Slashdot Mirror
SCO's Finances, Legal Case Take Hits
geomon writes "This afternoon, SCO will host a conference call where they will present '04 third quarter financial data. The news isn't expected to be comforting to SCO investors as they are coming up a bit short; earnings and dividends will take a substantial hit. The only bright spot for the company is the settlement with BayStar, a deal that will leave most of the cash they received from the investment house in the hands of SCO management, if only for a short time." Reader ak_hepcat writes "Groklaw has posted the text for the latest IBM memorandum in its case against SCO. In a nutshell, IBM accuses SCO of not only wrangling the legal process to keep delaying the eventual resolution of this case, but they go so far as to pull the curtain away and show that this table never had any legs to begin with. I'm no marksman, but I can tell when something is full of holes."
In a nutshell, IBM accuses SCO of not only wrangling the legal process to keep delaying the eventual resolution of this case, but they go so far as to pull the curtain away and show that this table never had any legs to begin with.
Seems William Shatner should have been their spokesman, IIRC as a kid he cut the legs off his parents dining table and should have some experience here...
"It's more doomed than we thought, Scotty, beam us up NOW!"
A feeling of having made the same mistake before: Deja Foobar
that and Darryl's shiny metal ass.
An Indian-American Hindu committed to non-violent thought/speech/action alarmed by the global explosion of radical Islam
Reading SCO news is like watching someone fall out of a tree and hitting every branch on the way down.
It used to amuse me, now it annoys me. I'm just waiting for them to shrivel up and go away.
Seems like slashdot pundits have been predicting the imminent death of SCO and it's legal claims for the past year. They keep coming up with cute analogies (i.e. table without legs) but I'm wondering if Slashdot is not really giving us an objective viewpoint here.
that at the upcoming press conference SCO will announce that IBM does not exist.
This will dissipate any investors' fears pertaining to the validity of the lawsuit.
I'm just guessing here, but if I'm right his is very bad for SCO. It would mean that Novell keeps the UNIX copyrights, the IBM case is limited to the Monterey contract and the Red Hat case can proceed with a finding on record that SCO has been blowing smoke about its UNIX IP.
===== Murphy's Law is recursive. =====
I'm no marksman, but I can tell when something is full of holes.
Thats good, because SCO investors must have the hole spotting ability of a depressed star-gazing lemming...
My hard-earned experience with Wall Street is that it really doesn't give a rat's patootie about the past (earnings report), but rather pays attention to the forecast for the next quarter and year.
Watch what they hint at and see the reaction in their stock price next week after everyone gets back from Summer vacation and the real traders start to move things en masse.
slashdot: A failed experiment.
and that doesn't inspire confidence either. It probably isn't reaching too far to say that SCO ain't long for this world.
here you go
ahh the beauty of the Internet
and the stock is currently trading at $3.80, 6mo performance is definatly a sell
Their lawyers can also be sanctioned for submitting arguments they knew had no chance at all* of winning. Rule 11, anyone?
*N.B.: Before you get worried about closing the courthouse doors to legitimate complaints, that rule is used even less than it probably should be, and only in cases where the lawyer submits a claim (s)he knows or should have known is either misleading, false, or ridiculously frivolous (fails the laugh test).
Stop learning! Only you can prevent esoterrorism.
As much as I side with IBM here, it does seem a bit ironic to see IBM complaining about a competitor "perpetuating fear, uncertainty and doubt."
This is company that hasn't produced a competitive product in years. And now that everybody see's that there may not be much merit to their IP claims on linux, their license collections will die off too. Their only hope is for a Microsoft to keep funding them to wage this proxy war against linux. Just wait until their are no more good proxies for Microsoft to fund, that's when we'll likely see them jump in the ring flush with a new patent portfolio to swing around.
"There's no set architecture in Linux. All roads lead to madness" -Microsoft
I think that was actually Homer Simpson, but don't recall the episode or why, but the
should echo investor sentiments rather accurately."Me, I invest in beer at least I get something for my money."
A feeling of having made the same mistake before: Deja Foobar
"In response to IBM's discovery requests and the Court's orders, SCO did not [give] (and still has not [given]) any competent evidence that IBM's Linux activities infringe SCO's alleged copyrights (or even that SCO owns valid copyrights)"
Its a fun read. I'll be really suprised if they don't get a summary judgement in their favor.
It really underlines the brilliance of IBMs legal team, because now they can point back to all the shit SCO said, show clearly that they are either unable or unwilling to back it up with fact, and hit them with big ugly damages just for saying it.
ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
... all that time ago when SCO started this:
1. Did they really think they had something?
2. Was it a hope for IBM et al to buy them out and save a failing Company?
3. Did M$ really engineer all this anyway?
Whatever, but the last point is can a court, on whatever decision is reached now, actually stem the tide against this sort of action by large $$$$/££££ in the bank Companies deliberately trying to destroy a free (and perhaps better system), against an otherwise 'couldn't care less to who uses my code' attitude open source movement in the courts?
IBM has money to oppose. What if they didn't and couldn't fight back for OSS? Who could fight the monopolies then?
The next fight is these silly patents. I think that will be BIG trouble for all free people, let allow coders.
No no no, it's just pining for the fjords. Just don't ask it for evidence... SCOs stun easily.
Your CPU is not doing anything else, at least do something.
The take is that IBM's request for Summary Judgement that no SCO copyrighted code exist in Linux will be granted.
Novel is invited so as to protect their interest in the Copyrighted material. Most likely Novel is the owner of any copyrighted material not SCO (OldSCO rather ie Caldera)since it was nver transfered in writing, as required.
Help fight continental drift.
Any yes I *do* read slashdot. Check my ID.
(though its the only time that might have happened that I would have been grateful for a *lower* number).
The question being...
How many geeks work for SCO?
And how many moderate on Slashdot?
The secret of success is honesty and fair dealing. If you can fake those, you've got it made. (Marx)
Is it legal to look at a guy/gals resume, see that they worked for SCO after the 'suits started and exclude them from consideration for hire for that reason alone?
OT I know, but just wondering.
Please do not rely on a litigant's motion papers to prove a point. These are documents made to persuade a judge and as such are nearly advertisements. Wishful thinking aside, until the judge GRANTS IBM's motion nothing is settled. I am sure SCO's motions look pretty too - - it is not as if both sides lack for decent lawyers. In most cases anyway a judge will let the jury decide. Summary judgements are rarely granted unless discovery has proven a FACTUAL point which does not need to litigated. Defendents always file these motions which are sometimes useful in limiting the scope of the lawsuit but rarely result in a complete win.
To the press SCO offered litter
While leaving the stockholders bitter
If Darl hasn't cooked
SCO's books
Their position must be in the shitter.
see, this is only one high profile case of infringment. regaurdless if it is false or not, it is hell to go through, for EITHER company.
note: microsoft is patenting damn near everything that they can, from the User Interface, how software is behaving, hell even shit that they haven't created yet.
imagine when somebody tries to continue to reverse engineer their stuff.. only the world's most pollitically powerful comany's wrath would be hell
but imagine what their dogs for lawyers would and could do to you. this is going to be a long, drawn out hell.. mark my words
results
If you mosey on over to this Groklaw article, you'll see that Judge Kimball appears to be fixin' to have a three-way showdown--IBM & Novell vs. SCO.
If you've read the legal briefs, you should know by now that both Novell & IBM have hammered on SCO's counsel for asserting some rather convenient but inconsistant things before the judge. In other words, they assert whatever is most beneficial to their case--leaving SCO with a few more arguements, but no consistant case. While they might be able to make that slide a bit better when they're talking as two separate cases, saying different things about the two different cases while discussing them in front of the same judge can't help them any--they'll have pick a side of some of those fences they're sitting on and stick with it.
Problem is, IBM & Novell have them trapped in a narrow pass, effectively, due to some good lawyering on both of their sides. They're going to have to face the music one way or another--if they take one way out of that pass they're in, IBM will get them, whereas Novell is coming down the other side. In other words, SCO is being attacked on two fronts with no retreat, and IBM is now a bit pissed off with SCO's lawyers after the last few tricks (such as citing a Westlaw headnote without attribution, using a priviledge IBM document as an exhibit in clear violation of one of the discovery agreements with IBM, and a few other things I can't remember right now...). Marbux and AllParadox on Groklaw posted on SCO's malfeasance better than I can, and both of those two are lawyers, though they still put up a few disclaimers about not taking what they say as legal advice.
Anyhow, unless this is a mistake by the court in having them all meet up at the same in front of the same judge (possible, but doubtful), you can expect SCO to be routed--their lawyers seem harried, disorganized and ready to have their asses handed to them just as soon as IBM & Novell are done with them.
Mark your calendars, folks--if this is what it looks like, SCO is going to have one hell of a time getting out of this with anything but a ruling which further weakens them. Even if SCO has an ace up their sleeves, I'm not sure they can be holding any better than aces & eights--the dead man's hand.
Maybe they posted it ahead of time knowing someone would post the results in the comments, like this: http://biz.yahoo.com/prnews/040831/latu104_1.html.
Summary: Revenue is $11,025,000 which is way down from 3Q03 revenues of $20,055,000. The SCOsource revenues are $667,000 vs. $7,280,000 in 3Q03. But, the SCOsource revenue was only $11,000 in 2Q04.
Strangely enough, the stock is up 6 cents in after hours trading.
~Idarubicin
Almost without exception, the lead stories have links. These links are mostly to Groklaw, who themselves give links to all the relevant info. Thus, the info is there. As for the tone, I hardly think you could expect *any* publication to be without bias. For example, Forbes.com always reports in favour of Microsoft and SCO - no-one seems to be doing anything about that. What is worse, is that they don't even link data that could be useful to dissenters! Furthermore, ./ is more about the comments. This is what makes it so different to (say) Forbes - you are entitled to post an opinion, and correct what you consider to be distorted facts.
Anyone who only reads the head stories in /., is not really a /. reader, n'est-ce pas?
So, is Slashdot opinionated? Yeah, perhaps. Biased? No, I don't really think you have a case here.
There was a small company named SCO,
Whose chief did kvetch and crow,
"My code they have stolen,"
"I've got proof in my colon!"
But such proof he never would show.
Lameness filter go away, come again another day.
DNA just wants to be free...
The parent post has been broght to you by the Grammer Nazi Association of America (GNAA).
Are you Pedantic?
Are you an Asshole?
Are you a Pendatic Asshole?
Then you should join the GNAA (Grammer Nazi Association of America)!
Erotic is when you use a feather. Exotic is when you use the whole chicken.
15 million in 5 quarters? At least someone is making money off of SCO.
From the conference call: And SCO is now allocating $31M for the future of their lawsuit. That means they're investing $31M + the $15M already spent. The attorneys have agreed to accept this $31M amount, plus 33% of any settlement (up from 25%), and that's the max that SCO will have to play for their legal counsel. Supposedly the law firms will then by motivated by the final settlement. That leaves $12 for operations.
SCO also say that the lawsuits are progressing as expected, and they look forward to a jury trial in ~14 months.
They were happy to talk about their better Unix revenue, but people only want to ask questions about the lawsuit.
Alright, here are some brief summaries of conversations during the conference call. (I have too much free time but it's interesting to witness a train wreck).
Caller asks SCO what they can do to protect their shareholders from what may be bad legal advice.
Response is SCO obtained the best firm available for the best legal advice available.
Caller asks would you seek a second opinion from a new firm like you would seek a second opinion from a medical doctor?
Response is anyone with these questions likely has not read all material in front of the courts and they would be unable to generate a conclusion because the paperwork is confidential.
Caller asks what would it take to buy SCO with the poison pill?
The board would need to set a fair price.
Caller asks how many people are employed by SCO.
At the end of the quarter, SCO has 230 people.
Caller asks since beginning on this legal crusade, how much has been paid for legal representation?
Just over $15 million for all law firms for the prior 5 quarters.
SCO currently has $43M in cash. Plans on paying $31M in fees - not sure if this is some baystar thing or legal fee.
Can you summarize the responses from the court that have been positive?
March 6th, Judge said SCO has shown good faith in its discovery process. Ordered IBM to deliver executives emails.
April 19th, SCO received good information from IBM and has been working through that.
Despite judge orders, IBM has not completely fulfilled the order to deliver the information request on March 6th.
Novell case, motion filed to dismiss, motion was denied. A new motion to dismiss was issued and SCO looking forward to dealing with that.
Autozone case, case was stayed but you get 90 days of discovery. SCO is currently going through that process.
Character case that IBM is trying to do of SCO's legacy AT&T contracts is misguided.
Additional hearing will be held on September 14th and 15th.
Caller asks is SCO replacing cash payments to lawyers with sliding scale contingency payments?
Yes. In a certain sense, the long term obligation depends on judgment and settlement amounts.
While this just a motion, IBM seems confident and is calling it like it sees it. Most of /. would agree.
Well, there's spam egg sausage and spam, that's not got much spam in it.
That's been grinding along. Ben Glisan (former Enron treasurer) is in prison. (Inmate #20293-179, Bastrop Federal Correctional Institution). He gave up the Fastows. Lea Fastow is in prison. (Inmate # 20290-179, Houston Federal Detention Center). Andrew Fastow (former Enron CFO) pled guilty and is going to jail soon. He gave up Skilling and Lay (former Enron CEOs). They've been indicted and are out on bail.
It's just like taking down an organized crime operation. Which Enron was. One step at a time, until the guy at the top goes down.
A recording of the conference call is available here:
http://www.users.cloud9.net/~terrapn/
the legal presumption is that the copyrights still reside with the original owner: in this case, Novell.
Yes, but I don't think judges often go beyond the minimum needed to decide a case. And, in order to decide the slander of title all the judge needs to rule is that it is questionable whether SCO owns the copyrights, and therefore reasonable and without malice that Novell made the statements that they made.
IANAL
The just thought of a problem though. SCO could now file a contract case regarding who owns the SVR4 copyrights. This could have bad repercussions, in the sense that SCO could get delays in other cases while the new one just gets started.
The problem is if the copyrights are in question. I don't think that decides the RedHat case, but might result in dismissal without prejudice or a continued stay with an injunction telling SCO they must discontinue interfering with RedHats business until the copyright case is decided.
Autozone woudl probably continue to be stayed. And, there may even be the possibility that IBM gets stayed. Although if IBM doesn't request the stay, I am not sure SCO could without severe embarassment.
SCO: "Sorry judge, we submitted this lawsuit too soon. We need to clear up who really owns the copyrights to SVR4. Could we get a stay until the Novell case is decided?"
Maybe they could get a stay on a couple of the counterclaims, and continue with the rest since they characterize their claims as contract claims. Either way whiel SCO submitting a copyright case against Novell would clear everything up eventually, (probably in Novell's favor). I could result in SCO getting more time to bluster.
Dastardly
So, they have to pull their Linux distro, which they've probably already done by now. No biggy to them (though they'd have to start negotiating royalties to be able to support their existing customers)
But, consider this - it's not just IBM's copyrighted works they lose the rights to. Based on that precedent, they could soon be hit with a massive class action lawsuit by thousands of people who have written software under the GPL, demanding that they stop distributing it with UnixWare, as they have no license (and possibly pay damages for copyright violation, if they have any money left by then). Imagine - a commercial UNIX, where if you want any GPL'ed software, you'll have to install it from source yourself, and track and deploy your own updates. Their UNIX would go from a more or less enterprise class OS, to something not quite as useful as DOS overnight.
What is the robbing of a bank, compared to the founding of a bank? -- Bertolt Brecht
For those who want to listen to the conference call recording, here it is...
RealPlayer:d emand/040831cald.ra&proto=rtsp
http://play.rbn.com/?url=shareholder/shareholder/
Windows Media Player:e holder/wmdemand/040831cald.asf&proto=mms?mswmext=. asx
http://play.rbn.com/play.asx?url=shareholder/shar
>>Gupta quoted tiny bits out of context and rearranged them to deceptively make linux and sysv look similar, when the sections quoted aren't similar at all.
Would that be falsifying evidence? Isn't that a very serious crime?
"SCO's present assertion...that SCO has not had sufficient time to perform the requisite analyses of Linux and the UNIX code it claims to have copyrighted, and that such analyses could take 25,000 man-years, obviously rings hollow. It appears that SCO's litigation strategy now is simply to seek delay for delay's sake. SCO, by its own admission, has already performed the analyses it needed, but has not come forward with any evidence that would a create genuine issue of material fact as to copyright infringement in this case. In this situation, summary judgment is appropriate; SCO should not be given additional time to perform analyses it admits it has already performed and have apparently (despite SCO's public claims) turned up nothing" (emphasis added).
OTOH maybe the judge should grant a stay until SCO has completed the 25,000 man-years of analyses it says it needs. A staff of 100 could finish the job in 250 years; surely BayStar can keep pouring money in for that long?
This is not my sandwich.
Also note that there have been no insider trades since this past April, when the stock started it's nosedive to it's current bargain-basement levels. Here's the proof. Prior to April 7, Thomas Raimondi sold off $1,196,507 of stock. Another insider, Reginald Charles Broughton, during the period between 20 Jun 03 and 17 Sep 03, while the stock was on the rise and nearing the top of the bubble, sold off $3,425,458 worth of stock, most of it trading at in excess of $12/share and even as high as $20/share. Pump and dump? You bet ya. I can't wait to see what happens when the SEC goes public with their investigation.
I've no idea why you think license purhaces don't count, since it's a pretty standard money laundering technique. But we've also learned that Microsoft initiated the Baystar inventment and while they claimed that there was no financial involvement from Microsoft, a white paper on Baystar's own website lists Micosoft and Vulcan ventures as two of their major investors. It has also come out that two of the other "licensees" (SUN & EV1) were influenced by Microsoft in their descision to purchase licenses (CA, the other major licensee, was given the license as part of a settlement agreement).
That pretty much covers all of SCO's funding in this venture. If you run down the standard checklist:
- Microsoft has the means to fund SCO's FUD
- Microsoft has the motive to fund SCO's FUD
- Microsoft has the oportunity to fund SCO's FUD
- To the extent that there is any evidence at all about the source of SCO's funding, in each case the ultimate source appears to be Microsoft.
That's why people seem to state it as an accepted fact; while it may not be proven it would certainly be the smart way to bet.-- MarkusQ
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