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Tuesday, September 30, 2003

SCO Motion Granted by Judge Kimball --Feb. 4, 2004 Is Filing Deadline

Our fabulous Frank Sorenson ran to the courthouse and got the papers for us. Judge Kimball signed the Order saying that SCO has until Feb. 4, 2004 "to file any amended pleadings or add parties to this action".

So it's a fait accompli, or as we say in the US, a done deal. Here's the pdf of the signed order.

I have SCO's Motion for Enlargement. Basically, their argument was that they didn't have enough time to meet the original deadline and do discovery. Because IBM just filed new counterclaims, they argue, they need time now to do discovery and if the discovery process comes up with new information, they might want to amend their pleadings or add parties. They can't say that would happen now, but if they are forced to meet the current deadline, they'd amend without the discovery process and conceivably miss that opportunity.

Their basis for asking for the time delay in paraphrased detail:

1. Discovery isn't finished, and the original time schedule presumed it would be by now; IBM hasn't provided, they say, what they asked for. SCO has "been providing discovery" they say in footnote 1, but the rest of the footnote says that actually they won't be providing tens of thousands of more documents until "early next week". Translation: we haven't provided everything either.

2. "...other circumstances have drastically changed... Specifically, IBM recently has filed an eleven count counterclaim, including four separate claims of patent infringement." This means time is needed for more discovery. During discovery, it could happen that there would arise the need to add parties, depending on what is learned, or to amend SCO's pleadings. Further SCO didn't yet file its answer to IBM's counterclaims, and the deadline for that is October 1.

3. SCO requested time to enlarge, but IBM refused.

4. Prejudice will be suffered by SCO if it is forced to amend its pleadings without the benefit of further discovery.

comment [] 6:01:23 PM    

Red Hat's Memorandum in Opposition to SCO's Motion to Dismiss

Here is Red Hat's Memorandum in Opposition to SCO's Motion to Dismiss, as a pdf. I am just reading it myself and haven't finished yet, but I thought you might like to join me and read along at your earliest opportunity. I am up to page 12, and it's excellent so far. We'll talk about it later. For now, just enjoy having it to read.

comment [] 6:00:11 PM    

SCO Files Motion To Extend Time to Amend, Add Parties

SCO has filed a motion with the court in Utah, filed on September 26 and entered on the 29th, a Motion asking for more time, until February 4, 2004, to amend their pleadings and add parties.

Your guess is as good as mine. It's not digitized yet, so the only way to know is to get a copy of the motion from the courthouse or wait. It's possible the motion doesn't specify much as to who they wish to add, just that they want to. But until February 4, 2004?!? That's a 4-month delay. Maybe they have a lot of parties to add? Maybe they are in no hurry to have this adjudicated? Or maybe they're being tutored in the GPL? That subject is hard for them to master, it seems, so here's hoping that's it.

comment [] 5:58:51 PM    

Sometimes You Just Want to Have a Good Laugh

A friend sent me this link to a takeoff on a SCO press release. It made me smile, and I realized sometimes that's exactly what is needed. If you are in the same mood, here -- thanks to Matthew Peavy's willingness to share his "IP" freely -- is his parody on the SCOShow in full.

Tuesday, Sept. 23, 2003
Lindon, UT
The SCO Group (SCOX)

SCO Group, a leader in IP litigation, has announced that they have recently trademarked the English letters S, C, and O, and all combinations and derived works thereof. SCO announced this important update on Tuesday as another legal front in their long and on-going series of IP lawsuits. The SCO Group is involved in various Intellectual Property (IP) disputes with organizations ranging from IBM and RedHat to LinuxTag of Germany.

SCO plans to leverage their valuable intellectual property (IP) trademark for use in pursuing litigious claims against other companies and individuals who are currently infringing their trademark. The same trademark, including derivative works, is pending in several other languages, the SCO Group reported.

The trademarking of letters, their individual and combined uses, and all derivative works, will allow SCO to protect investments previously made in this area.

Darl McBride, CEO of the SCO Group, questioned whether there would be an end to the infringement of their intellectual property rights. "It seems that every time we turn around, our team of specialists and engineers has detected another word containing our valuable IP (intellectual property). They are using spectral analysis and mathematical models. This is a really exciting time for us." Looking forward, McBride said, "we just want to get this cleared up and protect our IP. Licensing from us will protect us and our customers from potential lawsuits." McBride announced that a licensing plan would be unveiled by the end of the week.

David Boies, famed high-profile lawyer, has been retained to "protect this valuable IP, and its associated and derivate works" for the SCO group. Boies said that trademark law explicitly permitted such protections of derivative works. "For example, we consider the 'Scott Brand' bathroom tissue name to very seriously infringe on the SCO Group's trademark." Boies stated that diverse products ranging from scotch whiskey to the soccer ball may eventually require licensing. Use of the word "fiasco" will generate a per-use licensing fee if used in a commercial setting, stated Boies.

Although involved in other IP suits with SCO, IBM and RedHat have been cleared of any infringement in this area of trademark dispute. Chris Sontag, Senior Vice President at SCO, says, "We're concentrating on the SuSE's, Compaq's, and O'Reilly's of the world. Sun has licensed our valuable, proprietary IP, and has fulfilled its fiscal obligations to us." Sun recently announced a plan to indemnify its customers over the use of the letter "S".

Microsoft, a company highly regarded for their respect of intellectual property, has reportedly been in negotiation with SCO for a license. Microsoft, who risks infringing a 'derivative name' based on all three letters, is eager to finalize negotiations with SCO. "Microsoft, in it's ongoing quest to respect the valuable intellectual property of others, is investigating the terms and conditions under which we can best protect the intellectual property rights of the SCO Group," stated Tom Burt, Deputy General Counsel for Microsoft.

The up-start Linux operating system, which is involved in other IP disputes with SCO, has dodged a bullet in this round of the fight. The OpenOffice group, however, appears to be "treading all over our proprietary IP in this matter" said McBride, and should be prepared for a costly legal fight.

Laura Didio, senior analyst for the Yankee group, has viewed documents provided by SCO proving trademark violation. "Although I can't reveal exactly what companies' names contain S, C, and O [due to a non-disclosure agreement], there is obvious and serious infringement. I think they have a real case here." Didio went on to advise companies to seek legal advice on the matter. "Thank god Yankee is safe," Didio is quoted as saying.

SCO views this potential revenue stream as "exciting, potentially explosive." SCO's share price has risen from a low of $0.78 earlier this year to an impressive $20 level. McBride views the current 165 P/E ratio as in-line with their growth strategy. "We've got nearly all the areas of IP covered, from lawsuits over copyright and trade secrets to patents -- and now trademark. In addition, we've cut costs significantly, specifically in R&D, support, and sales. And we've pumped up our legal fund dramatically. We have positioned ourselves as a serious litigant in the profitable IP arena."


(C) Sept 23, 2003
Matthew Peavy

Please copy this and distribute.

comment [] 5:56:57 PM    

What About Kernel Contributions from Canopy Group?

A Groklaw reader raises an interesting question after reading the interview with Ralph Yarro in Sunday's Salt Lake Tribune. One part of the interview particularly drew a reaction, namely when Yarro said this:

"'I grew Canopy out of Linux, period,' he says. 'Many of the people in our companies are guys who can easily stand up and say we, too, are contributors.'"

Our reader responded that maybe that isn't the safest source of Linux contributions, given what we now know:

"I happen to think that Bruce Perens hit the nail on the head when he said: "'Canopy Group never understood how to be our partners,' he wrote. 'They've chosen to screw us one last time on the way out the door.'"

Here's our reader's opinion and then a question for Canopy Group's Yarro:

" . . . Remove the participation of the Canopy Group, and Linux moves forward. Continue with them, and we will continue to see litigation. . . . The only way out is to begin to demand they (Canopy Group companies) indemnify all users of Linux products from their . . . bosses (the Canopy Group). If they refuse, then their contributions must be removed. . . . I think the community needs to demand from YOU that you indemnify all users of Linux and Linux-based products, or you simply stop all of your Canopy Group contributions. One or the other, make up your mind. . . . Are you willing to indemnify users of Linux? If not, why not?"

So, what do you think? Is it dangerous to accept contributions from Canopy Group employees -- or even ex-employees -- without indemnification against litigation from Canopy Group and from whatever Canopy Group company the employee works for when he or she makes the contribution? Would Canopy Group and its companies be willing to offer such indemnification? As our reader pointedly asks, if not, why not? And deeper still, if not, what then?

comment [] 5:53:22 PM    

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