenses.
Mostly, free software depends on custom and trust, not law, despite the legal-sounding language of the GPL. We *hope* the courts won't destroy our community, just as we *hope* congress won't. But they can and might. The price of freedom....
In any event, sure, trust is and will be harmed. So how are we going to keep the trust levels up, in the face of concerted, co-ordinated attack?
Even stranger than that, is UnitedLinux, which people seem to be forgetting about. If SCO knew that there were IP violations in Linux while they were working on and promoting UnitedLinux, something isn't lining up right.
Also, this was almost certainly an exit stragegy. If you look at there stock price before and after their filing the complaint, its very obvious they wanted to use this to bump up the cost of the company long enough to get bought by IBM to make them go away. Unfortunatly for them, companies started coming out the woodwork to actually fight them.
SCOX/Caldera has got to still have a few Linux developers/enthusiasts emloyed there. How about an insider's view? It's not hard to post anonymously..
What do employees think of this stuff? Do they feel there is some basis for the claims? Are they fighting against this internally?
Microsoft has learned, the hardway from AOL, that you can fight your opponents simply by buying up a company that has litigation potential.
If Microsoft was to buy SCO they would litigate against every Linux company for years AND at the same time ensure that all current SCO UNIX customers have a "safe" migration path to Windows servers.
There is an American legal theory called "legal realism" that says a law isn't a law unless people think it is and calculate their actions based on that assumption. If corporations shy away from the GPL, it doesn't matter who's right and wrong.
Anyway, a while back there was someone arguing that the GPL *won't* hold up as a license, but that it will perhaps be accepted as an industry practice.
The courts that supported shrinkwrap EULAs didn't establish a new legal principle that you could give someone an agreement under other circumstances (in junk mail envelope, say) and establish a contract by the mere act of opening it. But they upheld the software industry's customary practice.
We won't know the law until the court makes it. That's the thing about novel situations--there's no "custom" to fall back on.
A more alarming possibility is that the courts will decline to rule on the GPL because we have this or that international treaty
International treaties rank with constitutional amendments on the legal food chain, except they *aren't* reviewed by the Supreme court. They are "legislation" + "executive action" and outside court competencies--except for the World Court which we don't recognize.
So 67 men in the Senate (and maybe a woman or two) can end the GPL with one vote and no judicial review.
The future of Linux will be decided in Europe and an American treaty with the EU, not in American courts, my friend, and maybe the GPL too.**
=googol=
** The European Charter has "IP rights" written in as a fundamental property right. All it takes is one treaty where we ack the EU charter and promise conformant legislation and the FSF gets on the "xenophobic terrorists who use military grade weapons" list (xenophobia is an extraditable EU crime, IP is an inalienable property right, and encryption is a military weapon. Also, War is Peace and Ignorace is Slavery).
1. The SCO/Novell contract allows SCO to grant license to other parties to distribute the code. If this is true, it could be argued that since SCO is distributing the code in a GPL'ed product, that they are doing so under the terms of the GPL, and thus the code is now covered by the GPL. If the contract says that the sub-license can't be compatible with the GPL, then Novell needs to sue SCO for breach of contract.
2. The SCO/Novell contract doesn't allow SCO to grant distribution sub-rights to others. In which case everybody else sues SCO for violating the GPL.
Then where are the countersuits if #2 is the case? Why haven't RedHat, Mandrake (ok, I know they are broke), Linus, Stallman, ESR, Perens, SuSE, and the rest fired back?
I'm no fan of SCO, and I recall IBM not acting nicely, once upon a time, but the silence on the legal front response-wise is getting deafining.
Can anyone point me to *any* response by IBM?
Dollars to doughnuts something like that's the case with every single one of their 10-to-15-line "violations".
It's like in biology everyone got excited when Stanley Miller made some racemised amino acids from crude chemicals plus electricity in a cunningly arranged apparatus. He got amino acids because that's the way chemistry works. You won't get proteins the same way because that's not how chemistry works.
Through a similar process, I would expect to see many dozen-line chunks of near identical code in any two large code bases addressing the same problem. Or even addressing different problems.
There's also a lesson to take home from statistics. One common trick pulled by statistics tutors is to split a class into two, and get half the class to toss a coin 100 times and write down the results, and the other half to "toss coins" in their heads and write out the results. The tutor can pick out the fake coin tosses because they are too even, there are no runs of five or six of the same side.
The complete absence of similarities would be strong evidence that someone had seen both SCO and Linux code and deliberately removed the similarities. The brain-breaker for the judge would be: does this negative evidence of awareness of SCO's code constitute misappropriation of trade secrets or abuse of contract? (-:
Got time? Spend some of it coding or testing
Everyone uses Roberts Rules of Order .... which are great - simply move something that requires a vote "I move a motion of no confidence in the chair under the 1906 senility act" or "I move that there be no smoking in the room" - then have a bunch of others disagree - force a vote - demand written ballots - if they insist on a voice vote demand a vote on that .... and demand written ballots .... if they don't agree keep recursing on votes on written ballots - otherwise on to step 2 - challenge the scruiteneers for the written ballot - demand a vote (even put up 2 competing planks) - demand a written ballot on scruiteneers, recurse for ever ...
We did this once in an AGM managed to have a motion of no confidence in the chair illegally squashed which ment that the companies books were not legally adopted and they were in position where a shareholders suit could have stopped them trading dead.
These meetings were so much fun - old guys in suits who were used to having an AGM once a year where 2 other guys would show up and ask why the dividend wasnt as high as last year, then they'd all retire for a sherry. They were faced with 100 really pissed shareholder with a game plan ... faced with this the chairman turned so red in the face and got so angry I swear I thought he was going to explode ....
Now if only the US had the same small shareholder protection laws that NZ does we could all power on down to SCO and have some fun ....