Slashdot Mirror
SCO Names 1st Lawsuit Target: AutoZone [Updated]
An anonymous reader writes "News.com
reports that SCO has filed the first (of two) soon to be infamous lawsuits. This one is aimed against car part retailer AutoZone, a multi-billion, Fortune 500 company according to the site. Who's next?" Another reader excerpts from SCO's posted claim: 'AutoZone violated SCO's UNIX copyrights by running versions of the Linux operating system that contain code, structure, sequence and/or organization from SCO's proprietary UNIX System V code in violation of SCO's copyrights.'
Update: 03/03 16:28 GMT by T : njan writes with the news that SCO just announced during their ongoing conference call another lawsuit, this one "to be filed against Daimler-Chrysler, alleging that they are infringing SCO's copyright by using code relating to 'core operating system functionality' of SCO System 5."
Or perhaps SCO hopes to take on Sun as well?
http://alternatives.rzero.com/
The crux of this SCO case seems to not be "Autozone are using linux, and linux contains SCO code (millions of lines or just a few .h files) therefore they're infringing IP" as their press release propaganda infer, but that:
1. Autozone used to use SCO products, and their whole system relied on them
2. Autozone converted to Linux, and IBM made them do so
3. Autozone's custom software which used to run under SCO products now run under Linux
4. They still run well and changed over efficiently, therefore they MUST still be running SCO code/shared libraries/etc with linux to do so, which is a breach of their original contract with SCO.
SCO seem to be insinuating that this is about copyright SCO code in ALL of linux, and autozone are just one of millions of linux users who are infringing, but the details of the case show this is NOT true at all. That makes it FUD. The press have been told for MONTHS that SCO are taking issue with code in linux in general, but now legal action is underway, it's in a case that takes issue with existing SCO code used in linux by a client. No damage to linux in general despite the press releases.
As SCO say...
Upon information and belief, Autozone's new Linux based software implemented by IBM featured SCO's shared libraries which had been stripped out of SCO's UNIX based OpenServer by IBM and embedded inside Autozone's Linux implementation in order to continue to allow the continued operation of Autozone's legacy applications. The basis for SCO's belief is the precision and efficiency with which the migration to Linux occurred, which suggests the use of shared libraries to run legacy applications on Linux. Among other things, this was a breach of the Autozone OpenServer License Agreement for use of SCO software beyond the scope of the license.
They claim IBM made moves to shift Autozone away from Linux, when SCO originally attempted to move autozone to linux themselves
They also claim that SCO shared libraries MUST be being used, because of the efficiency with which this changeover occurred. They don't get it, that they're not indispensible, and Autozone's systems did not rely largely on SCO specific features according to the guy who converted autozone's systems, who posted as such on groklaw here. The relevant parts of his post are:
As to the claim that SCO's shared libraries were a necessary part of the port: false. No SCO libraries were involved in the porting activity.
As to the claim that IBM induced us to transition to Linux: false. It was, in fact, SCO's activities that 'greased the skids' and allowed the business case for using Linux to be made more easily. That is a story long in the telling; perhaps I'll share it another day.
I bet SCO keep insisting this is a generic copyright/linux issue, as they infer by claiming "AutoZone violated SCO's UNIX copyrights by running versions of the Linux operating system that contain code, structure, sequence and/or organization from SCO's proprietary UNIX System V code in violation of SCO's copyrights." and don't stress that it's a unique situation with regards to claims an existing customer switched to linux all too easily so must have both used linux and used SCO code in ways they weren't allowed to under their old contract
SCO is appearing like a jealous partner who just can't bear the thought that they're not the entire world to their clients, and are playing the stalking game, and running around town spreading rumours about infidelity. Nothing more, nothing less.
...for fun and profit. I hope those of you considering startups are paying very close attention to SCO's revolutionary example. One day all business will be like this!
Autozone? This is way out of the typical "tech sphere"; I would have expected suits against other tech companies.
Now SCO is going to provoke the wrath of the automotive industry and enthusiasts; an entire new group of people to learn to hate SCO.
Don't blame Durga. I voted for Centauri.
Here is an interesting GrokLaw post from the man at AutoZone who helped them transition from UnixWare to Linux, blowing apart most of these claims.
Bearing in mind that this post is over 2 weeks old, you'd think someone at SCO would have noticed that their claims are basically debunked.
PS : SCO quarterly losses up to $2.25 million for fiscal Q1. Ouch.
Athletic Scholarships to universities make as much sense as academic scholarships to sports teams.
In the second quarter of 2001, despite the Autozone OpenServer License Agreement with SCO, upon information and belief, IBM finally successfully induced Autozone to cease using the SCO software and to use Linux with IBM's version of UNIX. Autozone ultimately decided not to pay SCO the annual fee to continue to maintain the SCO products and, upon information and belief, with the encouragement of IBM, began the efforts required for conversion to Linux.
Sounds like SCO is whining because someone dropped their old, obsolescent Unix. So if I trade in a Chevy for a Ford, GM can sue me if I still have payments left on my loan?
And this:
The basis for SCO's belief is the precision and efficiency with which the migration to Linux occurred, which suggests the use of shared libraries to run legacy applications on Linux.
In other words, we at SCO are too dumb to make Linux work, so IBM had to steal our stuff to make their solution work.
Autozone is one of the few companies doing well right now... They do not need our assistance... YET...
Your best assistance would be to go to http://finance.yahoo.com under the stock symbol AZO. Go to the messageboards and reassure the stock holders reading the messageboard there that this is just part of SCO's continuing practice and the lawsuit should be taken lightly.
LINDON, Utah, Mar 3, 2004 /PRNewswire-FirstCall via COMTEX/ -- The SCO Group, Inc. (SCOX, Trade), owner of the UNIX operating system and a leading provider of UNIX-based solutions, today reported revenue of $11,392,000 for the quarter ended January 31, 2004. In the comparable quarter of the prior year, the Company generated revenue of $13,540,000. Revenue for the first quarter of fiscal 2004 was in line with the Company's expectations, and was comprised of $11,372,000 from UNIX products and services and $20,000 from SCOsource initiatives.
For the first quarter of fiscal year 2004, the Company reported a net loss applicable to common stockholders of $2,253,000, or $0.16 per diluted common share. The Company reported a net loss applicable to common stockholders of $724,000, or $0.06 per diluted common share, in the comparable quarter of the prior year. The net loss applicable to common stockholders for the first quarter of fiscal year 2004 was reduced by $3,624,000 of income resulting from the change in fair value of the derivative associated with the Company's previously issued Series A Convertible Preferred Stock. The loss from operations for the first quarter of fiscal year 2004 was $5,169,000 compared to a loss of $738,000 for the comparable quarter in the prior year. The loss from operations for the first quarter of fiscal year 2004 includes costs of $3,440,000 related to the Company's SCOsource licensing initiatives. These initiatives had not yet commenced in the comparable quarter of the prior year.
"Our revenue and results of operations for the first quarter were consistent with our expectations," said Darl McBride, President and CEO. "In coming quarters, we will continue to expand our SCOsource initiatives, with an ongoing campaign to defend and protect SCO's intellectual property assets, which will include continued end-user lawsuits and negotiations regarding intellectual property licenses. At the same time, we are committed to supporting our extensive UNIX customer base and leveraging our UNIX business for future growth opportunities. Over time, these two efforts are expected to yield positive long-term results for our stockholders."
Financial Outlook
The following financial outlook reflects expected contributions from the Company's two business lines, SCOsource and UNIX products and services. These statements are forward looking and actual results may differ materially. See the discussion of certain risks and uncertainties related to this financial outlook at the end of this release under "Forward-Looking Statements."
For its second fiscal quarter ending April 30, 2004, the Company currently expects total revenue to be in the range of $10,000,000 to $14,000,000. Revenue from the Company's SCOsource initiatives remains difficult to predict in the short-term due to the nature of these licensing transactions and the variability of the timing of revenue recognition. However, the Company anticipates revenue from its SCOsource initiatives will increase in future periods.
Operating expenses relating to the Company's UNIX business for the next three quarters are anticipated to decrease from the first quarter of fiscal year 2004 and comparable quarters of the prior year as the Company's worldwide operations continue to become more efficient. Expenses associated with SCOsource initiatives for the next three quarters are expected to remain consistent with expenses incurred in the first quarter of fiscal year 2004 as the Company continues its legal strategy to enforce and protect its UNIX intellectual property.
Conference Call
As previously announced, the Company will host a conference call at 11:00 a.m. EST today, March 3, 2004, to discuss its first quarter 2004 results. To participate in the teleconference, please call (800) 818-5264 or (913) 981-4910, confirmation code 141144, approximately five minutes prior to the time stated abo
Being from Memphis, I am well aware how supportive AutoZone folks are of Linux, as many AutoZone techs are members of GOLUM.
I hope AutoZone countersues them into the ground in a most genteel, southernly manner.
Now off for my morning bowl of hot grits.
No, Vern. They just let him in.
The day after I get a job offer from AutoZone, they get sued by SCO. Great. Just fuckin' great.
- Give a man a fire and he's warm for a day, but set him on fire and he's warm for the rest of his life.
From their press release, it seems like the AutoZone suit is not particularly related to "SCO IP in Linux," but to some SCO libraries that AutoZone may or may not have used it improperly.
But it does not matter. Could we discuss AutoZone tomorrow, please?
This is only a distraction from a bleak quarterly report. A rather blantantly obvious diversion. And Timothy, you should know better than this. This story should have been titled "SCO losses double for Q1 2004," or something like that. You should not be helping SCO manipulate the press.
For those of you that have been in an autozone, you notice they have the dumb terminals at the parts counter. If you notice this dumb terminal runs a text based interface where you pu tin the year, car make, model, engine size, etc to look up parts. I was in an Autozone once and the server for the dumb terminals happened to lock up. This was 2 or 3 years ago when it happened. I watched the dumb terminal display as it rebooted and came up with some version of redhat (or another distro, I don't really remember too well) and had kernel 2.3 on it.
Responding to the other replies of this article, just because a company doesn't run Linux on their web server to the world, doesn't mean they don't use Linux for other things.
Does the name Pavlov ring a bell?
In a positive way for a change. I'm going to go out and buy a new set of plugs, a filter and a case of oil right now.
It's nice to be able to add someone to the "support them" list instead of the Boycott list, like EV1.
Hang Tight, AZ. You've just gained a mess of geek support.
Apparently their strategy is to sue their own former and defecting customers. This is a worst-case scenario for SCO customers. Autozone was cited in the complaint against IBM as an example of a licensed Openserver client whom had been lured away to the Linux dark side by IBM, If you know of anyone who is considering signing their company into any SCO contract of any sort, especially an "intellectual property license", THIS SHOULD SERVE AS A WARNING OF WHAT TO EXPECT. All SCO appears to be offering is a license to be sued, and here's the proof.
Jim Greer had a good comment on groklaw a few weeks ago about Autozone and the details of their linux transition.
--From a GrokLaw.net post--
I know Mr. Greer, although not well, as I was hired at the time of his leaving.
Everything he said is verifiably true.
I am still employed by said company, and there is very little truth in SCOs
statement at all. I am one of the ones who helped engineer the method by which
we moved store systems over to Linux, and *I* was almost solely responsible for
it happening as quickly as it did.
We did not, and do not, employ IBM for assisstance with Linux. We do not use a
distribution from IBM, nor have we in the past. The only company who has given
us Linux "services" is RedHat, and that was a support agreement which
did us no good, since they were unable to help us with the migration (they
basically told us that what we wanted to do was impossible). The speed and
efficiency with which Linux was deployed was a direct result of J.Greers work,
followed by the work that myself and a few others did.
By the way, I have patented the method of walking whereby you place one foot in
front of the other.
Anyone walking from now on, is using a derivative work of mine, and you owe me
money by not properly licensing my system of locomotion from me. Also, you
cannot teach anyone else to walk, either by example or description.
Kiss my a$$ SCO.
They wanted someone: (a) large enough to have $, (b) large enough to get noticed, (c) with a documented relationship with IBM, (d) AND a documented relationship with SCO but (e) non-technical enough so that they are more easily intimidated.
(c) is important so that they can have something concrete to tie it in to IBM. (d) is important so that they can always try the breach of contract claim if the IP dispute is dismissed. Keeping the breach claim around gives them extra time to try to keep the case around.
With (e) I think their effort here is to pick a technologically weak company with shareholders who have less of a technical education. This allows them to file, the AutoZone shareholders see the suit, panic (because they have less of a technical background than, say, RedHat) and hope tha AZ will settle quickly to make the suit go away.
I don't think it will work, but I can see the logic for picking this particular target for their thug-like tactics.
I would expect something to distinguish the second target so that they couldn't consolidate the two cases.
Lowe's runs CDE on their terminals. They have them locked down pretty tight too - my wife works in their main corporate office, and we got to play with one at one of their retail stores recently.
In fact, the funny thing is that the CEO of my company is an E&Y alumni - he said that he knows a lot of the people over at Lowes and we'll just say they aren't the brightest of the bunch. From what I have seen of a lot of their internal ops, I would have to agree.
And I think I'll just check this post anonymously button...
I'm beginning to wonder in all this... does SCO own part of Groklaw? Why else would they be feeding them such juicy stories all the time?! ;-)
I can just see it in the courtroom:
AutoZone: How do you know what we are running?
SCO: Ummmm
AutoZone: Shall I repeat?
SCO: Umm....Magic?
-Charlie
(Note: I know that isn't exactly what Nmap is for, but I thought it was funny and topical)
(Note2: Isn't is sad that disclaimers like this must exist on Slashdot for the sarcasm impared?)
SCO is going to do a lot to promote linux by
spotlighting companies that use it. My boss will
never again be able to say "no serious company
trusts kiddie software like Linux for anything
critical"
-- Programming with boost is like building a house with lego. It's a cool but I wouldn't want to live in it
You see, I was a Sr. Technical Advisor at AutoZone... I initiated AutoZone's transition to Linux and I directed the port of their existing store software base to Linux. I personally ported all of AutoZone's internal software libraries for use under Linux
:-P
I see. Mr. Greer, meet Mr. Subpoena. Mr. Subpoena, Mr. Greer.
It was, in fact, SCO's activities that 'greased the skids' and allowed the business case for using Linux to be made more easily. That is a story long in the telling; perhaps I'll share it another day.
Yeah, yeah...tell it to the judge, Jim.
Hi!
There are a couple of reasons to sue AutoZone. Neither have much to do with AutoZone's tech savvy or their understanding of the different *nix kernels. They're both about business.
Let's talk microeconomics
The cost of any good is measured in currency and utility. Put simply, you'll buy a product if a) it contains what you want, and b) you want it badly enough. That's why people routinely pay $1.09 in a convenience store for bottles of water--they realize that the water is worth pennies (at best), but the convenience of the bottle (and the refrigeration) make the purchase worthwhile. Similarly, utility can be expressed as "reputation," "quality," "resale value," and similar terms. The reason you drive a Honda, rather than a substantially less-expensive Chrysler, is the utility cost of the car. Key point: utility is a significant factor in the price of a good.
The point of this lawsuit isn't to punish AutoZone themselves. It is to raise the utility cost of using Linux in the eyes of other businesses. Probably the single biggest utility cost that managers evaluate is risk. The great marketplace advantage of Linux is that a company can download a copy for free. (They could care less about "free as in speech." They're only interested in "free as in beer.") Microsoft has argued that Linux has a higher TCO--which is effectively asserting a utility cost. SCO is now raising another kind of utility cost: the likelihood of being sued.
The impact will be substantial, and immediate: auto parts retailers run thousands of POS systems. Any company using a Unix-based POS system (and there are tens of thousands of them across the U.S.) who has even been contemplating moving to a Linux-based system is having meetings this morning to assure senior management (or just try to assure senior management) that SCO is bluffing. This afternoon those same senior managers will be talking to lawyers, who will likely tell them that while SCO probably is bluffing, SCO can bluff in court for a long time, and who wants to be lawsuit #2? The effect of this lawsuit is to dramatically raise the ultimate cost of any Linux-based solution.
The other reason: making SCO look more attractive to IBM
Remember that SCO is primarily focused on litigation with IBM. SCO claims that IBM is the reason that Unix code "leaked" into Linux--many observers in the financial markets believe that SCO is really angling to get bought by IBM in a new dot-com form of greenmail. IBM was involved in developing AutoZone's new POS system--but evidently did not indemnify AutoZone against claims of infringement (a common practice in licensing these kinds of systems). AutoZone has liability insurance to cover this kind of claim (any company does). But that coverage almost certainly requires that the insurance company have the "free and unfettered right to conduct a defense". Because the suit is based on actions by IBM, the insurance company will instantly seek to force IBM to indemnify AutoZone. If IBM declines, the insurance company will sue IBM on AutoZone's behalf. That instantly creates a bunch of costs (legal costs, outside counsel costs, etc.) for IBM. And, since it's likely that IBM's own insurors will respond to the claim from AutoZone's insurors, sooner or later somebody will say, "hey--it's cheaper to just buy these jerks out." Which is precisely what SCO wants.
This isn't about free software.
Darl and his investors aren't doing this out of a noble belief in the goodness of their cause--or due to a bad case of technomegalomania. They're doing it because they expect an significant return on their investment. They use a legal claim that has enough merit to at least get them into court, and they leverage that claim to make enough of a nuisance that IBM buys them out at a premium. They make a couple of million, and move on. It's about money.
I work for one of AutoZone's competitors (of sorts...we do more wholesale than retail business).
I'm largely a counterpart to Mr. Greer from AutoZone.
We use an ASP-type approach. All of our software is text-based, with our primary servers running in our datacenter, with a large frame-relay network for connectivity. Each and everyone of our stores has a Linux system sitting in it, handling the terminals, printers, desktop (Mozilla, OpenOffice, etc.), and back-office networking.
Our application servers in our datacenter still run on SCO, with Sybase running under W2K (at our vendor's request, at the time).
We're looking at doing the same thing as AutoZone sometime soon--a port to Linux server-side as well, moving to our app servers running Linux, and our database under Linux as well.
Here's one for hoping AutoZone pulls this one off right! The last thing I need is someone here getting into a panic over this crap!
The first rule of Linux is... you do not talk about Linux.
The second rule of Linux is... you DO NOT talk about Linux!!!
Third rule of Linux: when SCO yells "stop", goes limp, taps out, the fight is over.
This comment on GrokLaw speaks for itself:
Supplemental No. 8: AutoZone claims are false
Authored by: jbgreer on Wednesday, February 18 2004 @ 10:00 AM EST
I don't know whether to be pleased or angry at SCO's assertion that IBM must have assisted AutoZone's transition to Linux due to the "precision and efficiency with which the migration occurred". You see, I was a Sr. Technical Advisor at AutoZone, where I was an employee for over 10 years. During my tenure, I participated and led in the design, development and maintenance of many of AutoZone's store systems. More importantly, I initiated AutoZone's transition to Linux and I directed the port of their existing store software base to Linux. I personally ported all of AutoZone's internal software libraries for use under Linux. I personally developed the rules by which other AutoZone developers should make changes to their code to support both Linux and SCO's OpenServer product. I believe at one point I had as many as 35 AutoZone developers performing porting work for me, much of which was trivial, given that our code did not generally rely on SCO specific features and that the more technologically sophisticated portions of our code tended to reside in our libraries. The developers were also responsible for testing their individual applications under both SCO and Linux; I supplemented this activity by performing builds of the entire AutoZone store software base on my desktop, which I had converted to Linux.
As to the claim that SCO's shared libraries were a necessary part of the port: false. No SCO libraries were involved in the porting activity.
As to the claim that IBM induced us to transition to Linux: false. It was, in fact, SCO's activities that 'greased the skids' and allowed the business case for using Linux to be made more easily. That is a story long in the telling; perhaps I'll share it another day.
One should remember the Linux business environment that existed at the time the AutoZone transition began. Several vendors - the original Caldera Linux distribution company, Red Hat, and Linuxcare - were offering support for enterprise installations of Linux. In fact, Bryan Sparks, then CEO of Caldera, flew to Memphis and met with me during my evaluation of the various distribution and support offerings. I also met and talked briefly with Dave Sifry of Linuxcare during the 1999 Linux Expo. AutoZone settled on Red Hat chiefly because of my familiarity with their distribution and the ease with which AutoZone could negotiate a support agreement with them.
I must add that SCO was eventually made aware of AutoZone's transition to Linux. They responded by offering to assist AutoZone in the porting activity. By the time of their offer, AutoZone had already completed the initial porting activity and had already installed a Linux-based version of their store system in several stores.
Finally, I'll add that I was for a time a member of SCO's Customer Advisory Board. As such, I believe I have some useful insights as to why SCO lost AutoZone's and several other large accounts' business.
Regards, Jim Greer
Rule number one - if you're going to make an example of a company for your petty little war, don't pick the company that will be selling you brake pads and brake lines next month:
Clerk : Will that be all, sir? Just this replacement brake master cylinder?
Darl : Yes, thank you.
Clerk : May I have your name, sir?
Darl : Darl McBride
Clerk : [typing] Oh... Uh huh... Actually this isn't the right part sir. We do happen to have this special one for you right here, which is EXACTLY what you need.
Darl : Good. Because I really want my brakes to work well.
Clerk : Oh yes sir, this will really do the trick.
On our next episode of "You Picked the Wrong Target", SCO's legal team picks Allied Colonoscope Corporation to make their next example.
And in two weeks on a very special edition of "Wrong Target", Darl suffers a heart attack and discovers and mutters the immortal line "I didn't know defibrillators ran on Linux".
Unix is huge in the automotive software industry. Most part store cataloging systems use it not only on the backend servers, but the terminals as well. Autozone, Hi-Lo/O'Reilly's, NAPA, Pep Boys all at one point used this type of a setup. Firestone also used it during the 90's when I worked for them, but I don't know what they are running now.
If SCO filed this suit solely looking for a suitor to buy them out, they picked a good one here. Owning the rights to the system that literally every major parts house uses would give them a huge push over the top in the industry.
They obviously chose AutoZone because their terminals are clearly visible by customers. I wouldn't be a bit suprised if they go after Lowe's or Home Depot next. Those companies also run linux GUIs and customers can see the X terminals (and 5250 emulators) as they walk around the store.
Don't think that a small group of dedicated individuals can't change the world. It's the only thing that ever has.
According to Netcraft, Jessie James' company, West Coast Choppers, does, in fact, use Linux.
It's all fun and games until someone loses the key to the handcuffs.
There are several important doctrines in Mormonism that make such wielding of "IP" distasteful as well, such as the idea that all truth and knowledge comes from one source: the Savior Jesus Christ. By extension, it is somewhat blasphemous to claim exclusive ownership of ideas. Darl's land-grab for all of Unix is in direct conflict with this doctrine (that alone is not grounds for discipline, but his actions certainly could be).
I'd also like to note that excommunication in the Mormon Church does not condemn a person to hell for all of eternity. Excommunication is a means of 1) helping the excommunicated repent by dealing with the consequences of their misdeeds and 2) making sure the name of the Church of Jesus Christ is not sullied by those misdeeds, especially when carried out under the guise of faith (as I think Darl keeps alluding to in his self-righteous crusade to "save" capitalism from Linux).
What that means is that once Darl gets excommunicated, he could be readmitted back into the Church through baptism, if he repents, which in Mormonism entails changing his ways and abandoning his sins (not just confessing them). So his readmittance might be contingent on making amends to the Linux community, reimbursing those businesses he hurt through his deception and lies, etc.
No, the "court of public opinion" instead wears a green robe with dollar signs embroidered on it.
The Judge, if he / she is worth 10 cents of what it cost to go to law school, will consider the facts, not "the court of public opinion."
Absolutely true, but the damage to be done by public opinion is not in the courts, but rather in the IT spending budgets. A shutdown of spending on Linux due to misperception of the facts is nearly as deadly as SCO winning their suit against IBM.
GreyPoopon
--
Why is it I can write insightful comments but can't come up with a clever signature?
No, the "court of public opinion" instead wears a green robe with dollar signs embroidered on it.
Actually, that would be Rod Roddy. former announcer for The Price Is Right. He was always a little flamboyant with his clothes.
--You will rephrase your request for me to go to hell. Goto statements are not acceptable programming constructs
Since SCO licenses are reallly expensive, why not create a small--and relatively inexpensive--company that will assist you in your move off of SCO and/or help you install Linux in a way that doesn't violate any of SCO's IP?
Seems like there's a fortune to be made there.
[Posted anonymously to avoid karma whoring]
Supplemental No. 8: AutoZone claims are false
Authored by: jbgreer on Wednesday, February 18 2004 @ 10:00 AM EST
I don't know whether to be pleased or angry at SCO's assertion that IBM must have assisted AutoZone's transition to Linux due to the "precision and efficiency with which the migration occurred". You see, I was a Sr. Technical Advisor at AutoZone, where I was an employee for over 10 years. During my tenure, I participated and led in the design, development and maintenance of many of AutoZone's store systems. More importantly, I initiated AutoZone's transition to Linux and I directed the port of their existing store software base to Linux. I personally ported all of AutoZone's internal software libraries for use under Linux. I personally developed the rules by which other AutoZone developers should make changes to their code to support both Linux and SCO's OpenServer product. I believe at one point I had as many as 35 AutoZone developers performing porting work for me, much of which was trivial, given that our code did not generally rely on SCO specific features and that the more technologically sophisticated portions of our code tended to reside in our libraries. The developers were also responsible for testing their individual applications under both SCO and Linux; I supplemented this activity by performing builds of the entire AutoZone store software base on my desktop, which I had converted to Linux.
As to the claim that SCO's shared libraries were a necessary part of the port: false. No SCO libraries were involved in the porting activity.
As to the claim that IBM induced us to transition to Linux: false. It was, in fact, SCO's activities that 'greased the skids' and allowed the business case for using Linux to be made more easily. That is a story long in the telling; perhaps I'll share it another day.
One should remember the Linux business environment that existed at the time the AutoZone transition began. Several vendors - the original Caldera Linux distribution company, Red Hat, and Linuxcare - were offering support for enterprise installations of Linux. In fact, Bryan Sparks, then CEO of Caldera, flew to Memphis and met with me during my evaluation of the various distribution and support offerings. I also met and talked briefly with Dave Sifry of Linuxcare during the 1999 Linux Expo. AutoZone settled on Red Hat chiefly because of my familiarity with their distribution and the ease with which AutoZone could negotiate a support agreement with them.
I must add that SCO was eventually made aware of AutoZone's transition to Linux. They responded by offering to assist AutoZone in the porting activity. By the time of their offer, AutoZone had already completed the initial porting activity and had already installed a Linux-based version of their store system in several stores.
Finally, I'll add that I was for a time a member of SCO's Customer Advisory Board. As such, I believe I have some useful insights as to why SCO lost AutoZone's and several other large accounts' business.
Regards, Jim Greer
My sister was an expert witness on an embezzlement case. The Judge prot em acting as binding arbiter admitted that he did not Know how to turn on a computer
The judge could not understand how she could retrieve data from a computer when the files were "deleted". My sister explained that information was kept in multiple files, and the just "deleting a file is like taking the tabs off the folder, but the files are still there".
The judge said "How do I know you're not just making that up?" and decided for the embezzler.
O.J.Simpson lost the "court of public opinion" and he is still walking around a free man.
Yeh, he's free, but remeber how O.J. Simpson used to be do lots of television commercials for major corporations at one time? Now he's basically shunned by everyone. I don't think that's the future free software supporters are hoping for for Linux.
...this one "to be filed against Daimler-Chrysler, alleging that they are infringing SCO's copyright by using code relating to 'core operating system functionality' of SCO System 5."...
In other news, Darl McBride, CEO of SCO, was unexpectedly killed yesterday when his vehicle's braking system inexplicably malfunctioned on I-40 yesterday...
May we never see th
Tired of not being able to read the best resource on this whole fiasco.
If you do link, please also link to their paypal account link.
Maybe if 1 out of 1000 of you slashdotters who hit groklaw and see it got hosed will go back when it is up and donate a couple bucks, they can add a server or two.
TIA,
Dave
(BTW, I've donated already, twice)
My favourite parts:
.... If It happened within the last 12 hours, I wouldn't be aware of it.... next question!"
Some guy: "Sooner or later this case will be decided upon by a court, and what will happen if at the end of all this it turns out you are wrong? there will be a lot of angry customers. Will you refund their money?"
Darl: "Well, errrr, we wo... umm, the way I see it is that, errr, well, "
and:
Some person: "Can you comment on the outstanding lawsuit against you"
Darl: "There are currently no lawsuits against SCO..."
Some Person: "One sec.... Australian company.... called CyberNight/Night... I have the information here."
Darl: "uhhh, ermm, ahhh, ermm
Frylock: That's not a toy!
Master Shake: You say that about everything you own. You should own toys. They're fun.
...as posted on the Yahoo SCOX board by stdsoft0... (link below)
.16.
.27 per share.
t io n=m&board=1600684464&tid=cald&sid=1600684464&mid=1 01762
Announced results are simply lies. SCO has ALWAYS announced Pro Forma results to the public in the past. Today, they conveniently elected to announce GAAP results.
-
Make no mistake, on a Pro Forma basis SCO lost 0.43 per share, not
-
Anybody else notice that SCO is conveniently parading the GAAP numbers? They are saying nothing about Pro Forma results. Why? Because Pro Forma EPS results are much worse than the (0.16) GAAP numbers. The GAAP results take into account the one-time addition of $3.76MM in income due to derivative accounting on the PIPE deal. The deal was restructured to eliminate this from the Income Statement. As it should be, SCO will not record any future benefit from a falling stock price.
Meanwhile, Pro Forma results cannot include this income, which means that SCO actually lost another
Just another thing for the SEC to look at.
-
http://finance.messages.yahoo.com/bbs?.mm=FN&ac
BWAHHH! The call was freakin' BRUTAL on SCO. Let me see if I can recap the Q&A
Q1: So, what's the basis for the AutoZone suit? I read the guy who did the conversion says IBM wasn't involved, nor did they use any of your code. [This was on Groklaw]
A: Third party sites are really just shills for IBM. But sorry, Wells [judge in the IBM case] told us not to get into specifics. This is about our IP though blah blah protectrightscakes. We'll leave it for the courtroom.
Q2 [Skiba]: Is the $3.4 mil you spent on legal expenses expected to cover the new suits too?
A: Yes
Q3 [Boston Globe]: So what does the Daimler suit have to do with Linux?
A: It's actually about them not answering the letter we sent them ordering them to state they're not illegally running any of our stuff, as they should of done, since we had a contract.
Follow Up Q: So, this doesn't have anything to do with Linux per se?
A: Well, we don't have any proof, but they haven't said that they're NOT infringing, so we'll sue and see what happens.
Q4: Why AutoZone and Daimler?
A: AZ's using our IP and DC hasn't answered our letter.
Q5 [E-Week]: Clarify on AutoZone... is it about the conversion libraries?
A: It's an issue, but it's not the core of the copyright claim.
Q6 [Computerworld]: So what happens if companies continue to not pay?
A: We'll sue them too.
FUQ: Will you return the money if you lose the relevant cases, and it's found that you have no IP rights in Linux?
A: We revealed some code last summer and Linux people admitted our code was erroneously in Linux. We're very confident that infringement is occuring. [Totally ducks the question]
Q7: So you're not actually claiming any infringement on Daimler?
A: No.
Q8: Don't these two new suits hinge on you winning vs. Novell to show who actually owns the IP?
A: No, because we own the IP. We have a filed copyright for it.
Q9: Are you planning to take this litigation strategy abroad?
A: Yes, we're looking into Asia and Europe right now.
Q10 [Investors Business Daily]: Aren't you afraid of sending the message you're going after your own customers first? When are you going to sue Linux users who AREN'T your customers?
A: AutoZone and Daimler aren't CURRENT SCO customers, they haven't paid us for a while. But they're still bound by our licenses and contracts, so we're suing them.
Q11: How's this timeline for the new cases going to be affected by the IBM and Novell cases?
A: It's impossible to predict the future, neither of these are relevant to the IBM case, and the Daimler suit is s astate case, so it will proceed more quickly.
Q12: Any upcoming suits in the UK, say in the next few months?
A: Not going to discuss that today. We're working on IP enforcement in Europe and Japan, but they're a bit behind.
FUQ: Can you comment on the Australian case? [A group called CyberKnights have filed complaints with the Australian CCC (like the FTC in the US) that's similar to the RedHat v. SCO suit].
A: Nobody's suing us in Australia.
FUQ: You're not familiar with CyberKnights?
A: No.
Q13: So we've seen SCOsource have one customer [EV1]. How do you count that revenue?
A: As we receive the money. Some are one time, some are over time. EV1 is paying over time, but we can't go into specifics.
Q14: You said before the Novell suit has no bearing on these cases, but it seems like it has a lot of bearing on any copyright suit.
A: Well, they said they had it, then backed off, then came back. We've always said the copyright is ours.
FUQ: But both of you have registered the copyright. Don't you have to prove you own it?
A: That's for the court to decide.
FUQ: Why's you file in Nevada for AutoZone?
A: That's where they are.
FUQ: Back to the bit about suing ex-/customers, don't you think that'll scare off potential customers?
A: Our current customers love us, they're cheering us on for protecting their rights.
FUQ: I mean FUTURE customers.
A:
Here is a bittorrent of a mp3 of the call today from SCO at http://sco.penguinman.com
(Anon post for whore-avoidance)
OUR TAKE
SCO Digs a Deeper Hole
By Seth Jayson
March 3, 2004
Hey, if you're not making money the old-fashioned way, you might as well see what you can get through lawsuits. That seems to be the primary strategy these days at UNIX software provider SCO Group (Nasdaq: SCOX).
The trouble is, the company's litigious attempts at jump starting revenue cost a lot more than they bring back. This morning's first-quarter earnings provide a revealing glimpse at this poorly executed strategy.
For those who need a brief recap, SCO appears to own a version of UNIX that it claims has been duplicated, at least in part, in the open-source operating system Linux. For months now, the company has been threatening to sue anyone who uses Linux without paying SCO a license fee. Verified targets have so far have included IBM (NYSE: IBM) and Novell (Nasdaq: NOVL), which build and support Linux enterprise software.
In response to these shakedowns, a band of technology companies including other heavy-hitters like Intel (Nasdaq: INTC), Dell (Nasdaq: Dell), Red Hat (Nasdaq: RHAT) and Hewlett-Packard (NYSE: HPQ) formed a legal defense fund.
For the first quarter of fiscal 2004, revenues dropped 16% to $11.4 million. Losses totaled $2.3 million, or $0.16 per share, more than twice the $0.06 per-share loss from the period before.
But it gets worse. The red ink was tempered by a one-time benefit of $3.8 million related to a "change in fair value" of the derivative associated with its series A convertible preferred stock. Without this credit, the loss on operations would have amounted to over $0.37 per share. (Now we know why the maxim, "Earnings are an opinion." makes sense.)
It's my opinion that SCO is doing everything wrong. In addition to the horrific, self-inflicted damage to its reputation, the licensing-lawsuit strategy is delivering a one-two punch to SCO's bottom line. Efforts to license Linux cost SCO $3.4 million in Q1. That's right, one-third of total revenue was wiped out. The payback? $20,000. That's not a typo. I know guys who make that much mowing lawns for a summer. Moreover, the balance sheet already currently lists $8 million in liabilities to legal firms. That number is likely to increase with the firm's new lawsuit against AutoZone (NYSE: AZO).
With declining revenues, increasing losses, plus an expensive and damaging litigation policy, SCO looks like one of the best short candidates I've seen in a while.
Got Linux questions? Consult the experts in the Fool's Linux User's Group.
Fool contributor Seth Jayson wonders how much SCO would charge him for a Linux license on his home-built PCs. He has no stake in any of the companies mentioned here.