Judge Kimball Rules on SCO v. Novell

It looks like Judge Kimball has finally issued a ruling on SCO v. Novell. From the article:

OK. I’ve read it now once through, and the big picture is this: Judge Kimball did not change anything in his August 10th order, which I was afraid might happen. He could have, had he heard anything that he didn’t know when he made that order. So, SCO breached its fiduciary duty to Novell, converted funds, and so it has to pay. That is ironic, in that this case started with SCO accusing Novell of slander of title, and asking for millions in damages. Instead it has to *pay* Novell millions.

However, Judge Kimball accepted SCO’s argument that UnixWare is the latest version of UNIX and that it was the foundation of all the other agreements, even though SYSV was also involved, or so SCO thought. He accepted SCO’s argument that if SCO was wrong about owning the copyrights, and it was, then it’s too bad for the licensees — they just got less than they thought they were paying for, and that is a matter for them to work through with SCO. So if EV1, for example, wanted its money back, or part of it, it would have to sue SCO.

I think this is an appealable issue for Novell, but I don’t know if they will bother. This was all about money, this trial, and very narrowly about whether SCO owed Novell anything from the Sun and Microsoft and SCOsource licenses. The rest was decided already on August 10th. And SCO doesn’t have much money left, if any, so I would guess that if SCO appeals, Novell will raise issues it certainly can in this new order. And it’s a bit hard to fit SCOsource into the APA, since it was just a strange and vague bird. But if SCO doesn’t — and to my mind the order seems designed to discourage it, since if they do appeal, they risk being found liable for even more money than now ordered — Novell then has to figure out if it is worth it.

For its part, SCO is attempting to spin this as somewhat positive:

In an e-mailed statement today, SCO described the ruling as “an important step in (its) ability to pursue the appeals to try to get all of (its) claims heard by a jury as soon as possible. We are pleased, however, that the court agreed that Novell is not entitled to anywhere near the more than $20 million dollars it was seeking.”

“Importantly, the court ruled that Novell has no right to any royalties from UnixWare or OpenServer sales by SCO, which is where the bulk of SCO’s revenue is earned,” SCO said in the statement. “This is also an important step forward in the capitalization and reorganization plan for SCO that will allow us to emerge from Chapter 11. We continue to disagree with the premise of this trial and believe that Novell is not owed anything, but that they have interfered with SCO’s UNIX rights.”

The company is reviewing the ruling by Judge Kimball with its attorneys and will be assessing the next steps over the coming days and weeks.

Realistically, SCO is probably going to appeal and it looks like they are attempting to go for a jury case. I’m not sure how much cash they have on hand, but it looks like because they were acting as an agent for what was always Novell money, the full amount should be given to Novell before any further creditors during bankruptcy. With the IBM ruling not handled down yet, things don’t bode well for SCO. Whether someone will pick up the carcass or they will just go away remains to be seen.

–jeremy

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One Response to Judge Kimball Rules on SCO v. Novell

  1. Pingback: Bookmarks about Sco

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