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Tuesday, June 17, 2003
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SCO's Amended Complaint Online
Go to this SCO page, and you can read all the gory details.
Here's the essence of their claim:
"2. Through a series of corporate acquisitions, SCO presently owns all right, title and interest in and to UNIX and UnixWare operating system source code, software and sublicensing agreements, together with copyrights, additional licensing rights in and to UNIX and UnixWare, and claims against all parties breaching such agreements. Through agreements with UNIX vendors, SCO controls the right of all UNIX vendors to use and distribute UNIX. These restrictions on the use and distribution of UNIX are designed to protect the economic value of UNIX.
"3. A variant or clone of UNIX currently exists in the computer marketplace called [base "]Linux.[per thou] Linux is, in material part, based upon UNIX source code and methods, particularly as related to enterprise computing methods found in Linux 2.4.x releases and the current development kernel, Linux 2.5.x. Significantly, Linux is distributed without a licensing fee and without proprietary rights of ownership or confidentiality.
"4. The UNIX software distribution vendors, such as IBM, are contractually and legally prohibited from giving away or disclosing proprietary UNIX source code and methods for external business purposes, such as contributions to the Linux community or otherwise using UNIX for the benefit of others. This prohibition extends to derivative work products that are modifications of, or based on, UNIX System V source code or technology. IBM and certain other UNIX software distributors are violating this prohibition, en masse, as though no prohibition or proprietary restrictions exist at all with respect to the UNIX technology. As a result of IBM[base ']s wholesale disregard of its contractual and legal obligations to SCO, Linux 2.4.x and the development Linux kernel, 2.5.x, are filled with UNIX source code, derivative works and methods. As such, Linux 2.4.x and Linux 2.5.x are unauthorized derivatives of UNIX System V. "
One other interesting bit of news is that the say IBM didn't make them any offers to resolve the situation:
"9. To that end, SCO did everything reasonably in its power to exert a good faith effort to resolve the termination of IBM[base ']s UNIX contract rights. Conversely, during the 100-day period, IBM did not set forth a single proposal or idea for cure."
SCO also answers IBM's affirmative defense about improper venue:
17. Venue is properly situated in this District pursuant to 28 U.S.C. §1391 in that IBM maintains a general business office in this District and a substantial part of the events giving rise to the claims alleged herein occurred in this District.
I think they may find it hard to convince an honest judge of that. What they are saying is that IBM should have to travel to Utah for the case, because they have an office there.
The pejorative bicycle language is gone which tells us that they noticed that went over like a lead balloon and maybe that they found out that it wasn't true. I think these attorneys are not geeks. I know, last time I looked, Boies didn't even use email. His secretary did that for him.
I finally got comments functionality turned on, so, as you read all the details in this complaint, you may notice some other things that aren't accurate, from what you know. If so, either post a comment or email me and I'll post the information you provide, as I can.
An observant reader sent me this, showing, once again, evidence that any identical code and any identical comments could have originated from Caldera employees themselves making contributions to the Linux kernel:
"You might want to check over this post to the linux-ia64 mailing list,starting with one interesting comment, which may most damning of all (https://external-lists.vasoftware.com/archives/linux-ia64/2001-February/001115.html): 'I know some other IA-64 OS uses that mechanism. I'm not sure how much perfermance gain we can get by that in Linux, though.'
"Note that the date of the above is after the take over by Caldera, in which he admits knowing the internal details of 'some other IA-64 OS', given Jun's time at SCO, this could only be the Unixware IA-64 port, Old SCO half of the Monterey Project. Then compare this post of Jun's including the comments http://www.geocrawler.com/archives/3/5312/2001/1/0/5052740/ To this actual part of the Linux kernel http://lxr.linux.no/source/kernel/sched.c?v=2.4.18;a=ia64#L229 "
Of course, SCO recently said their big issue isn't identical code; it's derivative code.
"Those remedial measures, however, seem to point toward some sort of royalty payment, as SCO does not believe that its intellectual property can be easily extracted from Linux. Not only are there lines of SCO's code in Linux, but also derivative products based on SCO intellectual property have been created, Sontag said. Getting all of the protected bits out, assuming SCO's claims are valid, would be a huge chore. 'Our biggest issues are with the derivative code,' he said. 'It would be almost impossible to separate it out.'"
Here is SCO's derivative code claim from the Amended Complaint. Keep in mind that they can claim whatever they like (up to the point of frivolous lawsuit -- there are sanctions for that) but they are making broad claims here, and they will have to prove them to a judge's satisfaction:
21. The UNIX operating system was originally built by Dennis Ritchie, Ken Thompson and other software engineers at AT&T Bell Laboratories. After successful in-house use of the UNIX software, AT&T began to license UNIX as a commercial product for use in enterprise applications by other large companies.
"22. Over the years, AT&T Technologies, Inc., a wholly owned subsidiary of AT&T, and its related companies licensed UNIX for widespread enterprise use. IBM, Hewlett-Packard, Inc. ('HP'), Sun Microsystems, Inc. ('Sun'), Silicon Graphics, Inc. ('SGI') and Sequent became some of the principal United States-based UNIX licensees, among many others.
"23. IBM, HP, Sun, SGI and the other major UNIX vendors each modified UNIX to operate on their own processors. Thus, for example, the operating system known as 'HP-UX' is HP[base ']s version of UNIX. HP-UX is a modification of and derivative work based on UNIX System V source code.
"24. Similarly, the operating system known as Solaris is Sun[base ']s version of UNIX. Solaris is a modification of, and derivative work based on, UNIX System V source code.
"25. SGI[base ']s UNIX-based operating system is known as 'IRIX.' IRIX is a modification of, and derivative work based on, UNIX System V source code.
"26. IBM[base ']s UNIX-based operating system is known as 'AIX.' AIX is a modification of, and derivative work based on, UNIX System V source code.
"27. Sequent[base ']s UNIX-based operating system is known as 'DYNIX/ptx.' DYNIX/ptx is a modification of, and derivative work based on, UNIX System V source code.
"28. The various identified versions of UNIX are sometimes referred to as UNIX 'flavors.' All commercial UNIX 'flavors' in use today are modifications of and derivative works based on the UNIX System V Technology ('System V Technology'). Were it not for UNIX System V, there would be no UNIX technology or derivative works available for IBM and others to copy into Linux.
"29. SCO is the sole and exclusive owner of all Software and Sublicensing Agreements that control use, distribution and sublicensing of UNIX System V and all modifications thereof and derivative works based thereon. SCO is also the sole and exclusive owner of copyrights related to UNIX System V source code and documentation and peripheral code and systems related thereto."
6:06:49 PM 
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Oh, That's Why They Are Saying That
I figured out finally why SCO is making the wild claim about terrorism. It's just legal strategy: They can't revoke an irrevocable, perpetual license unless they can say that IBM violated the contract. (I don't know if they can say it even then, not having read the contract, but this is what SCO is claiming they can do.) It must have been hard to find a violation, so they came up with the idea of saying IBM violated the law, and so in that way, it broke it's contract. Specifically, they are claiming that IBM violated export laws by making multiprocessor operating systems technology available "'for free distribution to anyone in the world,' including residents of Cuba, Iran, Syria, North Korea and Libya, countries to which the United States controls exports. The open-source technology IBM released 'can be used for encryption, scientific research and weapons research,' the suit said. " Shankland has updated his article.
"SCO also detailed one element of technology that it asserts IBM copied, the Remote Copy Update ( RCU ) system, for relieving some memory bottlenecks on multiprocessor servers.
"The amended complaint includes an IBM copyright on the RCU technology that names the an engineer as the author, with work "based on a Dynix/ptx implementation by Paul Mckenney (sic)." Dynix/ptx was Sequent's version of Unix for servers with multiple Intel processors.
"It appears that RCU indeed stems from work in Dynix/ptx. In a paper on his Web site, IBM's Paul McKenney says RCU was included in Dynix/ptx in 1994. And the Linux Scalability Effort's Web site says that RCU patches are "based on original DYNIX/ptx code (released by IBM under GPL)"--the GPL referring to the General Public License that covers Linux. Torvalds accepted RCU into the Linux kernel in October 2002."
The document also attacks Linus Torvalds by name, saying he is to blame and that IBM knew he wasn't doing a good job of keeping proprietary code out of the kernel. Linus just announced he will take a year off from Transmeta to work on the kernel full-time. This is, from a PR point of view, a good thing. Now he will be completely focused on the kernel. I think businesses will be relieved and reassured. It's not hard to figure what kind of work that will be, and I hope he finishes before this case even goes to trial.
Most civil cases of this kind take about 18-30 months to get to trial. With some of IBM's affirmative defenses, I'm guessing it'll take longer. I also believe they will be adding some counterclaims. So even when they arrive at the first day, it'll be a lengthy trial in all likelihood.
Poor Linus. This probably isn't the fun part. 
According to the Boston Globe's Hiawatha Bray, SCO believes damages could add up to $50 billion. McBride is claiming an injunction would mean IBM would no longer be able to provide customer support for any AIX customers.
"In addition, SCO is demanding that IBM halt the sale of Dynix, another version of Unix that is based on SCO software. IBM acquired its Dynix business when it bought Sequent Computer Systems Inc. in 1999. Dynix is a small player in the Unix market, so any threat to its future would have relatively little impact on computer users.
"But AIX is one of the most popular versions of Unix. Research firm Gartner Dataquest estimated that AIX held a 21 percent share of the Unix server market in the first quarter of 2003, putting it second only to Sun Microsystems Inc., whose own version of Unix, called Solaris, leads the industry with a 50 percent share.
"McBride said an injunction would bar IBM from providing product support for any of its AIX customers, but he insisted that any damage to AIX users is the fault of IBM, not SCO.
"'They have the responsibility to step up and resolve this,' he said. 'Our view is that IBM is moving the customers into harm's way.'"
In his dreams IBM will "step up and resolve this."
Ignore what the attorney says in the article about injunctions, by the way. He must have thought that they were asking for a preliminary injunction, which is what you would normally expect them to do. But, as I explained a couple of posts ago, that isn't what they went for. They are asking for a permanent injuntion, which is not immediate relief granted. The judge can't order a permanent injunction until he has heard all the facts, and that means at the end of the trial. A preliminary injunction is what you ask for at the beginning of the trial, to protect your position. Findlaw has a legal dictionary, by Webster's, and you can read the definitions of a preliminary and a permanent injunction here, if you wish to verify. Verify is good.
3:56:21 PM
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IBM: Get Me Outa Here
This Shankland article points to an interesting connection:
"SCO has made no secret in recent months that it hired high-profile attorney David Boies to spearhead its case against IBM, but the company's legal representation in Utah courts is also noteworthy. The company retained Brent O. Hatch and Mark F. James of the law firm Hatch, James & Dodge. Hatch is the son of Sen. Orrin Hatch, R-Utah, a spokesman for SCO confirmed Monday."
Another Hatch connection turns up in this Salt Lake Tribune story from April of 2002, which mentions that Judge Dale A. Kimball, the judge assigned to this case, was sponsored by Hatch.
Cozy. Well, I noticed that IBM has filed an Amended Response on May 20, 2003. (You can read it on SCO's site, but everything except the list of denials is here.) And in it, in their Affirmative Defenses, they list one that says
"Caldera's claim's are improperly venued in this district." That means: this is the wrong venue, or place, to bring this lawsuit. Here is the explanation of venue, from Steven H. Gifis' Law Dictionary, Second Edition:
"VENUE: a neighborhood, a neighboring place; synonymous with 'place of trial'. It refers to the possible or proper place or places for the trial of a suit, as among several places where jurisdiction could be established. See 132 N.W. 2d 304, 308; and 257 F. Supp. 219, 224. 'Jurisdiction deals with the authority of a court to exercise judicial power. Venue deals with the place where that power should be exercised. Jurisdiction over the subject matter cannot be conferred by the parties, and the lack thereof may not be waived. Venue, on the other hand, is bottomed on convenience, and improper venue may be waived.' Green, Civil Procedure 64 (2d ed. 1979). Venue 'is the right of the party sued to have the action brought and heard in a particular judicial district.' 249 A. 2d 916, 918."
Evidently, IBM would like to have this case heard elsewhere.
Here is the introduction to the Amended Complaint and all 9 affirmative defenses:
"In answer to the allegations of the complaint of Caldera Systems, Inc. d/b/a The SCO Group ("Caldera"), defendant International Business Machines Corporation ("IBM"), by and through its attorneys, states that, contrary to Caldera's allegations, by its lawsuit, Caldera seeks to hold up the open source community (and development of Linux in particular) by improperly seeking to assert proprietary rights over important, widely used technology and impeding the use of that technology by the open source community.
"While IBM has endeavored to support the open source community and to further the development of Linux, IBM has not engaged in any wrongdoing. Contrary to Caldera's unsupported assertions, IBM has not misappropriated any trade secrets; it has not engaged in unfair competition; it has not interfered with Caldera's contracts; and it has not breached contractual obligations to Caldera. In any event, IBM has the irrevocable, fully paid-up, and perpetual right to use the "proprietary software" that it is alleged to have misappropriated or misused."
Here are the nine affirmative defenses:
First Defense
The complaint fails to state a claim upon which relief can be granted.
Second Defense
Caldera's claims are barred because IBM has not engaged in any unlawful or unfair business practices, and IBM's conduct was privileged, performed in the exercise of an absolute right, proper and/or justified.
Third Defense
Caldera lacks standing to pursue its claims against IBM.
Fourth Defense
Caldera's claims are barred, in whole or in part, by the applicable statutes of limitations.
Fifth Defense
Caldera's claims are barred, in whole or in part, by the economic-loss doctrine or the independent-duty doctrine.
Sixth Defense
Caldera's claims are barred by the doctrines of laches and delay.
Seventh Defense
Caldera's claims are barred by the doctrines of waiver, estoppel and unclean hands.
Eighth Defense
Caldera's claims are, in whole or in part, pre-empted by federal law.
Ninth Defense
Caldera's claim's are improperly venued in this district.
4:55:42 AM
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