Microsoft Shown Involved with Baystar and SCO

baryon351 writes "Back a few years ago, when SCO looked like it was hemorrhaging cash, a surprise investment came out of the blue from venture capitalists Baystar. They invested $20 million in SCO and aided their anti-Linux cause, enabling McBride & co. to continue with (now shown incorrect) claims of line-by-line code copying of SCO IP in Linux. Now one of IBM's submissions to the court reveals Microsoft was behind it after all. Baystar's manager says about Microsoft's Richard Emerson: 'Mr. Emerson and I discussed a variety of investment structures wherein Microsoft would backstop, or guarantee in some way, Baystar's investment ... Microsoft assured me that it would in some way guarantee BayStar's investment in SCO.' Despite the denials about their involvement, Microsoft helped SCO continue this charade — and on top of that halted all contact with Baystar after the investment, reneging on their guarantee."

Comments

Surprise

[Mazin07]

I could almost stereotype Microsoft...

Re:Surprise

[Anonymous Coward]

Microsoft doesn't give a shit about OSX. Microsoft is scared of Google.

Re:Surprise

[PhoenixK7]

Actually, I think Microsoft is scared of everyone. It seems like they feel the need to compete with everyone after they've brought an interesting product to market and they decide they can make some money there. Now one might say that they've decided they can do a better job in that market spot, but they never really do a better job. The X-Box 360 may or may not be an exception to this, but I really wish, for the sake of everyone that uses their products and everyone else that needs to deal with them they they'll stop trying to run everyone else into the ground and just make a core set of products the best they can be. There's no innovation, they kill everything they make through design by committee.

Re:Surprise

[kfg]

Actually, I think Microsoft is scared of everyone.

Well of course they are. Fear is the motivation for being a bully.

KFG

Re:Surprise

[tacocat]

You are thinking about two different models of corporate survival.

I find it easier to think of these things in terms of biological and evolutionary survival techniques.

One option in surviving as a corporate body in the economic ecosystem is to do the Darwinian thing by evolving to become the most efficient and effective at what your niche is. An example of this is the shark. One of the finest hunting species known. Similarly the wild cats.

Another alternative is various molds. They emit a gas which is highly toxic to all other forms of competing mold, thereby carving out a space within which there can be no competition because of the toxic nature of the air. Another exeptional example is Caulerpa taxifolia which is a seaweed growing across the mediterranean seafloor at the expense of all other life. The animals cannot eat is for it too is toxic.

As a corporation, one much protect it's ecosystem space or territory to remove competition. One method is to continually adapt in a highy evolutionary manner, trying to address all the environmental conditions that arise by responding to the liabilities and assets that present themselves. The other methodology is the lock down the environment through aggressive tactics to kill the opposition rather then out-hunt it by means of USPTO litigation, copyright litigation, litagation in general, and supporting litigation of others where it is advantageous. And then there's marketing. How many studies are there showing Windows is superiour to everything else? The price of Coke/Pepsi products is >50% marketing expenses.

Re:Surprise

[Burz]

Thank you for that primer on Social Darwinism. Whatever your take on it, such a theory does not justify underhanded and anti-competitive behavior by a monopoly.

Re:Surprise

[ultranova]

Evolution requires differential reproductive success and corporations don't reproduce.

Actually, they do. Corporations sometimes split parts of their business functions into new corporations to "focus on their core competencies" or something like that. Monopolies can also be split by courts. Then there's the model where a number of people working in a corporation leave to find a new one - the existence of the new corporation is a direct result of these people working together in the old corporation, so I'd say that the old corporation has an effect on what the new corporation will be like.

And, of course, the only reason why evolution requires reproduction is that living beings have a hard time of changing their phenotype once their genotype has been deployed; for a corporation it is relatively easy, since it does not really exist except in the imagination of people and is thus not bound by laws of physics.

Re:Surprise

[Sj0]

Science is meant to describe an event. It is the job of morality and ethics to determine whether an action is just.

Re:Surprise

[Monsuco]

Actually, I think Microsoft is scared of everyone.

Linux strikes an especially sensitive area. Their core buisness, Windows OS is being challenged by a free, technologically superior alternative. They are well aware of the fact that if they lose Windows on the desktop, they then probably loose Office, MSN and the IE7 Search, Windows Live One Care, Internet Explorer, MS Exchange, some of the Xbox 360's media features, Windows Media DRM, Zune, Virtual PC, Windows Server, .NET, DirectX, their PC gaming division, Visual Basic, and all their other Windows software that compeates with other stuff. Most of their other stuff either only works on Windows, or there are a few that are ported to Mac, but they get most of their buisness on the Win ports (such as office). Plus most Mac users only want things like MS Office because it eases the transition to OSX. MS gets most of their money through Windows, so they have a lot to loose. Plus, when you have 90% of the market, well, there is no way to go but down. That is what SCO is for, to try to scare people away from this new challenger. MS uses SCO in addition to their deals with hardware vendors as a form of containment.

Oh no! It can't be!

[A beautiful mind]

I just can't believe such vile and shameful accusations against Microsoft! Surely no company would sink this deep to protect it's monopoly. Oh wait...

Re:Oh no! It can't be!

[TubeSteak]

Yea, but in the end, MS got SCOwned.

Suspicions Confirmed

[xs650]

Suspicions confirmed.

I remember MS butt-boys flaming me for suggesting MS was financing this a long time ago.

Re:Suspicions Confirmed

[KarmaMB84]

According to the article, Microsoft didn't fund anything. They allegedly (no contract, no proof?) guaranteed BayStar's investment in SCO and backed out. I find it hilarious that someone took a for-profit corporation at their word with no contract (if they had one, I'd imagine they'd sue for breach of contract).

Re:Suspicions Confirmed

[Aim Here]

"According to the article, Microsoft didn't fund anything. "

You mean the article doesn't say that Microsoft funded anything. At almost the same time as the Baystar deal, Microsoft and Sun both paid SCO large amounts, totalling something like $20-30 million between them, apparently for Unix licenses of some kind. Sun obviously needed a Unix license to put out Solaris. What Microsoft did with whatever it paid SCO $millions for, seems a tad unclear.

(further to that, SCO's court filings in Utah relating to what these two amounts were for directly contradicted their own filings to the SEC, and now Novell has filed a motion for partial summary judgement claiming that 95% of this money is owed to them under the Asset Purchase Agreement that sold the Unix business to the Santa Cruz Operation. SCO only has about $10 million in cash and cash equivalents so if they win, it's game over for SCO).

Re:Suspicions Confirmed

[HiThere]

It's not at all obvious that Sun needed a Unix license. It's never been shown that they actually licensed anything that they didn't already have clear rights to. Possibly they needed to do it in order to put out "OpenSolaris", but that hasn't been demonstrated.

If someone wants to assert that Sun paid the money to finance SCO's lawsuit, I've neither seen nor heard of any specific evidence that contradicts that assertion. Of course, supporting that assertion is another matter. The only evidence to support it is, frankly, speculative. One could equally well assert that SCO was blackmailing Sun, and this was the payoff. No evidence.

All we know is that Sun paid the money, and the timing was, frankly, suspicious. Suspicion isn't proof.

Re:Suspicions Confirmed

[hpa]

According to the article, Microsoft didn't fund anything. They allegedly (no contract, no proof?) guaranteed BayStar's investment in SCO and backed out. I find it hilarious that someone took a for-profit corporation at their word with no contract (if they had one, I'd imagine they'd sue for breach of contract).

It's probably worth noting that individual traders in financial services companies often have a shocking degree of independence, to the point that the lack of oversight has to be classified as negligent on the part of the company. There are several centuries-old banks which have gone under due to the irresponsible trades by a single trader who managed to aquire star status on the inside, usually by getting away with a couple of extremely risky trades in the first place.

It's not at all impossible that someone star-strucked by Microsoft and tempted by the potential of getting a risk-free deal may have accepted some bogus handwaving that they don't want a paper trail or whatnot, or simply might have been too intimidated to push.

March 2004:A plea for relief from Microsoft

[NZheretic]

Wednesday, March 10, 2004 A plea for relief from Microsoft's escalating anti-competitive tactics.

An open letter to antitrust, competition, consumer and trade practice monitoring agency officials worldwide.

The role of trade practice and antitrust legislation is to provide the consumer with protection from abusive business practices and monopolies. In one of the most serous cases of monopolization in the information technology industry, the agencies charged with protecting the competitive process and the consumer have utterly failed to stem the offending corporation's anti-competitive practices.

The Microsoft corporation has been under continuous investigation by antitrust policing agencies since 1989. Despite this scrutiny, the Microsoft corporation, using covert and overt anti-competitive business tactics, has maintained an unabated campaign against alternatives to Microsoft Windows operating system platforms and Microsoft applications.

For years the Microsoft corporation has earned around 70% to 80% net profit from sales of its operating systems and application software. Only in areas like Thailand where Linux on the desktop has just begun to gain a foothold has Microsoft stated that it will release versions of its operating system platform and application software at a lower price to Original Equipment Manufactures (OEMs) and retail consumers than is available in the rest of the modern world. Consumers benefit where real competition exists.

The world desktop operating system market remains predominantly monopolized by Microsoft. Over the last decade, Microsoft continued to lever its desktop platform monopoly to the point where it now holds a dominant position worldwide in the application office suite and web browser software markets. On its own, the current USA Department Of Justice (DOJ) settlement with the Microsoft corporation has failed to bring about any restoration of serous competition to the desktop operating system market. Microsoft continues to use similar anti-competitive business tactics in an attempt to monopolize the digital media player and the desktop services server markets. Competing vendors increasingly find that they can no longer compete with Microsoft if they limit themselves to only the traditional closed source model of software development.

In the last six years information technology vendors have adopted techniques and resources from two existing movements geared toward the construction of software. The newer open source movement, represented by the non-profit Open Source Initiative (OSI) corporation, emphasizes the licensing of software in a manner which encourages its collaborative development in an open environment. The older free software movement, represented by the non-profit Free Software Foundation (FSF), focuses on the ethical issues surrounding the licensing of software. The free software movement emphasizes freedoms which are often taken for granted outside of the field of software: the freedom to use, study how something works, improve or adapt it and redistribute.

The Free Software Foundation offers two software license schemes which are compatible with their own goals and those of the Open Source Initiative: The GNU General Public License (GPL) and the GNU Library General Public License (LGPL). Essentially, the GPL and LGPL licenses grant the recipient extra rights than that granted by copyright law. Both licenses insure that a contributer or distributer of a GPL or LGPL licensed work may not further impede downstream recipients the rights granted by the same license. Many developing software in an open source manner have realized that this benefit offered by the GPL and LGPL licenses outweigh any potential losses. The licensing also insures that no contributing or distributing vendor or group of vendors could potentially monopolize the market, insuring that real market competition dictates price. Just as the automotive indus

Surpise?

[NMerriam]

Microsoft screwed over a business partner by agreeing to do something and then backing out after the partner upheld their end of the deal? Wow, is it Sunday again already?

I have to admit to being curious why any company would get involved in a business deal with Microsoft. I can understand being their customer, but willingly partnering with a company that stabs partners in the back on a regular basis just seems crazy. "Yes, just step over those corpses on the way into the conference room -- pay no attention to the ghost of Stacker rattling those noisey chains, I assure you this is a win-win situation!"

Re:Surpise?

[Anonymous Coward]

I have to admit to being curious why any company would get involved in a business deal with Microsoft.

Well, it's simple. Because they are the 800-pound gorilla. If you try to compete with them they will crush you immediately, but partnering with them can be very lucrative-- right up to the time when they decide that the niche you occupy is now "strategic" to them, and they bend you over and shove a pinecone up your ass.

Re:Surpise?

[Marcos Eliziario]

Because they have no other choice once microsoft decides to look at them?

Re:Surpise?

[killjoe]

I frequently wonder the same thing and I have come to the following conclusion.

Hunter S Thompson once described a politician running for the president to a moose during mating season. Normally moose are wily creatures. If you go hunting for them they are hard to spot, they are supremely aware of their environment, they can hear and smell you coming from miles away. Once a moose is in mating season though all that flies out the window. The second they hear or smell anything that even resembles a female moose they will charge towards her like... well a crazed moose!. They will crash throught the bush making all kinds of noise, they will leave chunks of their flesh on trees that they broke on the way. They just don't care, just want that female!.

Just as a politician becomes like a crazed moose when running for the presidency a CEO becomes like a crazed mooose when somebody waves money in their face. Once they see that money mind blanks of all other thoughts. Their memory, ethics, morals, bodily functions, wife, children, the planet, shareholders, employees, everything else gets driven out and is replaced with the smell of that money.

When MS waves money in front of a CEO the CEO stops thinking. He completely disregards the dozens of times MS has backstabbed it's partners and thinks to himself "it won't happen to me, those other CEOs were stupid, I am smart and handsome and I deserve this".

I don't want to sound negative, it's only human (and mooose) nature. We would all probably act the same way if somebody waved enough money in our faces. Soon all thoughts of right, wrong, morality, history, and diligence would be replaced by the mansion in the hamptons or that DB9 we have been salivating about.

Re:Surpise?

[Hal_Porter]

A 5 ton elephant could take on a 800lb Gorilla I'm sure. But what about a 300lb cat?

Consider. I way 150lbs, so an equivalent feline would weigh 150lbs * ( 300 / 800 ) = 56lbs that's 25kilos

About half the size of this cat here.

So a imposing kitty by all means, but I do't think it could take me down.

Amazingly, Google is unable to find pictures of 56lb cats so that I can estimate their fighting skills, the closest is Katy, a 50lb Russian cat from here

http://www.neatorama.com/2006/05/08/top-15-amazing ly-ginormous-fat-cats/

It seems to me that the size of a cat doesn't increase it's combat effectivness. Indeed a hungry and fit 7kilo cat with quick claws and ninja ambush training would be more of a threat.

Re:Surpise?

[jamstar7]

One thing is quite certain: Microsoft would never be so idiotic as to put their financing of the SCO litigation in writing. We have no idea exactly what was said at the time, but it may be that Microsoft originally actually thought there was a modicum of substance behind SCO's litigation. They might then have been willing to invest it it even more heavily than they did. Perhaps Goldfarb was counting on that.

Or, that by helping out with SCO's FUD, Microsoft would hold onto its advantages. By keeping Linux developers on the defensive, it bought time for Microsoft to keep on doing things the Microsoft way -- way late, way too little, but still way profitable. The upside of it is, it wouldn't be Microsoft spreading the FUD, it would be SCO, which would take a bit of heat off Microsoft. And if SCO could somehow, some way, actually win, even better, as it would force Linux distributions to actually compete in Microsoft's back yard, where they own the ball, the bat, the back yard, and the referees, as well as having options on all the star players.

FWIW, I'm beginning to think that Microsoft purposely let some of its code escape the ranch in order to scream, somewhere down the line, 'All your code are belongs to us. You stole it fourth, fifth, or sixth hand by using that evil Linux code'. Considering that the code haddn't escaped into the wild for decades, it's the only thing that makes sense to me.

We've been saying that for a long time...

[SmoothTom]

...it's nice to finally have some concrete back-up from those directly involved, instead of just having to piece things together from what leaked out around the edges.

No matter if SCO loses as they should, the millions of dollars their phony lawsuits cost others, the doubt they cast over all of 'free' software, and the delays in some companies considering a move to Linux until Vista could finally be made (allegedly) viable, definately helped Microsoft.

Hopefully there will be enough of a tie-in for Microsoft to be pursued for their part in the charade.

--
Tomas

Duh

[Jeffrey Baker]

I knew they were cylons all along. Throw Microsoft out the airlock!

Oh, Baystar? Nevermind.

My firm only uses BSD.

[Anonymous Coward]

I run a hosting and Web services firm. If there's one thing this whole debacle has taught us, it is to avoid dealing with software vendors as much as is possible. Our solution has been to use FreeBSD and NetBSD for our operating system needs. Apache and lighttpd are excellent Web servers. Python is our scripting language of choice.

While we now know that the claims involving the Linux kernel source code origins were likely baseless, there was a point when there was much uncertainty. Thankfully, we avoided that via our use of FreeBSD and NetBSD.

Likewise, we now see that Microsoft had wasted money with these shenanigans, money that could have been used to improve their software products. We would never even consider using their products.

Had we been a UnixWare and OpenServer shop, we'd likely be facing much uncertainty right now.

We have found that using community-developed software is often our safest bet. And best of all, we can contribute back the modifications we make.

Re:My firm only uses BSD.

[ettlz]

And it's not like these rumblings haven't come to haunt BSD before now...

Re:My firm only uses BSD.

[Anonymous Coward]

While I'm not the parent poster, I can understand why people who have been in the industry for a long time would trust SCO.

I do think you should consider how SCO was seen in the 1980s and 1990s. They were basically the only vendor who offered x86 UNIX systems of a decent quality that were suitable for commercial use. In the early 1990s, Linux was still rather immature, and wouldn't become viable until several years down the road. The BSD-based systems were embroiled in a legal dispute with AT&T, which severely hindered their development at the time.

While their offerings look rather meager today, SCO systems were quite advanced for their day. SCO XENIX and SCO UNIX, and later OpenServer and ODT, were actually quite a pleasure to use. If you look at most hardware driver disks from the early to mid 1990s, such as those that came with ISA NICs or modems, you'll likely see SCO UNIX, UnixWare, and OpenServer drivers included.

In short, SCO was widely respected by a great number of system administrators. They were an engineering company at their core, and put out great products. Of course, things did change rapidly in the years leading up to the lawsuits. But many system administrators, some who may very well now be managers, had a lot of trust for SCO (or whoever was using the "SCO" name).

Re:My firm only uses BSD.

[toadlife]

"Sorry, but I like retaining the rights to my software, and I want those rights to improve the software.

With the BSD license, you retain the rights to your software and you have the right to improve the software. Perhaps you should go read the BSD license agian?

"Call it a protection against HUMAN GREED."

So taking away certain rights away from those that use your sourcecode is not a form of greed?

"People everyday reap the benefits of GNU software licensing, and fail to make the connection that its the source code and the restrictions to force people to PLAY NICE and not be greedy little thought police wishing to control our lives and wallets because they don't want us to see what the hell the machines are doing with our data."

People every day reap the benefits of BSD software licensing, and fail to make the connection that it the source code and the lack of restrictions that allowed such widespread adoption of the things we takes for granted today.

"All in the name of some kind of "intellectual property" B.S."

Without that "Intelectualy property B.S.", the GPL would be nothing more than a plea to the people that download your source code.

"If software is ever going to improve, the leachers have to stop stealing other peoples work, incoporating that work into software and then claim its all theirs and you don't get the source code."

It's also not stealing because the license allows it. Also, the BSD license prohibits claiming that it's 'all yours'.

"AND more importantly, that labor shouldn't be able to be compromised in any way by stealing source code and incorporating it into software we now don't get the source code for, and are stuck with: ALA Micosoft's IP stack for Windows 2000."

The Windows 2000 IP stack was not based on BSD code. If it was, it probably would have performed better.

In the words of Nelson Muntz...

[Foofoobar]

HAHA! Seriously though, this was done while they were still under the antitrust agreement with the Justice Dept. This is in direct violation and if the court shows this, I'd suspect IBM, Redhat, Novell and others to go after Microsoft; worst case, it could be a class action on behalf of all businesses and Linux distros. This coupled with their shaky OS launch should make for an interesting 2007 for Microsoft.

Actually...

[Svartalf]

IBM wouldn't have submitted it unless there was something to back it all up with (This is something
submitted as testimony/evidence in a Civil Trial- IBM is not wont, unlike MS and SCO to fabricate
things for the court (Both of the latter mentioned companies are VERY guilty of that!)...they don't
HAVE to...). A paper trail.

We see glimpses of it floating about on the Internet, if you know where to look. Not as much
of a libel or fiction as you'd like to believe.

Prince iples

[headkase]

Microsoft (and the vast majority of modern corporations) seems to be following Machiavelli's adage of "Men ought either to be well treated or crushed" where MS is in crush mode. IBM seems to be in well-treated mode ;)
There's nothing feel good about it - this is business and unless a government steps in and regulates the industry, well, it's all about the benjamins.

IS it illegal

[aepervius]

I can see a lot of "duh" reaction, and while I agree on the "feigned" shock, I would like to see something more of substance. Is this illegal for MS to do that or not ? IANAL , but it does not seems to be.

I suspect so...

[Svartalf]

IBM wouldn't have fielded this as part of their filings unless they were laying the groundwork
for going after each and every party involved with this charade for it's worth. I'm hoping so
myself- it'd be nice to see all the people responsible for this whole lame affair being pilloried
for their efforts.

Re:It's a shame ...

[jimicus]

If you're going to try libelling someone to cover your backside, perhaps it would be a good idea if:

A: That someone isn't Microsoft, with all their lawyers.
B: You don't do it in documents which are very likely to end up being used as evidence in a court of law.

Afraid so...

[Svartalf]

This would fall under something prohibited by the Antitrust Acts. Since they have been found to
be an effective monopoly under those acts in a Findings of Fact from a prior Antitrust Trial, with
really no change in the circumstances, they're at violating the law again. (Small surprise that-
with nothing but slaps on the wrist, they really don't have any incentive to NOT do it again and
again, with more flagrant violations of the law being done over time.)

Re:It's a shame ...

[Aim Here]

Except for the fact that Goldfarb was under oath, meaning he goes to jail if he gets caught lying.

Oh, and the documentary evidence that already corroborated this story.

Mike Anderer (the person behind SCO's ludicrous claims that 'spectral analysis' showed that there was lots of Unix code in Linux) was drunk late one night and fired off a stroppy, and semi-literate, email to his paymasters complaining that HE was the person who convinced Microsoft to tell Baystar to pump SCO full of cash, and that he deserved a bonus for it. This email ended up on Eric S Raymond's desk, back when our Eric was the hotline for disgruntled Microsofties with incriminating internal documents to share.

Read all about it here

Being under oath

[www.sorehands.com]

Except for the fact that Goldfarb was under oath, meaning he goes to jail if he gets caught lying.

Even though it is illegal people do commit perjury. In my case against Star Marketing Group they lied under oath in a declaraction. Mason Stedman claimed that it was the only officer in the company and since he was out of town, he did not receive the summons and complaint. If you look at company's web page shows that that is a lie.

In another case, I had a spammer claim that there is no "affiliate program", both their own corporate web page made reference to it.

Even if caught, these liars will not likely be jailed for it -- such a shame.

It has not been proven (yet)

[Anonymous Coward]

Please do not speculate the outcome of a pending trial by statingthe it has been proven. It has not yet been done so and the judge and or jury might disagree with your possible erroneous statement that it has been proven.
I am not a layer but I recon that a sly outfit like SCO could use statements like this as possibly influincing a jury and give grounds for a possible appeal against a verdict that goes against them.
I know that in UK Law making statements in any media like this could put you in contempt of court. The TV, Radio and Press are very careful not to make statement presuming the possible guilt of a person or company before a verdict has been reached.

Re:The court were right about one thing

[X0563511]

If only. You have to admit, outside of the benifits for *nix and friends, a public-domain of EVERY Microsoft product would be a kickass thing. Free and open MS office, all the dev tools, DirectX (practically falling out of the chair thinking of that being completely open), windows itself, and the ENTIRE WINDOWS DRIVER STACK. no more fighting with crappy vendors, ndiswrapper-like functionality for all!

Re:surpise

[Ruie]

I almost fell out my chair from the suprise.

Did the chair fly in the opposite direction ?

Advantages of the SCO lawsuit

[Animats]

The SCO vs. IBM lawsuit has done quite a bit for open source.

• SCO went up against the GPL, and had to back down. Nobody laughs at the GPL any more.
• If someone has to really defend the GPL, it's hard to beat the team of Cravath, Swayne and Moore, the world's leading commercial law firm, funded by IBM, the world's biggest computer company.
• Companies are no longer afraid of legal FUD about open source. That stopped several years ago. Right after SCO threatened big companies, including Goldman Sacks and Damlier-Chrysler, and were laughed off.

The SCO lawsuit has validated open source and the GPL. We don't have to worry about that problem any more.

Re:Advantages of the SCO lawsuit

[bcrowell]

There was never any real doubt about the legal strength of the GPL. It's always been on much firmer ground than a lot of software licenses out there, because it's not a EULA. It's simply a contract that's offered to people, and if they decline the contract, they don't get the extra rights the contract offered them. EULAs are vulnerable to challenges on the ground that they're contracts of adhesion, which are held to a higher legal standard in order to be enforceable.

It's interesting to compare Linux with BSD, though. Basically the reason Linux is an order of magnitude more popular than BSD on the desktop is that BSD suffered a similar legal assault when it was in its infancy. Linux was a grownup by the time SCO tried to steal its lunch money, so it was able to withstand the assault.

One good thing to come out of all of this is that we have two free Un*x clones these days, BSD and Linux, and both of them are known to be very solid legally. Monoculture is bad, and it's a very good thing for the open-source movement that we have friendly competition going between these two systems. The SCO lawsuit's significance isn't that it cleared up any uncertainty about the GPL, because there never was any; it's that it cleared up any uncertainty about the IP status of Linux, and resulted, e.g., in more careful legal auditing of submitted code.

Thats brilliant

[viking80]

At no cost to MS, they fooled baystar into wasting a lot of money on a stupid investment, and all the money went to hassle MS enemy #1.

My 7 year old daughter promises a lollypop to her younger brother if he will go and kick someone she is mad at. When he comes to collect, she tells him "No".

Well done Microsoft, and shame on Baystar for falling for such a cheap plot.

Ob. Futurama

[ElMiguel]

I'm shocked! Shocked! Well, not that shocked.

Re:There's Evidence, and then there's Clear Eviden

[killjoe]

You mean a sworn affidavit in a court of law, at the risk of perjury, in front of a judge and council is not good enough for you.

You almost fell for it...

[penix1]

One of the many reasons SCOG changed names was to cause confusion in the market as well as the court room and it worked based on what you posted (with the exception of your last sentence). The SCO Group != Santa Cruz Operation (SCO). The name changed after they filed as can be seen from http://sco.tuxrocks.com/Docs/IBM/complaint3.06.03. html when they filed as Caldera. The whole idea was to cause as much confusion as possible making their claims seem more plausible. Just keep in mind, the SCO Group exists only for litigation from start to finish.

B.

The paranoia of being on top.

[Kadin2048]

Actually, I think Microsoft is scared of everyone.

Well, yeah. I mean, they're standing atop the marketshare hill -- they have to be scared of everyone. There's no place to go but down; it's not a question of winning anymore, it's a question of hanging on to the top spot for as long as they can. History has shown that such situations don't last forever, but they're going to try and play it for all it's worth. (As anyone in their situation would.) To survive, Microsoft has to constantly be looking for the new competitor that's going to unseat them.

IBM, Kodak, Standard Oil, U.S. Steel -- all of these companies were once the untouchable masters of their respective domains, but all fell from grace eventually. Microsoft knows that it too shall fail eventually, but it's going to prolong it as best it can, and that means they have to be paranoid of everyone and everything that could possibly, at any point in the future, harm their position.

So after this...

[Trogre]

... is anyone still going to buy an XBox 360?

C'mon guys, you crucified Sony for less.

Re:So after this...

[goldspider]

Yep. All those Slashdot readers who were inclined to buy an XBox will suddenly realize that Microsoft doesn't always operate above the bar.

Welcome to Slashdot, Captain Obvious.

Re:So after this...

[erroneus]

I might buy any machine that can be made to run a useful installation of Linux. :)

Re:It's a shame ...

[jimicus]

Is that so?

Nevertheless, if you lie in court you can certainly be done for perjury.

Rich Emerson Corpus

[Stats_for_all]

Baystar's Larry Goldfarb and the Michael Anderer email both identify Rich Emerson as the key Microsoft contact. Goldfarb talks about at "guarantee or backstop" and Anderer spoke of Rich doing a continuing set of 3 to 4 million dollar infusions.

Microsoft issued an relatively unusual press release in mid-September 2003, announcing that Emerson was leaving to "spend more time with his family". The announcement got published in the New York Times, and Emerson's supposed end date was August 31, 2003. He would consult on "complicated transactions".

Emerson's position as "SVP Corporate Development" reporting directly to Steve Ballmer was abolished on his resignation, and the Corp Development division demoted to supervision by the CFO. After a period, Brian Roberts, Emerson's long time deputy was promoted to run the division. Robert's left Microsoft in 2005 to work with Emerson at his new position at Evercore Partners. Roberts and Emerson have been associated since running telecomunications portfolio in the dot-com days at the investment bank Lazard-Freres.

Emerson made political contributions to the Bush re-election campaign in mid-September 2003, and listed his occupation as Microsoft Executive, so his August 2003 resignation is a bit atmospheric or conveniently backdated.

Emerson had been given a 12 Million dollar loan as a signing bonus to MSFT in 2000. A mid-September 2003 proxy noted that he was paying the loan back with vested stock options. The options were underwater, but had a positive Black-Scholes valuation based on their future potential to be profitable. Emerson used this positive valuation to retire the loan on a cash free basis.

Emerson had little public trace through most of 2004, and then acquired a position at Evercore Partners, a mergers and acquisitions investment advisor. Evercore has since IPO'd, and is traded as EVR.

Emerson and a Baystar principal Andrew Farkas were both listed as advisors/investors in a NYC Venture, I-Hatch Partners. A Farkas relative (Younger brother, I believe) is the fund executive. This is good evidence that the Baystar and Emerson relationship had alternative means of communication, and unreturned phone calls from MSFT headquarters should be considered a convenient fiction.

Emerson and deputy Roberts also show up in July 2003 SEC documents as the signatory for the Microsoft investment in IMMR (Immersion) that had patent suits against Sony and MSFT. The MSFT stock investment in IMMR ended the Microsoft portion of the suit (for game controllers) while ensuring the suit against arch-rival Sony would continue. This "investment in a strategic lawsuit" has echoes in the Baystar Pipe deal occuring just months later. We can conclude that the IMMR and SCOX investments are implementations of a similar strategic idea. Sources:
http://news.com.com/2100-1022_3-5079594.html
http://www.sec.gov/Archives/edgar/data/789019/0001 19312503051346/ddef14a.htm
http://query.nytimes.com/gst/fullpage.html?res=950 3E6DB103AF933A1575AC0A9659C8B63
http://www.newsmeat.com/fec/bystate_detail.php?cit y=SEATTLE&st=WA&;last=EMerson&first=RICHARD

Re:New Vocabulary Word.

[meringuoid]

New Vocabulary Word: "Allegedly." It's a good word. I highly recommend it.

Ian Hislop? Is that you?

The GPL is a license, not a contract

[Morgaine]

>> it's not a EULA. It's simply a contract

The FSF begs to differ on the latter.

Prof Eben Moglen is the Free Software Foundation's attorney, and of course is strongly involved in framing the GPL's legal content. And in the detailed article "The GPL Is a License, not a Contract", Prof Moglen says very clearly that:

" The GPL, however, is a true copyright license: a unilateral permission, in which no obligations are reciprocally required by the licensor."

It really doesn't get much clearer than that. Read the whole article though for Pamela Jones' typically detailed explanation. Even some lawyers on Slashdot seem to be getting that point wrong.

Re:surpise

[Khyber]

Better question, did the chair hit Steve Ballmer?

Can't resist...

[Lorkki]

Hunter S Thompson once described a politician running for the president to a moose during mating season.

That must've been some conversation!

Royal Bank of Canada

[hey]

I'd like to know what was up with the Royal Bank of Canada in all this too.
They invested $30M in Baystar.
http://www.linuxinsider.com/story/33529.html

Re:surpise

[Redlazer]

You must be new here.

We always hit Steve Ballmer with a chair.

-Red

It still makes me wonder

[Moraelin]

Disclaimer, I'm not even anti-Windows as such, but still:

1. The model capitalism was based on was #1 not #2. The ideal (19th century-style) capitalism idea is basically that of a market of commodities: all products are interchangeable, and a perfectly informed market decides which one offers the best bang/buck.

It's not just an ideological point of view. The role capitalism was supposed to serve was that of, well, basically the ultimate optimizer. Think, sort of, genetic algorithms. If the market needs X at all, there'll be tens or hundreds of competing entities trying to offer the best X at the best price possible. Each will make their own X1 variation at the best price they can manage, and the market will decide on the variant which fits the demand the best.

That was the strength of the western block over, say, the Soviet Union. That in the time the USSR planners decided always too late on what to produce and how much and in what way, the capitalist market could try a hundred ways and let the market choose the best one. That unless deciding "ok, we'll produce Volgas" which may be right or wrong, you can let a hundred people try a hundred different things, and end up with the Ford T1 model which was better and cheaper for most people.

Letting a corporation compete on how "toxic" they can be instead of competing on raw product merits is subverting that whole idea. It's, in fact, no better than the Soviet system. There too how "toxic" and subversive one could be (e.g., having high placed friends in the Party, or _being_ a party official who can send the opponents to Siberia) was most often what decided which model got produced and what got scrapped. We already know how well that went.

2. I wonder and worry about MS. (Or their managers, before someone accuses me of anthropomorphising... human managers.) Their whole history and practices shows that they're just not playing the same game we expect everyone else to play. And which, again, is the whole foundation of capitalism. Again and again, they seem more interested in just killing as many opponents as they can, as opposed to offering a better product or whatever.

Let me explain that better: it seems not even being toxic for survival reasons, but just being toxic for the hell of killing someone. Regardless of whether it's even a survival advantage or not. MS will even gladly take a huge loss (e.g., their XBox strategy) just to try to put someone else out of business. It's stuff that isn't even a survival advantage (making a loss never is), but just the sheer fun of killing someone just because they can.

Basically it's like watching a football game, where one of the players isn't even as much interested in playing the same game or even winning the game, as such, but just in kneecapping as many opponents as he can. Even winning (or losing) is merely a side-effect of killing or crippling everyone in the other team, rather than the goal and purpose of the exercise.

3. And I seriously worry about -- and am disgusted of -- the current US government's bending over to that kind of behaviour. Yes, that being toxic instead of competitive is an option for MS, is pretty obvious. But why tolerate such an entity? Not only it's condoning a major subversion of the very idea of capitalism, but... for _what_? MS is actually contributing very little to the US economy.

Microsoft is employing a grand total of 71,553 employees in 102 countries and regions as of July 2006. Total. Most of them actually support and sales/marketting and management people, and probably more than half off-shore anyway. Even at the scale of IT jobs, it's a spit in the bucket. Out of _millions_ of IT jobs, even after the exodus to India, we're talking maybe half a percent. At the scale of the economy, a helluva lot less.

So, while, yes, a government's priority should be keeping unemployment in check, MS is a spit in the bucket in that aspect. The effect of MS upon unemployment in the US is negligi

Acronym weirdness

[dbIII]

or that DB9 we have been salivating about.

You would sell your soul for a 9 pin serial plug? Some people have odd fetishes I suppose. Here - have some old computer mice and keep your distance.

problems with being a lawyer

[www.sorehands.com]

I have a major problem preventing me from being a lawyer, dealing with liars. I can't stand liars.

Maybe that is why I am a software engineer, I am used to the truth.

Re:There's Evidence, and then there's Clear Eviden

[wannabgeek]

Say that about Ken Lay's testimony at his trial.

At the risk of being modded off-topic, let me answer this. Ken Lay did not have anything to loose by committing perjury. He was already in deep shit. If he did not commit perjury, he will have to plead guilty to the charges laid - which amounts to the same. I don't think these two are similar.

Re: VC lawyers

[KwKSilver]

I am not a lawyer, and if I were involved in a fender-bender, the last lawyer I'd want is some shyster from a VC firm. I'd want a lawyer with integrity, instead, Mr. Astroturf, P.A. If you went to Groklaw to RTFA, you would have found a link to IBM's memo in pdf format, not "just" a paralegal's (or "just" anyone else's interpretations), Mr Anonymous Arrogant Shyster. Some of those who post on Groklaw are lawyers, only honest ones.

If you went, and didn't see the link to the pdf of IBM's memo, you are incompetent. If you went and found it and checked it out, then you are mis-representing IBM's memo as Pamela Jones' interpretation of the case, which is false (who wants a liar for a lawyer? VCs, I guess.) If you didn't go to check, then you are not only arrogant, but grossly negligent and your VC clients deserve you. So are you (a) incompetent, (b) dishonest, or (c) negligent? Please go volunteer your services to MS and SCO or maybe get into patent law.

By the way, isn't VC treatable with penicillin?

misdirection fud gets modded up Informative

[rs232]

Yet another case of an ms apologist getting modded up.

"It's not at all impossible that someone star-strucked .. may have accepted some bogus handwaving .. or simply might have been too intimidated to push."

"Mr. Emerson and I discussed a variety of investment structures wherein Microsoft would 'backstop,' or guarantee in some way, BayStar's investment.... Microsoft assured me that it would in some way guarantee BayStar's investment in SCO."

That's an agreement between Larry Goldfarb, managing general partner at BayStar and Richard Emerson, senior VP of corporate development at Microsoft and not some bogus irresponsible star-strucked handwaverer.

Re:Suspicions Confirmed (Score:4, Informative)

Re:misdirection fud gets modded up Informative

[alizard]

Not necessarily. Why couldn't the poster be a Baystar apologist? People with money in Baystar who saw the WSJ piece have got to be getting nervous about the people in charge of their investments, and their PR firm either is sending astroturfers every place they can to 'defend' the management or should be fired for being as stupid as their clients. Making a multimillion dollar investment on the basis of a handshake deal with MICROSOFT?