SCO "Disappointed" by Red Hat Lawsuit 778
schmidt349 writes "SCO has issued a preliminary response to Red Hat's lawsuit, in which President and CEO Darl McBride advises that SCO will prepare a "legal response" to Red Hat's requests for injunctive relief. In addition, he promises that the countersuit that SCO will file may include "counterclaims for copyright infringement and conspiracy." His final statement-- that Red Hat's "decision to file legal action does not seem conducive to the long-term survivability of Linux--" is chilling in light of the business strategy that SCO has adopted in its sales of UnixWare licenses to actual and potential users of the Linux kernel."
Amazing (Score:5, Interesting)
- Darl McBride, CEO, SCO Group
Again, end users are not at risk, if anyone is, but rather the distributors of the Linux kernel in question. Secondly, the code was released by SCO under the GPL, negating the claim. Third, by not asking the "infringers" (who would be IBM primarily and companies like Red Hat secondly) to remove the suspect the code and instead attack the customers of the "infringers", SCO has made no attempt to keep their trade secret a secret at all, which renders it's claim to secrecy invalid in legal terms.
SCO has buried itself. I can't believe that anyone is still buying their stock, all they are doing is making McBride richer.
"In any such meeting, we will provide example after example of infringement of our intellectual property found in Linux. Of course, any such demonstration must be pursuant to an acceptable confidentiality agreement and must be intended to further good faith discussions about resolving the differences between us.........If you seek information for the purpose of informal discovery intended to benefit IBM in the pending litigation, or for the purpose of devising your own litigation plans against SCO related to Linux, we must respectfully decline your request."
- Robert Bench, CFO, SCO Group
In other words, they still refuse to take action in defending their trade secrets and rectifying the problem. No moral judge is going to cut them any slack with this kind of behaviour.
"Of course, we will prepare our legal response as required by your complaint. Be advised that our response will likely include counterclaims for copyright infringement and conspiracy."
- Darl McBride, CEO, SCO Group
It is amazing that this crook has the audacity to suppose that Red Hat is engaged in some kind of a conspiracy, considering the disgusting actions of his company. This is truly laughable.
1st anti-sco lawsuit. (Score:3, Interesting)
SCO's using lawsuits as a business threat? "this may include copyright violation charges!" It feels oddly like mccarthyism, or the salem witch trials, where any skeptics was accused of the crime themselves.
SCO quote (Score:5, Interesting)
So, they're disappointed that other people are choosing litigation, which is exactly what they did. No surprise to me, though; I'm surprised that SCO is surprised.
This is why the Big Guys let Red Hat sue first (Score:5, Interesting)
I'm not saying that Red Hat made the wrong decision - they were injured and are suing - but I think the more Linux players SCO can get involved with litigation, the happier they will be - if they can drag out the proceedings. Imagine the boost to the "Linux has IP problems" line if all the major Linux players are tied up in litigation over IP issues.
The best that can happen is that they lose quickly. But I bet they'll drag it out as long as they can.
I hate their tone. (Score:3, Interesting)
operating system that is an unauthorized derivative of UNIX. Linux includes source code that is a verbatim copy of UNIX and carries with it no warranty or indemnification. SCO's claims are true and we look forward to proving them in court.
First off, don't use FUD in a press-release, that's just stupid.
Second, you might have been showing this section of code but the people you have shown it to have no fucking idea what it is, most people are speculating that it's bullshit anyway, and what's the fucking point? You are STILL fucking spreading GPL'd kernel code (in its entirety as we have been shown 1000x before on
Third, *everyone* looks forward to you showing this in court because you haven't proven anything anywhere else except that you can play God with your stock prices.
Had to expect this from them (Score:3, Interesting)
This only pushes up the timetable.. Bad thing is RH is a more logical target the IBM..
They have a much better chance of squishing RH due to their size. This would set a legal precident that none of us want to see. And it would make it easier to go after the big guys. ( i stil dont know why they didnt try that to begin with.. )
Unlike IBM who can fight and destroy SCO due to their sheer mass..
.
Re:good faith discussions (Score:5, Interesting)
I still believe that Red Hat SHOUDLN'T have sued SCO. Red Hat is going to be drained of money for a loooong time in court. Or do you simply think that by suing, they would win in a few weeks.
Prepare for a long winded fight in which SCO will do ANYTHING in it's power to smear Red Hat.
In the long run, it's not who is right, it's who looks good in the end....
Re:Conspiracy? (Score:5, Interesting)
I'm of course speaking of Microsoft...
How could Redhat conspire with ANYONE?! Did they conspire with IBM to SCO to sue?
Certainly Redhat and IBM will work together in their own defenses (and offenses). They are partners with common interests.
Just as SCO works with (and takes money from) Microsoft and Sun, the two companies with the MOST to lose from Linux...
Re:good faith discussions (Score:5, Interesting)
In this case, countersuing looks better to the consumer than simply allowing SCO's original claims to go largely uncontested in the court of public opinion. It might cost cash, but so does advertising. And in this case, both expenses accomplish largely the same purpose. It's not about winning or losing, it's about making sure SCO can't make Linux look bad.
If redhat didn't say something... who would? (Score:3, Interesting)
Though I often trash talk redhat for not quite being what I want in a distro, I have to give them a pat on the back for this. kudos to ibm as well, though I'm not happy about them sending so many developer jobs over seas.
[***] Can someone answer this question please? (Score:2, Interesting)
In addition, I'm wondering about the rest of the world, like China, Japan, countries in South America, all of which are repidly adopting Linux. They don't need to worry about the U.S. copyright laws so what happens then? Everyone is already pissed at the U.S. so does Linux become a world standard and MS an American one, like NTSC and PAL?
Re:Just disappointed...? (Score:5, Interesting)
I was thinking earlier today how cool it would be if SuSe were to sue SCO in Germany, Novell (through Ximian) in Mexico, Chinese government in China &c. Screw them as much as possible in as many different legal systems as possible. Where possible get some sort of judgement against the directors as individuals as well as corporately against SCO. Destroy their stock price and make sure they can't travel out side the US (preferably inside as well) without getting arrested for contempt of court or something like that.
Even better! does anyone have photos of McBride playing golf with Bin Laden and Saddam?
Vindicitve? Moi?
Stephen
Mystery Code? (Score:3, Interesting)
Re:1st anti-sco lawsuit. (Score:3, Interesting)
Linux Bashed on Kudlow and Kramer! (Score:5, Interesting)
The enemies of freedom were at it again last night. On Kudlow and Kramer on CNBC some analyst hack mentioned Linux's "IP problems" in a Microsoft story. I am afraid that the SCO suit is having its intended affect by negatively influencing public opinion and support by business and analysts. By proxy with SCO, Microsoft is accomplishing what it could not do alone in creating Linux FUD.
By the way the /. crowd has ridiculed Stallman in the past about making contributors sign legal disclosure forms for FSF programs. What do you say now, fools? Had Linus and his open source buddies been half as vigilant about the source of code contibutions, this issue would not exist.
Re:Conspiracy? (Score:2, Interesting)
SCO stocks (Score:3, Interesting)
It's sad so many people are buying into this kind of crap.
Darl reading slashdot? (Score:2, Interesting)
Re:Amazing (Score:5, Interesting)
Re:good faith discussions (Score:5, Interesting)
That MS money won't last them forever...
The IBM suit isn't due in court (Score:5, Interesting)
Until April 2005, as I recall. From my own limited experiences with the legal system, (My father involved in a complex dispute over the family farm, and a drawn out divorce) these things move at a speed akin to continental drift. The whole thing will unfold in slow motion, and like an aging wine cannot be hurried. No matter who wins the 2005 hearing, there are bound to be further rounds of settlement talks. (in the unlikely event SCO gains a partial victory) Legal action involving other Linux distributors and SCO will play out over an even longer timeframe, if there is anything left of the carcass, assuming IBM wins.
This will be both a cash drain and an unfortunate distraction for Red Hat, but it has the positive effect of casting a longer shadow over SCO, since they are now fighting a second front. If other Linux distributors follow suit, (or perhaps band together into a class action?) and sue SCO then it will put even greater pressure on them.
Don't worry (Score:4, Interesting)
Re:SCO Teleconference Today at 2:00 p.m. EDT (Score:2, Interesting)
Re:good faith discussions (Score:5, Interesting)
Re:Amazing (Score:1, Interesting)
I'd say SCO's stock price is more accurately described by the penny stock phrase "Pump and Dump".
The SEC should subpoena SCO records to find whether or not the SCO execs cashing in are pulling a "Pump and Dump". And jail 'em if they are.
Re:Finally... (Score:5, Interesting)
Re:This is why the Big Guys let Red Hat sue first (Score:5, Interesting)
I'm not saying that Red Hat made the wrong decision - they were injured and are suing - but I think the more Linux players SCO can get involved with litigation, the happier they will be - if they can drag out the proceedings. Imagine the boost to the "Linux has IP problems" line if all the major Linux players are tied up in litigation over IP issues.
The best that can happen is that they lose quickly. But I bet they'll drag it out as long as they can.
Actually, I think Red Hat made the right move. By suing first, they got to pick the venue. If they waited until SCO filed suit, then that choice would go to SCO. I've seen discussions on other boards that indicate the Deleware Federal Court is less likely to put up with BS and wants to move things along quickly than other Federal courts. (Ever notice how many corporations are incorporated in Deleware?)
So, Red Hat picks the venue. They also force SCO to fight major lawsuits in 2 different courts.
Plus, there have been reports that SCO's lawyers on the IBM suit are on a contingency basis. This will not be the case for lawyers defending SCO in a lawsuit. So, the Red Hat suit begins draining cash that SCO probably wasn't going through in its earlier suit.
Also, many have speculated that the whole SCO lawsuit was a stock pump and dump scheme, but right now SCO is in between closing the quarter and announcing the results. The SEC generally frowns on insider sales during this period, so Red Hat has filed--an action likely to drive down the stock--at at time that the insiders are prevented from selling without drawing major SEC scrutiny.
All in all, I'd say it was a pretty brilliant move by Red Hat.
Re:Someone break the NDA & post the code. (Score:5, Interesting)
Some time ago, a few people claimed to have been shown the code without signing the NDA. They said that the only significant part of the kernel that was an issue was the scheduler, which looked like it had been copied "line by line" from Unix sources (one presumes the copying wasn't in the other direction).
I'd guess the scheduler will undergo a significant rewrite before kernel 2.6 goes gold... ;-)
The other claimed "infringing" areas are things like JFS and NUMA support that IBM initially developed for AIX and then ported to Linux.
I think it very unlikely that these various subsystems will be found to infringe on SCO's IP.
Re:good faith discussions (Score:5, Interesting)
RedHat's lawsuit can probably get that information far faster than the IBM case would be able to. And as soon as RedHat has it without the NDA, they'll publish it up front and give IBM, Linus & Alan, and the community the time to remove the code if its really infringing and replace it.
DMCA could be our friend here? (Score:4, Interesting)
BUT...A DMCA letter being a instant shutdown of their operation would require SCO to go to a court and validate the need for such a shutdown of Red Hat's business....No sane judge would allow a SCO to shut another down and refuse in court to tell why the offender is liable and refuse to allow the company C&D'd to become compliant. A DMCA C&D would be horrible, but it's something tangible that Red Hat can fight against rather than the "will be open to.." or "We may sue..." that SCO has been spewing lately.
and SCO's stock value keeps going up up up (Score:3, Interesting)
And in the whole affair, Linux gets bad publicity for the guys who hold the Big Money strings. These guys don't care about effectiveness, they don't want to be hit by a lawsuite, which would be MUCH costlier than reducing purchase/licensing costs.
So while Linux keeps making steps forward in our geeky view (yay! just about as easy as winxp! yay! it got an excellent common cirteria certification), SCO is batting it back to the prehistoric age.
Remember, winning such a lawsuite isn't all about "being right". Lawyers know everything of loopholes around "being right", and given enough money will explain by 1+1=2 that Bad is Good. This is going to be long and bloody because it's SCO's last-ditch policy, and we're talking cornered-rat tactics by people with money and getting media attention.
The only thing we can do about it is, if ever your Boss mentions the name SCO, calmly explain how they have absolutely no chance of winning, and any money given to them is straight to the trash, and money refused to Red Hat and other OSS-based companies in light of the fight will seriously hamper lots of excellent quality projects.
*btw aren't there criteria which would quickly kick SCO out of Nasdaq? that would be fun
Re:good faith discussions (Score:5, Interesting)
Actually it has already made Redhat at least a couple of bucks. My RHN demo account was expiring, and I could either renew it by spending a couple of bucks, or by filling out a long questionnaire. At the same time Redhat seemed to be disappearing from my radar having cancelled their desktop linux box set, leaving me in a bit of a quandary for what to do to find a replacement. Debian probably represents the best way of managing a distribution, but the end result is much too unpolished and BSD'ish for my tastes. SuSE might be an alternative although it doesn't have a huge presence in the USA.
Anyway, Redhat filing this lawsuit puts them enough in alignment with my own priorities that I've reconsidered, and signed up with RHN for a couple of Basic accounts. I don't really doubt that RH is primarily concerned about proving the legality of its Enterprise offering, so if the desktop distribution goes seriously out of whack then I'll be looking again, but I'm willing for a while to see what their new mode of operating will put out.
The sad part is that actually used to be a Caldera customer up until Caldera left customers who had purchased 1.0 without an upgrade path. SCO is suffering a terrible and sad loss of judgement.
I always Wonder. (Score:4, Interesting)
Last time I looked at a changelog there were several @hp.com addresses that were adding stuff to the kernal.
What's up with that?
Re:good faith discussions (Score:5, Interesting)
SCO is going to be spending money fighting IBM. IBM has plenty of money.
SCO is going to be spending money fighting Red Hat. Red Hat will have to spend money fighting SCO. (Red Hat is asking for attorney's fees in the lawsuit.) But if Red Hat wins the injunction early on, things are going to look awful bad for SCO before Red Hat has spent any really enormous amounts of money.
I wonder if SuSE is also going to file suit. Maybe they should. SCO's FUD applies to SuSE as well as Red Hat.
If SuSE were to file, than SCO would be spending money defending that action. Assuming that SuSE files in Germany, that would likely complicate things for SCO as well with a bunch more lawyers.
What I'm really curious about is Lindows. They apparently have the right to distribute Linux, but SCO's FUD is likely to be hurting them as well even though SCO seems to have indicated that Lindows is safe. If SCO were to win, I think Lindows would be driven out of existence in short order. I wonder if Lindows will file as well.
The other distributions as well could file suit.
The burn rate for SCO could go up quite a bit in spite of the fact that preparing for one lawsuit may help them against others.
There would still be lots of additional hours spent covering the different jurisdictions. Plus, you'd have to have more litigation teams in place to cover the different jurisdictions.
Lawywers don't like to take on cases that may leave them unpaid. I can't imagine that Boies lawfirm is doing this with the intention of being paid when it is over, especially considering the dubious claims of the case. From what I've seen of lawyers and major law firms, I would expect that Boies would have to be assured of being paid regularly throughout the lifetime of the case before they would accept the case.
One thing that some of the other distributions might want to consider is that when all is said and done, fighting SCO is likely to bring them much greater name recognition from everyone and much good will from current Linux users. Any major distributor of Linux who doesn't fight SCO may find it that much more difficult to survive.
How everyone can hit SCO back (Score:2, Interesting)
I'm not an attorney (standard disclaimer) but I've sued several people in small claims court and I've learned two things:
1. It costs large companies thousands of dollars just to show up for such things.
2. If they don't show up, they lose no matter how ridiculous your claim is.
Why don't we all sue SCO Group in our local area and force them to defend themselves? Imagine 100, 500 or 10,000 lawsuits for $1,000 each against them in every municipality in the country? They'd either spend millions responding to each of them or risk having literally millions of dollars in default judgements against them which they'd have to disclose on their SEC filings and to shareholders. You might even collect the money!
It will cost each of us approximately $50 to file such a lawsuit. Consider that a contribution to the open source movement that you might even get back 20-fold. I think someone should create a Step-By-Step "How to sue SCO in your local area" document. I'm busy.
Re:Amazing (Score:4, Interesting)
Clearly, the onus is not on an IP rights owner to keep their secrets to themselves. The onus is on potential thieves. But nevertheless, their ground becomes far shakier when their own business plan has used Linux extensively, long after they concluded that those rights were being violated. Had they immediately ceased distributing Linux in any form, and notified their customers of the problem, this would have safeguarded their position somewhat. This would be expected of any corporate entity -- to exercise oversight over the products they market, and ensure that they support the company's overall business strategy. Failure to do so, and then blaming outside entities for the consequent problems, is not likely to impress any judicial body.
The issue might come down to whether SCO's publication of the questionable code in their Linux products is equivalent to a willful exposure of their trade secrets. The terms of the GPL may not even enter into the discussion.
Re:good faith discussions (Score:5, Interesting)
The lawsuit seems more likely to affect the long term survival of SCO than Linux.
I have seen this type of situation before. For several years a company called ZixIt littigated a case against Visa. The case was announced on the last business day of the year, this was significant because earlier that year the CEO had said 'people should sell their shares if we have no partners for ZixCharge by the end of the year'. Well there were no partners, customers or revenues but the lawsuit was announced the day that folk had been told to sell their shares.
ZixIt shares went up and up in response to the lawsuit. The bulletin boards were full of people predicting 'huge damages' of hundreds of millions, billions of dollars. In the meantime ZixIt exited the payments business entirely after their payments gateway was hacked.
The lawsuit was over anonymous statements made on the Yahoo buletin board by a person who turned out to be Paul Guthrie, a security expert employed by Visa. Ironically in the light of later events one of Guthrie's allegedly defamatory statements about ZixCharge had been that it did not address the real security issue.
The true believers continued to claim that the lawsuit was a sure fire thing right up to the day that the judgement was entered. Posters gleefully wrote that Visa, a Californian company stood no chance of winning against a Texas company in a Texas court. Hmm, jury bias didn't seem to be a problem for Ophra, It seems rather odd to invest on the assumption that the Texas courts are corrupt.
The jury found for Visa. The stock crashed but still has an amazingly high valuation for the company given their revenues. Guthrie is no longer at Visa, I am told he charges $5,000 a day as an independent security consultant in the Bay area and has plenty of business at that rate.
Re:Prelim Injunction doesn't take long (Score:5, Interesting)
Since a quick win on the injunctions for Red Hat could be a big help to IBM, I wonder if IBM will help Red Hat prepare.
Re:SCO Emergency Conference Call today (blogs?) (Score:3, Interesting)
Re:good faith discussions (Score:2, Interesting)
I thought I remembered it this way also, but searching for the story on
I did find the story about a German court granting an injunction against sco:
SCO Stands Defiant, German Court Grants Preliminary Injunction [linuxtoday.com]
But it was not SuSe, but univention_ GmbH [univention.de] that went to court to get SCO to STFU.
a German court in Bremen granted an injunction to Univention GmbH, a German Linux integrator, against SCO Group GmbH, SCO's German division. The injunction prevents SCO from saying that Linux contains illegally obtained SCO intellectual property, aka Unix source code. If SCO continues to hold this position, they would have to pay a fine of 250,000 Euros.
If there was a similar action by SuSe, I couldn't find it.
my favorite parts (Score:3, Interesting)
This from a company who's only possible sources of income are related to suing, or threatening to sue everybody.
I must say that your decision to file legal action does not seem conducive to the long-term survivability of Linux
This from the company that has been bashing Linux non-stop for months now, and who plans to eliminate Linux as it now known.
Be advised that our response will likely include counterclaims for copyright infringement and conspiracy
Gosh, I thought Darl hated all that nasty litigation. Conspiracy? Sort of like Microsoft and Sun secretly funding Scox's anti-linux FUD campaign? Or Sco's actions being dictated by Canopy Group?
http://biz.yahoo.com/prnews/030804/lam110_1.htm
Re:Why doesn't RedHat just buy them? (Score:0, Interesting)
SuSe will remain quiet. (Score:3, Interesting)
Besides, It's mostly Suse's implementation that SCO is distributing RIGHT NOW. They're best to remain quiet and stick by the terms of their current contract. Should SCO try to weasle out..then SuSe will have lots of ammo!
My own letter (Score:3, Interesting)
Re:Why not Replace the "Copied" code (Score:3, Interesting)
The original Red Hat letter to SCO demanded an identification of the allegedly infringing code, in enough detail that the issues could be fixed (whether or not the allegations were subsequently shown to be true).
What I don't know is whether SCO's refusal to respond damages their case, but I suspect it does; even if they can prove infringement, they have failed to take steps, in this action, to minimize harm to themselves. If I understand correctly, that isn't good for them.
Non-disclosure agreements (Score:3, Interesting)
and
I don't get it. NDAs (or confidentiality agreements) are meant to keep "trade secrets". Regardless of the legal status of the code in question, it is openly viewable in the GNU/Linux source code. They are not keep the code secret, they are keeping secret which sections of code are in copyright violation. If not for FUD (which they deny), what possible purpose could they have for the NDAs? Has anybody ever seen them explain why? I can't think of any legitimate reason for it. I'm not saying they don't have one, but I'd like to hear it.
Using SCO's GPL defense against itself (Score:3, Interesting)
Couldn't Red Hat or any other distributor use a similar argument? If they used the kernel in good faith, unaware of the alleged infringement, aren't they just as 'innocent' as SCO when it comes to the distribution of a tainted kernel?
Red Hat sort of shot themselves in the foot, I think, by launching a counter-suit before making an official offer to remove code that SCO claimed was infringing. When they end up in court, it would have looked much better for Red Hat to have offered to fix the infringement and have SCO deny that offer than to have just flat out refused SCO's claim and instead launch the injunction.
Re:Why doesn't RedHat just buy them? (Score:5, Interesting)
Don't buy them, short them (Score:3, Interesting)
Re:good faith discussions (Score:3, Interesting)
In that particular view, they are, in a sense, impeding justice and preventing what they view to be offenders from "fixing their mistakes" as that would pull the soapbox right out from under them.
This very action on SCO's part may be their undoing.
You're damned if you do show the "infringing" code, and you're damned if you don't. But the correct thing to do would be to get the infringement to stop ASAP. Instead SCO is trying to turn Linux into a money machine rather than get the infringement to stop.
If the infringement were to stop, then they couldn't charge $699 licenses. They want the infringement to continue. This very fact will not look good in front of the judge.