York Proposes to Take Over SCOs Unix/Linux Lawsuits
If York is allowed to buy SCO there's no end in sight for SCO's Unix/Linux lawsuits.York Capital Managements proposed Asset Purchase Agreement and its associated credit agreement for SCO make it clear that if the bankruptcy court lets York buy SCO, that York will be bankrolling SCOs continued lawsuits against Novell, IBM and other Linux-using companies. Groklaw published the APA and its associated credit agreement during the last few days. The most interesting aspects of the proposed deal are in the credit agreement. York, a private equity firm, is offering a complex purchase agreement for SCO. While the total amount of the deal comes to $36 million, a close look reveals SCO would get $10 million in cash and what amounts to a $10 million line of credit to use to continue its legal fights with Novell and IBM.
This $10 million "Litigation Credit Facility" is specifically so that SCO can fund the "Specified Litigation." And what is that? The APA (PDF Link) spells it out: "The IBM litigation and the Novell Litigation and all appellate, supplemental and/or collection proceedings related thereto." As Pamela Jones, Groklaws editor, aptly described this proposed SCO bankruptcy bailout, "This isnt a reorganization plan. Its York funding SCOs litigation lottery."