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Caldera Software The Almighty Buck Linux

10K Filing Suggests Grim Outlook for SCO 149

Posted by Zonk from the truly-a-stunning-development dept.
dacarr writes "SCO has filed their 10K with the SEC — and according to this, their own assessment of the company's outlook is pretty grim. As usual, PJ of Groklaw has a good synopsis of the filing highlights. In short, it boils down to one thing: unless there's a miracle, even SCO doesn't think they're going to come out of this. 'As a result of the Chapter 11 filings, realization of assets and liquidation of liabilities are subject to uncertainty. While operating as debtors-in-possession under the protection of Chapter 11 of the Bankruptcy Code, the Debtors may sell or otherwise dispose of assets and liquidate or settle liabilities for amounts other than those reflected in the consolidated financial statements, in the ordinary course of business, or, if outside the ordinary course of business, subject to Bankruptcy Court approval. In addition, under the priority scheme established by the Bankruptcy Code, unless creditors agree otherwise, post-petition liabilities and prepetition liabilities must be satisfied in full before stockholders are entitled to receive any distribution or retain any property under a plan of reorganization.'"
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10K Filing Suggests Grim Outlook for SCO More

10K Filing Suggests Grim Outlook for SCO

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  • R.I.P. (Score:2, Funny)

    by scharkalvin ( 72228 )
    Rest in Pieces

    • Re: (Score:3, Funny)

      by somersault ( 912633 )
      More like Roast In Pieces (of faeces?)
    • ...Please sing! When will it end?
    • If they are split up into pieces, it increases the likely hood that some well funded patent troll will pick up part of them and resume the lawsuits. I'd like it if the court just rules that all of SCO belongs to Novell. Then Novell should just release any of the things that SCO claimed were UNIX code, or ideas as GPL.
      • I doubt Novell can release SCO's products under the GPL.

        If you've ever dealt with a SCO system, the copyrights are a complete mess. Many of the header files have Microsoft copyright notices along with the ones you would expect. There's BSD notices. There's AT&T notices. The cost of sorting all of this out to where it could be released under any license would probably be extreme.

        Then SCO made a bigger mess by packaging FOSS into their "custom" packages, not giving notice to SCO users about the real sourc
        • No problem. Just said GPL cause thats what the license of linux is. Therefore it couldn't possibly be a problem to have Gpl'd cod in a program that was licensed under GPL. But BSD works as well. Really looking forward to putting BSD 7 through its paces. Much love for BSD.

  • My Mutual Fund :-( (Score:4, Funny)

    by Anonymous Coward on Tuesday February 05, 2008 @08:46AM (#22305728)
    Looks like my "America's Sleaziest Companies" mutual fund is going to take another hit this year.
  • The final stages of the slow motion train wreck that is SCO begin.

    We hope.

    • How many times are we going to read the same headline? "SCO is bankrupt," "SCO filed a report with the SEC declaring bankruptcy," "SCO doesn't believe they can survive this lawsuit." They're dead. This is old news.

      • Re: (Score:2)

        by mpe ( 36238 )
        How many times are we going to read the same headline? "SCO is bankrupt," "SCO filed a report with the SEC declaring bankruptcy," "SCO doesn't believe they can survive this lawsuit." They're dead. This is old news.

        How about "SCO to relocate to Sunnydale" :)

      • Re:Ah, yes! (Score:4, Funny)

        by morcego ( 260031 ) on Tuesday February 05, 2008 @11:28AM (#22307754)

        They're dead. This is old news.


        Do you mind ? We are entitled to all the gloating we can get out of this.
  • Enough already. You "won".

    • Re: (Score:3, Funny)

      by rubycodez ( 864176 )
      no, there are matters which only a court of law can resolve the SCOX stories will continue. you will read the SCOX stories. you will love the SCOX stories. you will smile as you read and love the SCOX stories.
      • They were delisted at the end of December.
        • at the moment their symbol is SCOXQ.PK, would you feel better with SCOX*.*?

    • Re: (Score:3, Funny)

      by Anonymous Coward

      Leave SCO alone right now! I mean it! Anyone that has a problem with them you deal with me, because them is not well right now.

  • huh? (Score:5, Funny)

    by gEvil (beta) ( 945888 ) on Tuesday February 05, 2008 @08:50AM (#22305778)
    Things are looking grim for SCO? I obviously missed something. When did this happen?
  • ...and SCO confirms it.

  • Finally! (Score:1, Informative)

    by Doug52392 ( 1094585 )
    Took SCO that long to go bye bye? I can't wait until they go completely broke. SCO thought that, since they bought Unix from AT&T in the 1990s, that they should own Linux as well and sued everyone. About time they fell as a result of that! Rest in Pieces, SCO :)

    • Re:Finally! (Score:4, Insightful)

      by Ngarrang ( 1023425 ) on Tuesday February 05, 2008 @08:56AM (#22305838) Journal
      I feel sympathy for the employees who were unable to find other employment already. They will soon be without jobs. I mean, if they are still THERE, their prospects are certainly not any better once unemployed.

      • Re: (Score:3, Interesting)

        by Lumpy ( 12016 )
        The other problem is the stigma on your resume now.

        "I see you have a long.... Oh.. you work for SCO right now? I have heard enough, we will be in touch. Have a good day."

        The rank and file are not responsible for the stupidity but it does affect you when you are out there looking for jobs.

        • Re: (Score:3, Funny)

          by ari_j ( 90255 )
          You're forgetting one thing. SCO is just about entirely a legal team now, so anyone who currently works there is not only a lawyer but a lawyer who is capable of joining in SCO's legal chicanery with a straight face. I don't think they'll be so bad off.

          • Re: (Score:2)

            by HiThere ( 15173 )
            Do they outsource their janitorial work?

            The lawyers generally work for firms, and won't have SCOX on their resumes unless they decide to. Even Darl's brother seems not to be an employee.

            The people left are secretaries, a FEW software people (I think) and possibly some janitors. And Darl. (I haven't checked their web site, so this is just what I've pieced together en passant. Don't rely on it for anything important.)

            • Re: (Score:2)

              by ari_j ( 90255 )
              You must be new here.* This is Slashdot, where we don't let facts get in the way of a good joke, a heated discussion, or even an outright flamefest.

              * - I know you have a uid about 1/6 of my own, so maybe you just had a momentary lapse.
        • Not to be snarky, but they could've left in mid-2003 (when SCO first filed), in 2004, 2005, 2006, 2007... each year harder than the last to explain, but still...

          Utah's local tech industry had a bit of a boom during 2005-2007 (I lived there up until early 2007), so it's not like they didn't have a choice.

          If an employee stuck with them for this long, pity is going to be kind of hard to come by, IMHO.

          /P

      • Oh PLEASE! I have ZERO sympathy for any loser that has stayed with SCO this long. In fact, in the history of IT I can't think of any group of employees that deserve to be laid off more.

        Anyone who has continued with SCO after all these years of FUD, lies and litigation deserves nothing but heartache. In addition I *highly* recommend they avoid applying where I work, if I see SCO on a resume that continues past 2003 they can take a hike.

        In my view they were complacent in a lie. Besides that the writing wa
      • It's called social Darwinism. If, as a SCO employee, you buried your head in the sand and let the companies mgmt run it into the ground, and have a hard time finding work, good... sorry don't be such a sheep next time.

        I'm sick of sympathy for people that would claim they were "just doing their job." Their job is being an accountant, a software engineer, a janitor, whatever, which can just as well be done at a company that isn't in a hurry to fuck themselves over.

        That's just my opinion. I could be wrong.
      • It's like when I worked at Pets.com. The stock was at 2 cents--for a couple months.

        My boss turned to me one day and said "Ummmm...what the hell are you still doing here?" (While I was browsing the internet and my mouth full of bagel.)

        That was my notice. Seriously.

    • Re:Finally! (Score:4, Informative)

      by armanox ( 826486 ) <asherewindknight@yahoo.com> on Tuesday February 05, 2008 @09:24AM (#22306102) Homepage Journal
      Actually SCO didn't buy UNIX from AT&T. Novell did. And that's the whole problem. SCO thinks they bought it from Novell, but they didn't.
      • s/thinks/claims

      • Re: (Score:2)

        by dbIII ( 701233 )
        The whole problem was really a scam on SCO. Linux was just the excuse and IBM was the brick wall to run the company into to create the chaos required for the scam. The courts were slow because they are not set up to handle people bringing deliberately unwinnable cases in. A lot of those legal costs went directly to Darl's brother. SCO will vanish but Darl will go on to cause havoc elsewhere, and if he repeats his earlier behaviour he will sue what remains before it goes.

    • Re: (Score:2)

      by Secrity ( 742221 )
      SCO doesn't own Unix. Caldera (now called SCO) bought the old SCO Unix distribution. They also have the right to sell licenses to Unix System V; but they have to give 95% of the Unix license money to Novell (who owns Unix System V).

      Neither Novell nor SCO owns the "Unix" name, UNIX® is a registered trademark of The Open Group. http://www.unix.org/trademark.html [unix.org]
  • "...in full before stockholders are entitled to receive any distribution or retain any property under a plan of reorganization..."

    All 3 of them?

  • In the words of that old country classic (Score:4, Funny)

    by sizzzzlerz ( 714878 ) on Tuesday February 05, 2008 @08:56AM (#22305834)
    How can I miss you if you won't go away.

  • Debtor's Prison (Score:4, Interesting)

    by bhima ( 46039 ) * <Bhima,Pandava&gmail,com> on Tuesday February 05, 2008 @08:57AM (#22305848) Journal
    Unless this includes all the SCO management doing a stint in some medieval debtor's prison, it's not nearly grim enough.... On the other hand I think this is a great opportunity to start a Linux distro with SCO personality to provide all the remaining SCO user base a less painful transition after the death of SCO. We could even call it Pescadero Linux, because we all know how well the last project with that name turned out.

    • Re: (Score:2)

      by Nimey ( 114278 )
      Pescadero == Phoenix/Firebird/Firefox, yes?

      • Re: (Score:2)

        by bhima ( 46039 ) *
        Natch

        I hasten to add that Pescadero does not mean Phoenix or Firebird or Firefox in any language that I am aware of. I'm pretty sure Pescadero means 'fisherman' in Spanish or Portuguese. However the link, from the 0.1 build, is permanently forged in my brain and thus pops up when I think Phoenix... which is what I was thinking when I was thinking Linux Distros for a SCO UNIX replacement.

    • Re: (Score:2)

      by Ed Avis ( 5917 )
      What remaining SCO user base?

      Linux used to have some thing called iBCS (Intel Binary Compatibility Standard) where you could run (some? all?) SCO Unix binaries on your Linux/i386 box, but it rotted and iBCS2 was recently pulled from the kernel.

  • Money spent on litigation (Score:5, Interesting)

    by gihan_ripper ( 785510 ) on Tuesday February 05, 2008 @08:57AM (#22305852) Homepage
    For me, one of the interesting facts in the report is the amount they've spent on litigation since Oct 31, 2004: a massive $13,167,000. At least they're honest about their chances of survival: "Our limited cash resources may not be sufficient to fund continuing losses from operations and the expenses of the SCO Litigation."

    • Re: (Score:2)

      by dbIII ( 701233 )
      I wonder how much of that 13 million went to Darl's brother?

      I'm looking forward to the liquidation auction of the SCO assets. I'd like to put in a bid for Darl's ego but I'm afraid the shipping costs would be a fortune.

  • Wow (Score:3, Insightful)

    by davmoo ( 63521 ) on Tuesday February 05, 2008 @08:57AM (#22305854)
    I swear I can hear a fat lady singing...

  • Selling assets? (Score:5, Funny)

    by oahazmatt ( 868057 ) on Tuesday February 05, 2008 @09:02AM (#22305912) Journal

    ...Debtors may sell or otherwise dispose of assets...
    Dibs on the Unix code!

    ...what?

  • Filed their 10K? (Score:3, Funny)

    by sm62704 ( 957197 ) on Tuesday February 05, 2008 @09:03AM (#22305938) Journal
    All they have left is ten thoudand bucks? Dammit Jim, I'm a nerd, not a banker!

    • Re: (Score:2, Informative)

      by SamuraiMike ( 768946 )

      All they have left is ten thoudand bucks? Dammit Jim, I'm a nerd, not a banker!
      According to Wikipedia (http://en.wikipedia.org/wiki/Form_10-K [wikipedia.org]):

      A Form 10-K is an annual report required by the U.S. Securities and Exchange Commission (SEC), that gives a comprehensive summary of a public company's performance.

      • Re: (Score:2)

        by sm62704 ( 957197 )
        I shouldn't have to google to find out what a non-nerd term means, any more than a banker reading "news for greedheads, stiffs that mutter" should have to google to find out what RAM is.

  • Chapter 11 Statistic (Score:3, Interesting)

    by webword ( 82711 ) on Tuesday February 05, 2008 @09:08AM (#22305980) Homepage
    From Maximizing Chapter 11 Success: [bankofamerica.com]

    "A staggering 85% of Chapter 11 Bankruptcy cases never make it to a confirmed plan of reorganization. In fact, lack of cash causes many companies to liquidate within a few weeks after filing."

    Maybe it's not all bad...

    Several companies has come out of it: United, Dow, Texaco, Delta, Toys R Us, Macy's and others.

    • Re: (Score:2)

      by subl33t ( 739983 )
      "United, Dow, Texaco, Delta, Toys R Us, Macy's"

      All those companies had products people actually wanted...

  • What they really mean (Score:3, Interesting)

    by Jason Levine ( 196982 ) on Tuesday February 05, 2008 @09:19AM (#22306054) Homepage

    We have filed a post-effective amendment to a registration statement with the Securities and Exchange Commission ("SEC"), which has been declared effective, covering the potential resale by two of our stockholders of up to 923,019 shares of common stock, or 4.3% of our outstanding common stock. The selling stockholders are bound by certain selling limitations, which limit the number of shares of our common stock that may be sold at one time.


    In other words: "Our outlook reeks to high heaven and we are afraid that people will dump their stock as quickly as possible. In order to slow this down, we're limiting shareholders in how much they can sell at once. Hopefully, this helps keep our stock from going to worthless (instead of the near-worthless that it is right now)."

    The share price right now is 6 cents. It should be interesting to see how low it falls today.

    • As a followup to my own post, SCOX really didn't fall much today. (From 6.5 cents to 6.25 cents.) My two theories are that:

      1. Everyone pretty much knows they're boned anyway. So SCO saying "we're boned" doesn't have much of an impact. It's being greeted with a "Well, Duh!" response rather than a "AAHHH! SELL NOW!" response.

      2. People want to sell, but can't. After all, to sell a share of stock, don't you need to find someone who wants to *buy* that share?

      Given that, SCOXQ's price may have hit a botto

      • Re: (Score:2)

        by djp928 ( 516044 )
        I can't even imagine who still holds shares of SCO. They were de-listed from the NASDAQ and now trade on the OTCBB (over the counter bulletin board, or "pink sheets"). If you held shares of SCO before de-listing, you likely lost everything if you didn't sell (that's generally what happens to holders of common stock once a company goes into Chapter 11).

        But you're right, you can't sell a stock if you can't find someone to buy it from you. For most common stocks traded on the big exchanges, this is almost n

  • Not this again... (Score:5, Insightful)

    by Otter ( 3800 ) on Tuesday February 05, 2008 @09:20AM (#22306064) Journal
    As usual, PJ of Groklaw has a good synopsis...

    We have this story every freaking quarter (and I post the same comment every freaking quarter): 10K's are always written that way, stuffing any imaginable disaster into the text to ward off liability.

    For heaven's sake, nerds, if you don't believe me, at least believe Neal Stephenson's lengthy explanation in Cryptonomicon!

    • Tough shit. (Score:3, Interesting)

      by dj42 ( 765300 )
      This company spent $12M on sales and marketing in '05, and $12M in '06. Meanwhile, RESEARCH AND DEVELOPMENT was $8M / year in 05 and 06.

      In 07 they slashed all spending by about 20-30%.

      They've been losing 20% / year in UNIX revenue since 06, in spite of price increases.

      Obviously, in '07, someone in charge got a realistic expectancy of the company and started cutting cost (as they should), given the fact they had no chance to sustain their business model.

      This is how business works. It is fucking cut-throat, a

    • Re: (Score:2)

      by bark76 ( 410275 )
      So what you're saying is that it's just pining for the fjords...
  • # Springtime for Linux and opensource
      Hackers are smiling and glad.
      Linus can give his code away
      SCO's sinking day by day!

      Springtime for Linux and opensource
      - Winter for mister McBride!
      Springtime for Linux and opensource
      - Coming to the end of the ride... /#
  • Liquidation, the final answer.
  • Slashdot really shouldn't be poking fun here. Sourceforge (the owners of Slashdot) is bleeding money, and makes money now only from from Google AdSense and selling crap on thinkgeek.com. (http://yahoo.brand.edgar-online.com/fetchFilingFrameset.aspx?dcn=0001144204-07-066697&Type=HTML)

    • Re: (Score:2)

      by Secrity ( 742221 )
      Isn't making money from AdSense and Thinkgeek pretty much Sourceforge's business plan? Don't they make money from other ads too? I don't normally see them, but I know that they do have ads beside AdSense.
  • Ding, dong the witch is dead.
  • ...is the quality of the office furniture they'll soon be selling off.

    I could use a good desk or two, and maybe a nice office chair.

  • Septic Services (Score:3, Insightful)

    by rumblin'rabbit ( 711865 ) on Tuesday February 05, 2008 @10:13AM (#22306736) Journal
    I never understood why SCO didn't sell their Unix business very early on during the legal proceedings with IBM. What sane IT manager would buy their product? My suggestion for the world's toughest job is a saleman for SCO - you need a real snappy comeback when your prospective customers ask if SCO is going to sue them like SCO sued their other clients.

    You may as well try to run a catering business under the "Septic Services" brand.

    I can only imagine that there were legal reasons for holding on to the Unix business.

    • Re: (Score:3, Informative)

      by rkhalloran ( 136467 )
      Because (as came out last fall) SCOX didn't own the UNIX code to start with; they only inherited a resellers' agreement and royalty collection business from Santa Cruz. The copyrights (such as they are) to the legacy UNIX codebase stayed with Novell.

      THAT'S what sent the stock into the pink-sheets, and prompted them to file Ch. 11 the day before the trial in Utah to determine how much of their bank balance *should* have gone to Novell as royalties. That trial restarts in April, by which time the SCOundrels

      • That trial restarts in April, by which time the SCOundrels will have probably burned through as much money as possible just for spite.

        The trial will not restart in April because the SCOundrels will file for Chapter 7 protection the day before it starts. But you're right that they will give as much of the remaining cash as possible to their cronies before that date, because they will lose control of the company after it.

  • "And I would have gotten away with it if it weren't for those meddling kids."

  • 1. wildly optimistic legal research

    2. sue everybody including star customers

    3. hunker down for duration of battle to ultimate victory.

    4. crash and burn against wall of common sense and law

    5. ???

    6. liquidation in disgrace.
  • "...die motherf-cker, die motherf-cker..."
  • I wanted a smoking crater not a smoking hole...

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