The truth about the SCOX/EV1 SCOsource deal

For the first time in a long time, we have multiple SCO stories in the same month. Groklaw now has the gory details on how the SCOsource deal with EV1 went down. Here's the full (PDF) declaration from EV1 CEO Robert Marsh. It's clear that he was duped by SCO, that he really did have the best intentions for his customers in mind and that he very quickly regretted the decision. Disclosure: At the time this happened, I was in negotiations with EV1 to potentially enter into a trade agreement where they would provide a server or two to LQ in exchange for advertising. When the SCOsource deal was announced I immediately terminated the negotiations. I made that decision with the information I had at the time. In the end I chose not to enter into an agreement with anyone (a decision I do not regret). Here are a few tidbits from the linked document:
Although Mr. Langer had stated in his January 13, 2004, letter that we would discuss the alternatives and solutions available to EV1, Mr. Langer made it clear from the beginning of our discussions that there was only one course that would satisfy SCO: EV1's agreement to purchase a Linux license from SCO called SCOsource. There was not any discussion of any alternative other than a SCOsource license or litigation.
In describing the infringement in Linux as pervasive, Mr. Langer and the others never expressed any doubt as to the strength or certainty of their claims. The impression I received was that it was only a matter of time before SCO would prevail in its lawsuits against various Linux companies and users. They also told me that many other companies would be sued in the immediate future.
Mr. Langer or others representing SCO told me that a lawsuit against EV1 or our customers could result in a temporary restraining order or an injunction mandating an immediate shut-down of EV1Server.net's Linux servers. I take great pride in the consistency and reliability of our hosting infrastructure, qualities for which EV1Servers.net are well-known in the industry. A shut-down, or even the possibility of one, would have been severely damaging to our hosting business. I felt pressure and urgency to avoid that outcome.
I was given a brief opportunity to review the joint press release before it was issued, but did not fully consider Mr. McBride's statement before giving my approval. Mr. McBride's statement was a mischaracterization of our decision. During negotiations, I told Mr. Langer that my decision was based solely on business considerations. There was never any understanding on my part that EV1 was endorsing the validity of SCO's copyright claims.
Within an hour of the issuance of the March 1, 2004, press release, I began to receive criticism from my customers over my decision to purchase a license from SCO. Many of my customers considered EV1's payment for the license tantamount to funding SCO's litigation efforts and its attack on Linux. The criticism intensified over the ensuing weeks. We received hate-mail from people interpreting our agreement as validating or endorsing SCO. We were accused of betraying our customers and aligning ourselves with a company considered to be the enemy of the open source community. Some of our customers threatened to, and did, leave EV1Servers.net. I did not anticipate the overwhelmingly negative response from our customer base. In agreeing to purchase the SCOsource license, I believed that I was serving the interests of our customers by shielding them from SCO's threats of litigation. Ironically, although my intention was to take EV1 and our customers out of the fray, my decision resulted in EV1 being placed at the center of it. As reported in a March 25, 2004, article in InfoWorld, a true and correct copy of which is attached hereto as Exhibit 8, I stated, “All of a sudden we went from being reasonably good guys to being, in some people's eyes, akin to the devil.”
On March 25, 2004, I stated publicly that I regretted my decision to purchase a SCOsource license. As reported in various publications, I stated, “Would I do it again? No. I'll go on the record as saying that. I certainly know a lot more today than I knew a month ago, in a lot of respects.”

As I said, it's clear that he was mislead by SCO and that he 100% regretted the decision almost immediately. We also learn that the actual amount paid by EV1 was $800,000. I don't know how some people from SCO sleep at night, but I hope Robert Marsh has a clear conscious. While he clearly made an expensive mistake, it was a well intentioned business minded decision. It's very hard to fault him for that, and I for one don't. EV1 (now merged) remains one of the largest Linux hosting facilities on the planet. Good for them.
–jeremy
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