[Infowarrior] - SCO loses again - Linux safe for now

[Richard Forno]

More @ Growkaw:  http://www.groklaw.net/article.php?story=20100330152829622

SCO loses again: jury says Novell owns UNIX SVRX copyrights

By Ryan Paul | Last updated about 4 hours ago
       
http://arstechnica.com/open-source/news/2010/03/sco-loses-again-jury-says-novell-owns-unix-svrx-copyrights.ars

The SCO Group was dealt a serious, potentially fatal blow today in its courtroom battle against Linux. The jury in the trial between SCO and Novell has issued a verdict affirming that Novell is the rightful owner of the UNIX SVRX copyrights. This verdict will make it difficult for SCO to continue pursuing its baseless assault on the open source operating system.

The SCO saga began in 2003 when the company claimed that Linux is an unauthorized derivative of UNIX. SCO filed a lawsuit against IBM, alleging that Big Blue misappropriated UNIX code and included it in the Linux kernel. Although SCO repeatedly claimed to have compelling evidence to support its accusations, the company has yet to provide proof in the seven years since. Internal SCO memos that came to light during the discovery process of SCO's conflict with IBM revealed that SCO's own internal code audits did not identify any evidence infringement.

The dispute over infringement and misappropriation was put on hold when Novell issued a public statement in 2004 asserting that it is the rightful owner of the SVRX copyrights and never sold the IP to SCO. The 1995 sale agreement, says Novell, gave SCO the right to sell SVRX licenses on behalf of Novell, but did not transfer ownership of the copyrights. As such, Novell claims that SCO does not have proper standing to pursue litigation pertaining to alleged copyright infringement.

The matter of ownership was adjudicated in a bench trial that concluded in 2007 when Judge Dale A. Kimball ruled in favor of Novell. SCO's stock value plummeted and the company appeared to be on the brink of annihilation. SCO managed to avoid oblivion by engaging in a series of stalling tactics and pursuing a number of ill-fated reorganization attempts during the bankruptcy proceedings in order to avoid liquidation.

SCO finally got a chance to make its case before a jury when Kimball's ruling was overturned by the US Court of Appeals for the Tenth Circuit last year. The jury heard detailed arguments from the legal representatives of SCO and Novell. SCO argued that the SVRX copyrights, which were not included in the original agreement, were added later in an amendment. They claim that a term sheet associated with the deal shows that the SVRX IP was intended to change hands. Novell argued that the term sheet is irrelevant, as the asset purchase agreement itself did not transfer the SVRX copyrights.

The jury heard the closing arguments on Friday and reconvened this morning to deliberate. The jurors were required to reach unanimous decision on the matter of ownership. As the burden of proof was on SCO, the jurors were instructed to issue a verdict in SCO's favor only if SCO presented clear and convincing evidence to support its position.

SCO failed to prove its case, as the jury declared that Novell is the rightful owner of the SVRX copyrights. Novell expressed satisfaction with the verdict in a statement today. SCO has not responded to our request for comment.

"Novell is very pleased with the jury's decision confirming Novell's ownership of the Unix copyrights, which SCO had asserted to own in its attack on Linux," a Novell spokesperson said. "Novell remains committed to promoting Linux, including by defending Linux on the intellectual property front."

SCO cannot continue pursuing its infringement litigation against IBM or assorted Linux users because it doesn't own the copyrights that it claims are infringed by Linux. Even if the jury had ruled in SCO's favor, the overwhelming lack of evidence of infringement would still likely make it impossible for SCO to achieve victory in its litigation campaign. It's unclear if the company will be able to evade liquidation following this latest failure in court.