Legal Strings Remain in Novell-SCO Group Tussle over Unix

Although open-source advocates around the world celebrated a court victory March 30 when a Salt Lake City jury confirmed that the licensing rights to the Unix operating system belong to Novell and not to the SCO Group, the nearly 7-year-old legal dispute over IP is not yet over.

In its lawsuits, SCO Group, which filed for bankruptcy protection in 2007, had been seeking about $251 million in Unix license fees plus unspecified damages.

There are still some dangling legal strings that need to be trimmed, and those won't happen for at least a few weeks-barring any more appeals, of course, by the Lindon, Utah-based SCO Group. 

SCO Group, under a contract first signed with Novell back in 1995, makes its own Unix-based server and provides maintenance services for its installed base. Over a number of years, the company came to claim that it not only owned the Unix code for licensing purposes but also that Linux is a derivative of Unix and should also be considered licensable.

SCO Group's long-term goal was to find a way to gain licensing control for its SCOsource product over the Linux operating system, which is modeled after the original Unix code created at AT&T's Bell Laboratories in the early 1970s.

Several variations of Linux-including Red Hat, Novell SUSE, Ubuntu and CentOS-now run most of the servers in enterprise business and Internet data centers, and theoretically there would be huge proceeds from the licensing of all those millions of servers.

However, Linux-the Unix-like operating system created by Linus Torvalds-is separate open-source software governed by the international GNU Public License.

When it allowed SCO Group to take over maintenance of customers using Unix in their enterprise IT systems in 1995, Novell never sold the ownership rights to the operating system to SCO, the jury said.

However, there are still two issues that the judge needs to decide. These involve the concept that the copyrights for Unix should be transferred to SCO Group, based on the 1995 agreement it signed with Novell, which SCO Group is still litigating.

The jury verdict on March 30 was unanimous in ruling that the copyrights did not transfer to SCO Group at any time from Novell.

The judge will review the briefs from both sides in SCO Group's claim for specific performance (on whether SCO Group should own the Unix copyrights) on April 16. Novell, of course, is hopeful that the judge will be heavily influenced by the jury verdict and dismiss the claim, although SCO Group is expected to appeal if necessary.

If SCO Group were to lose that part of the case following appeal, then the copyright threat over Linux would be removed.

The second part of the case involves IBM and Red Hat. Former U.S. District Judge Edward Cahn, the trustee for SCO's bankruptcy filed in Delaware, said in a statement that "SCO intends to continue its lawsuit against IBM, in which the computer giant is accused of using Unix code to make the Linux operating system a viable competitor, causing a decline in SCO's revenues.

"The copyright claims are gone, but we have other claims based on contracts," Cahn said.

'Ton of skepticism' about Unix in Linux

Morrison & Foerster attorney Michael Jacobs represented Novell at trial. Jacobs, who heads the firm's patent litigation practice, led the trial team.

"If we continue on the path we're on, then Linux users can rest assured that they are free from claims by SCO," Jacobs told eWEEK. "But this was not a trial about whether there is Unix code in Linux. The closest we got to that was that SCO talked about the presentations they made to prospective licensees to try to persuade them that there was 'Unix in Linux.'
 
"Nonetheless, we believe we demonstrated at trial that there was a ton of skepticism as to whether there was any Unix in Linux, and that was one reason SCO's licensing campaign failed."

The legal avenues for SCO Group in its attempt to wrestle ownership rights of Unix-and over Linux, to an extent-from Novell are waning.

"SCOsource is dead in the water now from this verdict," wrote Groklaw founder and Editor Pam Jones in her blog March 30. Jones has been following this case for the full seven years and was moved to start Groklaw because of the issue of corporate control over open-source software.

"But don't forget, IBM has counterclaims. So does Red Hat have claims, if they are interested in pursuing them any more. Even in this Novell trial, there are some issues the judge has yet to decide. This saga is not finished."