Is SCO Down for the Count This Time?

The company may be down after the court's ruling that it lacks "competent evidence" in its case against IBM, but analysts and lawyers say it's too early to tell how it will all end up.

At first glance, it appears that The SCO Groups case against IBM for Linux/Unix intellectual property right violations is all but over, after the judge said Tuesday that the court hasnt seen any hard evidence to support SCOs claims.

U.S. District Judge Dale A. Kimball wrote Tuesday, "It is astonishing that SCO has not offered any competent evidence to create a disputed fact regarding whether IBM has infringed SCOs alleged copyrights through IBMs Linux activities."

But analysts and lawyers disagree on whether SCO is down to its last strike.

While Lawrence Rosen, an open-source legal expert and partner in the Ukiah, Calif.-based law firm Rosenlaw & Einschlag, described the latest developments as being merely "the delay of the inevitable," others dont see it as being such an open-and-shut case.

"Yes, this is very damning," said Thomas Carey, chairman of the business practice group at Boston-based Bromberg & Sunstein LLP. "Judge Kimball has seen all of the evidence presented to date, and has concluded that there is no there there.

"Unfortunately for IBM, Judge Kimball leaves open the possibility that intermediate forms of the code found in AIX may present the missing link between Unix and Linux," Carey said.

"Thus, substantial additional discovery will take place. There is plenty of risk left for IBM: the risk that the judge may misinterpret code similarities that should not really amount to infringement; the risk of confusion at trial; the risk that the judge may commit reversible error, causing the whole case to be retried; and the risk that the case may turn on some obscure point of law that is essentially irrelevant to the bona fide nature of Linux," he said.

/zimages/5/28571.gifClick here to read about a minor win for SCO in the case, when IBM was ordered to turn over the source code of "all versions and changes" of IBMs AIX and Dynix Unix operating systems.

Stacey Quandt, senior business analyst for the Robert Frances Group, said the judges decision not to dismiss SCOs case at this time reflects his desire to avoid a lengthy appeals process.

"It is clear that the judge wants to avoid an appeal and is hence enabling both IBM and SCO to complete their discovery process," Quandt said. "This means IBMs hope of the judge granting summary judgment, while still possible, will take longer to achieve."

Kelly Talcott, a partner with international law firm Kirkpatrick & Lockhart Nicholson Graham LLP, said Kimballs statement about a lack of evidence is not the only factor to consider in the case.

"The judge made it clear that he has seen no evidence to date that IBM has infringed any SCO copyright relating to Linux. Given SCOs numerous public statements to the contrary, that is certainly a problem for SCO going forward. But its not the whole story here," Talcott said.

"The judge is now raising the SCO breach-of-contract claim. In fact, SCOs breach-of-contract claim is one of the main roadblocks that Judge Kimball cites as standing in the way of summary judgment in IBMs favor. Given the apparent lack of evidence to date of direct infringement, it may be that SCOs strongest claim turns out to be its breach-of-contract claim," he said.

Next Page: "A very bold move or surefire suicide."