SCO Preps Appeals Against Novell and IBM 163
An anonymous reader writes "It looks like SCO will be emerging from the almost dead soon, with new owners and $100 million on board. SNCP is adjusting the business strategy, according to this report on TG Daily, SCO is saying goodbye to CEO Darl McBride and is also preparing to appeal the summary judgments in the cases against Novell and IBM. If you have thought the chapter was closed, think again. Those $100 million can go a long way (even if SCO has to pay 17% interest on it)."
Now that's a deal. (Score:5, Insightful)
Comment removed (Score:5, Insightful)
The Wizard of Oz (Score:5, Insightful)
Pay no attention to the largest proprietary software company in the world behind the curtain.
SCO doesn't have anything yet (Score:5, Insightful)
They don't have squat until the BK court approves it. Even then they only get 5 million and 95 million in flash cash. If the trustee tells them to put the money in escrow against potential judgments from IBM and Novell, that will flush this deal. This is all show but I haven't figured out who the audience is supposed to be. The BK court isn't going to be impressed.
I'm not sure what they're going to appeal. SCO dug themselves a really deep hole, an appeal is a long shot.
No one with a brain would loan SCO a nickel. It would take a cash cow like Microsoft to convince anyone to get in bed with SCO. Maybe that answers who the audience is supposed to be. Like there are serious players who think SCO's IP claims have merit. Ooooo, scary. If that's the case this is to business strategy what the Zune is to Apple.
Darl could learn from the Monkey Dancer (Score:3, Insightful)
Why in the world would someone take $100 Million perfectly good dollars and just throw them into this worthless money pit? Incidentally, if you write SCO as $C0, and then move the C to the front, you've got, "See? $0." And it seems to me that's what everyone ends up with who touches this thing with a 100 million foot pole! Who in the heck wants SCO's OS anymore? You know what? Even if they do want it, does anybody really want software from a company that might disappear at any moment due to all this litigation drying up it's well of money? Where will they get support?
Especially, why would they do this when Linux and the *BSDs are so far superior at this point due to the efforts of millions and the incredible amount of support, mindshare, and money behind them from individuals, small businesses, large businesses, and even governments. Not to mention that all modern Apple Macs are running a UNIX operating system that can accomplish all, or at least nearly all, of the functions that can be accomplished by any other UNIX or UNIX-like system out there. Not to mention further that all of the aforementioned OSes are superior in an uncountable number of ways to SCO's OS. Not to mention that the entire code to Linux and the *BSDs is available for your perusal or participation, as with a tremendous variety of programs that are run on these systems, from Apache to something that starts with a Z. Why would anybody pay good money to SCO for it's stuff when SCO is acting like the bully at the playground and when all of this is available for free, both libre and if you want to download and build stuff yourself, gratis...
In my opinion, SCO is no longer a software company, but a litigation company.
I can live with that (Score:5, Insightful)
Using this 21% loan to file appeals is a lot like using your credit card to buy lottery tickets.
They're that desperate, and I can live with that.
Re:poetic justice (Score:1, Insightful)
1. The U.S. legal system lets you fuck around if you have enough cash.
2. Microsoft has enough cash.
Re:Put SCO down (Score:-1, Insightful)
Re:What the hell? (Score:3, Insightful)
Re:Now that's a deal. (Score:5, Insightful)
We've determined that:
- They never ponied up the code that supposedly infringed, strongly suggesting that it doesn't exist.
- They didn't even have the right to the copyrights of the Unix code they claimed Linux infringed upon.
- They (probably fraudulently) collected license money for "protection" against the non-existent claims in #1 on the inelligible code in #2.
- They did it all while making themselves rich and the stockholders poor through pump-and-dump.
Shouldn't people like this be in jail?Re:poetic justice (Score:3, Insightful)
Re:Well (Score:3, Insightful)
But in this case, there are no legitimate viable parts of the business. Suing your customers is NOT a viable business, and suing your suppliers for owning stuff you stole from them isn't either.
Re:who cares yet? this is not factual. (Score:3, Insightful)
article here = incorrect
This is one of the worst articles I have ever seen! Not one bit of investigation was done, while there is voluminous information readily available elsewhere on this topic. It is like posting some company's press release and calling it news reporting. My first impulse was to do a little research to find out who is this TG Daily. Apparently it sprang from Tom's Hardware, but both are owned by TG Publishing LLC, a Bestofmedia Group company. The author is Wolfgang Gruener, a senior editor. A half hour on Google only found one little negative comment about TG Daily which I determined to be merely gossip not worthy of repeating. I found one other gripe over an article they had done on Linux. It was an esoteric complaint. In the end, that blogger posted an update saying that TG Daily had rectified the problem. Really, after scanning all the Google results, it certainly appeared that this journal had at least a "satisfactory" reputation. So then, how can such lousy piece of fluff journalism have come into existence? Maybe writers are only human, and have their good days and bad days like everyone else. This article must have been written on a very bad day in the life of Mr. Gruener.
Re:Now that's a deal. (Score:5, Insightful)
I think the goal here is to get SNCP onboard as a creditor ahead of any judgements against SCO. That way, they can continue to run up the expenses and drag out the court actions. When the day of reckoning is finally here, SNCP will be a huge creditor. They will take quite a loss, even after chewing up what remains of SCO. I suspect SNCP will get reimbursed via the PIPE fairy or whoever was underwriting the deal with Baystar.
As a private company, SCO will be exempt from all kinds of shareholder disclosures, SEC regulations, etc. Very useful in pursuit of this strategy.
There is one factor that the SCO folks may not have considered: Their strategy sets a scary precedent. If it works, we might see the "scorched earth" defense become commonplace. We might even see individuals doing the same type of thing when faced with a liability suit. This would make a mockery of the judicial system. SCO has to lose, and lose big. Their financial co-conspirators need to be exposed and clobbered. Unless they get a royal smackdown from the court, this behavior will be validated and probably repeated by others in the future.
Except For One Thing (Score:5, Insightful)
As a bonus, the court that will be deciding how much it is will be the same one that SCO told no trust fund was required because bankruptcy wasn't imminent just a few weeks before they filed for bankruptcy. They are almost certainly well and truly fucked here, and "spin" isn't going to change that. Their whole strategy seems to be to provoke the judge to anger so they have an issue for appeal, but Kimball is a pretty cool customer who will make sure that his ruling is air-tight.
The Utah court's summary judgment held that SCO does *not* own the copyrights to the code they are licensing. SCO built their entire case around a theory of "but... we paid a lot of money for this business, and of course it transferred the copyrights to us! Never mind what the actual contracts said." Too bad for them that the court rejected that argument totally.
And, this article presumes that the BK court will approve the deal, and do so over the objections of the major creditors. The judge may well not approve the deal as written, as there is no real guarantee of the additional $95M being actually available, and further since the $95M is a line of credit at a 17% interest rate it could magically evaporate at any time.
The deal really doesn't provide any security for the creditors at all, nor does it put the post-bankruptcy SCO in a financial position where it is unlikely to be back in bankruptcy in the near future. Indeed, it puts the company squarely in debt for even more than it faces to begin with due to the interest. The creditors names change, but the debt remains and really grows exponentially.
The only way I can see the court approving this is if the entire $100M were a straight-up equity purchase which was a cash infusion sufficient to pay off and retire all the debt. Just moving the chairs around on the deck isn't going to pass muster here.
As for the appelate courts, SCO's behavior prior to summary judgement will be a huge factor. They dragged the case out, refused to comply with discovery orders, and changed their arguments constantly.