Red Hat Cornering SCO in Delaware

LordNite writes "There is a great article over at Groklaw on the latest motion in the RedHat's Delaware suit. RedHat has filed for the start of discovery. Looking at the list of documents RH is requesting it looks like SCO will finally have to come clean. Naturally SCO is trying to stall. It looks like the beginning of the end of this whole mess." The faster this can get into court and be over, the better.

Comments

Linux Lottery?

[taviso]

45. All documents concerning a Linux Lottery or the phrase the "Linux Lottery'.

Thats a new one on me, anyone have any clue where this phrase comes from or what it means..why are RH interested in it?

Re:Linux Lottery?

[taviso]

Ahh, Found the answer in a court transcript, here.

In sum, SCO's campaign is designed both to slow the growth of
LINUX, and to reverse its failing fortunes by convincing LINUX users
that they need to pay SCO a license fee to use the lower-cost LINUX
operating system. As SCO's own representatives have proclaimed, if SCO
is successful at this effort, it can add "billions" of dollars in
undeserved revenues to its declining bottom line. Additionally, SCO's
campaign is designed to further what, upon information and belief, has
been referred to as the "LINUX Lottery" -- the ability to reap personal
profit by carefully timed purchases of SCO stock.

Re:Linux Lottery?

[Gzip Christ]

Ahh, Found the answer in a court transcript, here.

Damn. I was hoping it was this type of lottery. Oh well - in that case, I'm no longer rooting for Darl to win.

--------
The fake Gzip Christ isn't not user number ~0xA6CA7

SCO does'nt seem to be in a hurry

[gokulpod]

The article mentions that SCO is trying to stall as much as possible. Probably the executives at Santa Clara have'nt sold off all their shares yet. Once that is done, you can be sure to see the cases flying off the shelves.

Re:SCO does'nt seem to be in a hurry

[mst76]

The article mentions that SCO is trying to stall as much as possible. Probably the executives at Santa Clara have'nt sold off all their shares yet. Once that is done, you can be sure to see the cases flying off the shelves.

Also, McBride will get a large payoff if he manages to get 4 consecutive profitable quarters. He only has 2 more to go.

Red Hat

[micaiah]

Sure, Red Hat has a vested interest in defending Linux, however, there are more companies like Suse, who could take up the fight, but aren't. Kudos to Red Hat. This is one reason why I still buy and support Red Hat.

Re:Red Hat

[Xanthian]

Suse has already openly supported RH's direction. I'm sure one of the reasons they're not more active in the fight is that SCO has already been stopped in Germany.

Re:Red Hat

[nutshell42]

SuSE's a European company and afaik in most countries here there are injunctions in effect preventing SCO from FUD-spamming like they do in the US.

Why should SuSE do the work for Red Hat when Red Hat's twice as big and much more dependant on the American market (also afaik =)

jm2

Re:Red Hat

[micaiah]

"Why should SuSE do the work for Red Hat when Red Hat's twice as big and much more dependant on the American market (also afaik =)" Because Suse would be defending Linux as a whole e.g. the kernel, which is under attack. It has nothing to do with Red Hat's distro.

Re:Red Hat

[MadMoses]

SUSE has already successfully filed a suit against SCO Germany a long time ago, with the result that SCO Germany is not allowed to say that Linux includes code that infringes on SCO's copyrights.

Here's Suse's press release (german).

Re:Red Hat

[Zocalo]

SUSE has already successfully filed a suit against SCO Germany a long time ago

Indeed, and unlike Red Hat, SUSE didn't wait for a lawsuit to arrive before sucessfully going to court for their injunction. I guess that lends further credence to the maxim that the best defense is a good offense, so let's hope that the strategy pays off for the ACCC down in Oz too. ;) Still, every little bit helps with bleeding them dry. The more court cases SCO has to deal with the less chance that Darl will get his Golden Parachute for four profitable quarters in succession.

Re:Red Hat

[gmkeegan]

... but I have a hard time finding SuSE in North America, that's a nieche market for them.

I think you mean Nietzche market. (That which does not kill -9 me, makes me stronger?)

Can the judge tell if SCO is trying to stall?

[tehanu]

I am not a lawyer so maybe some people with more experience can tell me - is it usually obvious to a judge (it may be obvious to us in the case of SCO, but that's an entirely different matter) if someone is trying to stall for time, how do judges usually look upon this sort of behaviour (do they shrug their shoulders or get pissed off?) and if they do get annoyed what can they do to the stalling party?

Re:Can the judge tell if SCO is trying to stall?

[Entrope]

The court and representation for each side talk and negotiate deadlines for particular stages of the trial. I imagine that there are common standards for each stage. The judge and Red Hat have interests in seeing Red Hat's case executed in a timely manner, so it would be somewhat difficult for SCO to extend the deadlines greatly.

It is possible to file motions or amended actions later to delay or reset the clock. If the judge believes they have merit, it will go through[1]. If a party to a lawsuit submits many such motions and they are largely frivolous or unwarranted, it may count as vexatious litigation. If a judge considers something vexatious litigation, he or she will generally sanction the offending party. Sanctions can many forms[2].

IANAL, etc.

[1]- For example, SCO recently got a delay in its trial versus IBM so that it could perform due diligence and research in their counter-defense.
[2]- Monetary fines are common, but others are possible. The US prosecutors in the Zacarias Moussaoui were barred from seeking the death penalty or introducing broad classes of evidence when the government refused to comply with a court order to give him direct access to certain terrorist suspect-detainees.

SCO execs cash in on suit spotlight

[Solokron]

You got that right.

http://zdnet.com.com/2100-1104_2-5057033.html

Could this massively implode on SCO?

[swb]

Is there a chance that this could massively implode on SCO?

I'd wager there must have been some "UNIX" code in Linux at one time, albeit not intentionally and perhaps only small chunks for SCO to have made any claim at all.

But let's presume that RH's discovery finds the code was relatively small, inserted accidentally or under false pretenses, and not part of the current development of Linux.

Could SCO then be shown to be grossly misrepresenting their claims and mooting any licensing claims they made and perhaps open SCO's executives to claims of fraud, stock maniplation, or at least highly vulnerable to civil action from companies who could claim their misrepresentation had a chilling effect on their business?

If someone can get the man behind the curtain exposed, this could all come crashing down around the SCO guys..

Re:Could this massively implode on SCO?

[badasscat]

The worse that could happen is that they fold, maybe less of a loss to these guys than you think..

No, the "worst" that can happen is they get busted for running a pump and dump scheme by the SEC. Not to mention corporate fraud, insider trading and god knows what else; I'm sure there are a variety of charges that could be leveled if it turns out they were intentionally misleading investors for personal gain. This is serious stuff; this is not just slap on the wrist territory. We're talking some real prison time here.

If these allegations by SCO do all turn out to be completely false (as is likely), and it does turn out that SCO knew it (50/50 - I think it's just as likely they're just totally clueless), then the SEC will have to get involved in order to send a message to the rest of the corporate world that this sort of thing cannot be tolerated. If SCO execs actually succeed in taking a failing company and turning it into a personal gain for them through fraud, there will be no end to these sorts of actions by other executives at other failing companies in the future.

Re:Could this massively implode on SCO?

[swb]

The difference being that Ken Lay and his company are from Texas, where the current President is from and who was Governor. Lay and Enron were big contributers to the GOP and Bush for a long time, and likely circulated in the same social circle as the Bush family (oil/energy, Texas, wealthy, politics, the overlap is massive).

The Enron prosecution isn't done and Lay isn't out of the woods yet. There was just recently a news blurb about Lay refusing to hand over documents in his possession, citing the 5th Ammendment.

Darl is probably the only "name" exec at SCO and is a "name" only for creating this fiasco. While probably "connected" politically in the same way all wealthy CEO types are, I highly doubt he has or can even buy the juice that Lay had with the GOP pre-Enron. Not from the same state or industry as many Bush insiders, nor does he have the non-business political standing.

Furthermore, he's created enemies at bigger businesses like IBM that have heavier hitters than him, with longer, deeper political connections and from bigger states, mitigating any potential political advantage he *might* have had.

And remember, Sam Waksal from Imclone is *already* in the can, Martha Stewart faces a fraud trial that could land her in the can, too, and the guy from Tyco I believe will likely enjoy the a nice long membership at the Orange Jumpsuit Country Club.

Overall, I think McBride is *just* the kind of sacrificial lamb that the Justice department and SEC would like to see turning on a spit over an open fire. Not politically connected enough to be a threat to them and reaping major political benefits for the overly-pro-corporate Bush administration when he gets a public hanging.

Protecting trade secrets

[sjbe]

I think it is also funny that they are concerned about "trade secrets" when everyone knows how Unix works. There is no big mystery.

Disclosure IANAL...

Don't be quite so quick to jump on this one. While I agree with you completely in principle, SCO does need to be careful in reality. Trade secrets are just that, secrets. Once they are discovered, they are no longer entitled to trade secret protection, meaning they cannot sue the releasing party if they were released illegally. Typically if there is a real trade secret, most reasonable judges will (rightly) make some accomodations for that fact.

Presumably SCO has a few trade secrets even though you are right that we basically know how all their stuff works. Just because we can figure it out, doesn't necessarily mean it isn't protected as a trade secret. So it's not surprising that they would be careful about trying to ensure they aren't unecessarily made public. Any company with proprietary assets in a legal battle would do the same. You can argue that they don't deserve such protection anymore because of what they are sueing for (and I wouldn't argue with you over it) but you should not be surprised that they are seeking trade secret protection. It's just a normal part of the legal proceedings.

Re:Protecting trade secrets

[schon]

Once they are discovered, they are no longer entitled to trade secret protection, meaning they cannot sue the releasing party if they were released illegally.

The thing is - anything that's in the Linux code base by definition is not a secret.

Nobody's telling SCO "show all of your code" - they're saying "which lines of the Linux source do you believe is infringing?"

The only reason not to answer that question is that there is no infringing code.

Re:OT: Stowell unix licenses are revokable!

[ninthwave]

Note in the quote of the license by nice SCO people it says

If LICENSEE fails to fulfill one or more of its obligations under this Agreement, AT&T-IS (AT&T Information Systems) may, upon its election and in addition to any other rememdies that it may have, at any time terminate all the rights granted by it hereunder by not less than two(2) months' written notice to LICENSEE specifying any such breach, unless within the period of such notice all breaches specified therein shall have been remedied; upon such termination LICENSEE shall immediately discontinue use of and return or destroy all copies of SOFTWARE PRODUCTS subject to this Agreement.

I think there is an argument on the phrase in bold I added. SGI says they have remedied the breaches SCO says it is not enough.

Groklaw Article

[Mostly a lurker]

I found a backdoor to this (sorry about the formatting):

SCO Files 2nd Motion Asking the Red Hat Judge for a Delay on Discovery

Thursday, October 09 2003 @ 04:25 AM EDT

There has been quite a lot of activity in the Red Hat case.

SCO filed a Motion to Dismiss the action in its entirety, as you know, and Red Hat filed its answering brief. But since we last reported on this case, Red Hat initiated discovery. They asked SCO for documents and for answers to some pointed questions. IBM is forcing SCO into a corner in Utah, and Red Hat is forcefully and aggressively trying to do the same in Delaware. You'll see, I think, that we haven't been wasting our time telling the world the details of this story. The big picture is that Red Hat is telling SCO to prove their allegations with specificity. They also want all their source code, and I'm sure you can figure out what they want to do with it, when I tell you that they asked for the complete Linux Kernel Personality source code, among the other products for which they have requested source code.

They also want to hear some details about the relationship between Canopy and SCO, including any stock or intellectual property transfers. They want SCO to "identify by title, version, module(s) and line(s)" what they think is misappropriated in any way or in violation of any of its rights. They ask for the details of Microsoft and Sun's licensing arrangement with SCO. They want to know who those 1500 companies were that got the letter, and what happened next. They want to know exactly what SCO has filed a copyright on. They want all the details of SCOsource, including all the folks who have seen the code SCO has been showing under the NDA and what they saw, and any other contact with any Linux users about supposed liability. They want to know how they compared the UNIX and Linux code to determine infringement. They want to know if they've done any comparisons of the two and what the results were. They want to know all the stock or industry analysts SCO has met with or talked to and what was said. In short, it's like the kind of fantasy a guy might have about a bully getting his at last, because they asked them everything we wanted somebody to finally ask SCO and make them answer.

SCO responded to Red Hat's discovery requests by filing a new motion, and it has told the judge, in a Motion to Stay Discovery Pending Resolution of Motion to Dismiss, it would like a delay until after the first motion, the Motion to Dismiss, is ruled on. They surely don't seem in any hurry to get this matter resolved. They argue that because they are simultaneously providing discovery to IBM (of course IBM says they aren't seeing anything, as I recall), they can't possibly do both, and anyway, if they win their motion, it'd be moot. In short, they would very much like not to have to do this, presumably so that if they win the Motion to Dismiss they can continue to refuse to give any particulars about their case. If the judge doesn't grant their Motion to Dismiss, they'd like the judge to give them 30 days to provide all the discovery items.

Both of Red Hat's discovery documents are attached to this SCO Motion to Stay Discovery, and they begin with definitions, like what is "intellectual property" within the context of the document, and instructions, like how to identify the writers of documents, etc.. The first document begins on page 7 of the pdf, but we find out what Red Hat is asking for on page 12, where the list begins.

Red Hat in its "First Request for the Production of Documents and Things" asks SCO to produce the following documents:

1. All documents concerning the subject matter of the Complaint.
2. All documents concerning any customer, or potential customer, of Red Hat.
3. All communications between SCO and Red Hat or any employee of Red Hat.
4. All communications between SCO and any user or potential user of a Linux product, including Red Hat LINUX product, concerning any rights to Linux, or UNIX th

Re:Scox yesterday....

[Rogerborg]

> I predict that today the stock value will mirror yesterday, it may even end slightly up. This is because little or none of the news read here at /. and other such places is getting filtered through to wall street.

Actually, the reason is that you buy stock like SCOX as a speculation, not an investment. It's a simple theory that boils down to this: no matter how dumb it is for you to own the stock, someone dumberer will buy it off you for more.

So far, that seems to be a pretty accurate assessment.