Judge Slaps Down SCOs DaimlerChrysler Suit

By Steven Vaughan-Nichols  |  Posted 2004-07-21

Judge Slaps Down SCOs DaimlerChrysler Suit

SCO suffered its first major defeat Wednesday in its legal wars against Linux-using companies, when DaimlerChrysler was granted all of the important points in its motion to dismiss SCOs case.

Judge Rae Lee Chabot of Oakland County Circuit Court in Michigan all but dismissed The SCO Group Inc.s case after a hearing, which, according to at least one eyewitness, took only about 20 minutes.

The judge ruled, according to the witnesss account, that "Summary disposition is granted except on the matter of breach of section 2.05, in that DaimlerChrysler did not submit its response in a timely manner. All other claims were dismissed."

The only thread of hope Lindon, Utah-based SCO has if it decides to pursue the case in this court is to seek damages for DaimlerChryslers delaying its response to SCOs demands.

SCO had been arguing that automobile powerhouse DaimlerChrysler AG, as a licensee of Unix System V source code, had refused SCOs request to certify that the Unix source code was protected so that none of it could have been stolen away into Linux.

DaimlerChrysler was only one of about 1,500 companies with Unix licenses that SCO sent letters to in December 2003, demanding that they show compliance in safeguarding the Unix source code within 30 days. DaimlerChrysler eventually did this, but took 110 days to do so.

At the time that SCO filed its case, SCO CEO Darl McBride said, "SCO had alerted DaimlerChrysler in December of last year [2003] that they needed to certify their code, but DaimlerChrysler did not respond." Further, he said that for SCO, the action was simply a matter of "protecting its contract and copyright rights."

McBride also made it clear then that SCO was not accusing DaimlerChrysler of actually sharing the code with Linux developers, but rather that DaimlerChrysler had not certified that the System V code was properly protected as per its agreement with AT&T and its successor to Unixs IP (intellectual property) rights, SCO.

DaimlerChrysler struck back against SCO in April with its just-granted motion to dismiss. The automobile maker categorically denied almost all of SCOs claims against it. Moreover, DaimlerChrysler contended that SCO wasnt a party to its Unix license agreements, "and therefore the plaintiff may lack standing to sue."

In addition, DaimlerChrysler said SCO lacks any standing to sue it because Novell has expressly requested that SCO waive any rights it might have to enforce this Unix license. But in the actual case, since DaimlerChrysler did certify that it had kept its Unix source code safe, most of these points were moot.

Read more here about Novells legal battle with SCO.

Many of SCOs points also were moot, since its case was founded not on DaimlerChrysler actually contributing Unix code to Linux, but on the possibility that Unix source code had not been safely kept.

"The outcome of the case wasnt unexpected, since they finally did certify, so the main point of the lawsuit was now moot," said Blake Stowell, director of communications at SCO. "Were glad that DaimlerChrysler finally certified the software agreement that they entered into and sorry that they waited until after we had filed litigation against them."

Next Page: SCOs Stowell says its cases "may appear similar but are actually very different."

Different Cases

Looking ahead, Stowell said he doesnt see SCO pursuing the case further. But, he added, "I think the company is considering its legal options since the judge allowed for some limited discovery based on their delay in certifying." At the same time, Stowell said, "Theres an important distinction between this case and our other cases. This is not a setback against SCOs Linux copyright cases.

"Its important to understand that the four cases SCO has in litigation may appear similar but are actually very different, so the results of this case doesnt have any effect on the cases with AutoZone, Novell, Red Hat and IBM," Stowell said.

AutoZone recently won a brief stay in its copyright case with SCO. Click here to read more.

A DaimlerChrysler spokeswoman expressed satisfaction about the ruling. "We are pleased with the judges ruling, and we look forward to finally resolving the one open issue," DaimlerChrysler spokeswoman Mary Gauthier said in a statement.

Still, while this cases resolution did not directly touch on SCOs Linux litigation, Allonn Levy, an attorney with Hopkins & Carley in San Jose, Calif., thinks it certainly isnt going to help SCO any.

"Todays dismissal of most of SCOs suit against DaimlerChrysler is the latest in a series of very public debacles in SCOs massive litigation strategy," Levy said. "Commencing with its suit against industry behemoth IBM in March 2003, SCO has launched a series of aggressive litigation efforts apparently aimed at undermining the success of the Linux operating system—long viewed as a rival to SCOs Unix OS."

"While the strategy reportedly had some initial success, mostly in the PR arena, as the cases have unfolded, SCO has been beset by serious setbacks in the legal arena," Levy said. "Todays ruling is perhaps the most serious setback SCO has suffered. The court in Michigan held a relatively short hearing before ruling from the bench that the majority of SCOs claims should be thrown out."

"SCOs purpose in pursuing a very public, aggressive litigation strategy, would seem to be to undermine the publics confidence in the rival Linux operating system by suggesting that it contains infringing materials," he said. "Ironically though, if it continues to suffer such severe setbacks, it may instead succeed in permanently validating Linux by publicly demonstrating its legitimacy."

Check out eWEEK.coms Linux & Open Source Center at http://linux.eweek.com for the latest open-source news, reviews and analysis.

Be sure to add our eWEEK.com Linux news feed to your RSS newsreader or My Yahoo page

Rocket Fuel