SCO Goes After DaimlerChrysler

By Steven Vaughan-Nichols  |  Posted 2004-03-03

SCO Goes After DaimlerChrysler

Only hours after The SCO Group Inc. opened a lawsuit against AutoZone Inc. in a Nevada courtroom, SCO sued DaimlerChrysler AG in a Michigan state court for Unix contract violations and Linux copyright issues.

Darl McBride, SCOs CEO said on Wednesday that SCO will enforce its legal contract and copyright rights in the United States and around the world. According to McBride, DaimlerChrysler is a licensee of Unix System V source code and the company had refused SCOs request to certify that the source code was protected so that none of it could have been stolen away into Linux. This refusal resulted in todays legal action.

McBride said that "SCO had alerted DaimlerChrysler in December of last year that they needed to certify their code but DaimlerChrysler did not respond." Further, for SCO the action was simply a matter of "protecting its contract and copyright rights," he said, adding that DaimlerChrysler was only one of many companies that SCO demanded Unix source code certification from.

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

Mark Heise, a partner at Boies, Schiller & Flexner LLP and SCOs leading outside counsel, added that SCO is committed to its right to enforce its System V customer agreements. He added that while SCO is deliberately taking its time in making decisions on which Linux users to sue, in the future there would not be months of delays between lawsuits.

McBride said that AutoZone, another former SCO customer, also hadnt responded to SCOs requests. He characterized these two actions as different kinds of suit: DaimlerChrysler, with its source-code agreement, and AutoZone, which had been a SCO OpenServer user.

With the AutoZone complaint, SCO detailed in a long list the particular parts of Unix the company alleges have been used in Linux without its permission.

Section 19 of SCOs AutoZone complaint reads: "The Copyrighted Materials include protected expression of code, structure, sequence and/or organization in many categories of UNIX System V functionality, including but not limited to the following: System V static shared libraries; System V dynamic shared libraries; System V inter-process communication mechanisms including semaphores, message queues, and shared memory; enhanced reliable signal processing; System V file system switch interface; virtual file system capabilities; process scheduling classes, including real time support; asynchronous input/output; file system quotas; support for Lightweight Processes (kernel threads); user level threads; and loadable kernel modules."

When asked if it mattered that Novell is still claiming that it owns the copyright to Unix System V—and despite the fact that SCO is suing Novell over this claim—McBride insisted that it didnt matter. When pushed in the teleconference with press and analysts, he said the courts would decide if that was relevant.

Next Page: What Will SCOs Customers Say?

What Will SCOs Customers


Thomas C. Carey, chairman of the business practice group at Boston-based Bromberg & Sunstein LLP, a firm specializing in intellectual property litigation and business law, agreed with McBride.

"I dont think that the Novell lawsuit will directly affect the customer, but the IBM lawsuit will. The customer will likely try to have its case stayed pending the outcome of the IBM lawsuit. Or it may seek to have its case consolidated with the IBM lawsuit so as to ride IBMs coat-tails throughout the litigation."

Some on the teleconference wondered if SCO suing former customers would interfere with the companys capability to gain new customers.

McBride furiously replied that until SCO started to protect its IP rights, it had no future business since its Unix products had to compete against no-cost Linux distributions. To McBride, SCO had to become a litigious company in order to survive.

Carey observed that if SCO is to make any money from its intellectual property, "this move is absolutely necessary if SCOs licensing program is going to gain any momentum. The CFO of the Linux user [company] has to see that there is a potential cost to doing nothing in response to SCOs threats."

Linus Torvalds, Linuxs chief creator, offered another take on SCOs latest moves. In an e-mail exchange he said: "What should you take away from this? Never, ever, EVER, enter into any agreement with SCO. You will be sued, whether you did anything wrong or right."

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