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SCO Files for Chapter 11 Bankruptcy

Posted by Zonk on from the a-true-catastrophy dept.

Can you say "the SCO, the" in German? writes "Trading of SCO's stock has been halted on news that SCO has filed for Chapter 11 Bankruptcy. This move just so happens to fall on the eve of SCO's trial with Novell. One would think that their prior boasts were mostly bluster, that they believe they have almost no chance of prevailing at trial, and that they're now desperate to protect their executives from SCO's creditors while seeking yet another delay. From the release: 'The SCO Group intends to maintain all normal business operations throughout the bankruptcy proceedings. Subject to court approval, SCO and its subsidiaries will use the cash flow from their consolidated operations to meet their capital needs during the reorganization process. "We want to assure our customers and partners that they can continue to rely on SCO products, support and services for their business critical operations," said Darl McBride, President and CEO, The SCO Group. "Chapter 11 reorganization provides the Company with an opportunity to protect its assets during this time while focusing on building our future plans."'"

4 of 421 comments (clear)

  1. Re:Stock plummetage by jenkin+sear · · Score: 5, Informative

    Actually, it plummeted as the insiders and people with inside knowledge traded out- trading is halted as soon as chapter 11 is filed. It might be interesting to see who actually sold today in the minutes prior to the announcement. The SEC has been known to take a close look at that in the past.

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    What a strange bird is the pelican, his beak can hold more than his belly can.
  2. Re:w00t!!!! by Slicebo · · Score: 5, Informative

    The "red dress" reference pertains to a comment that Groklaw's PJ made a long time ago, saying she was looking forward to putting on her red dress and partying when SCO loses their case in court.

    I'm afraid a "black dress" for wearing to the upcoming SCO funeral will be more useful now.

  3. Re:Dear Darl, by Desert+Raven · · Score: 5, Informative

    The problem with this theory is that Novell is not a creditor.

    The court ruled that the money *belongs* to Novell. That's a far different legal issue than SCO owing money to Novell.

    It's like a burglar trying to claim bankruptcy in order to keep the stuff he stole. Since the stuff isn't actually his (and in this case has been declared so in a court of law), bankruptcy doesn't protect it.

  4. Re:Sad, sad news by TubeSteak · · Score: 5, Informative

    They are literally filing for bankruptcy and assuring their customers that they are fine and can rely on them at the same time... AT THE SAME TIME! Ummm... maybe you don't understand what Chapter 11 bankruptcy proceedings are. It's a reorganization of the company, not a dissolution.

    That isn't to say that SCO is safe, but news that they're filing for bankruptcy doesn't really mean anything.

    You want an example of companies that go bankrupt while maintaining operations?
    See: US Airline Industry
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