SCO Insists Action Against Linux Customer Is Imminent

An SCO spokesperson says that speculation of the SCO-Novell copyright dispute halting a Linux customer lawsuit will be proven wrong.
The SCO Group failed to file a major copyright case against a Linux customer by the end of February as promised but will take action very soon, a SCO spokesman said.

On Monday, the spokesman dismissed speculation that the embattled Unix software company had pulled the plug on a plan to file a major copyright infringement case against a Linux user because Novell challenged SCO's copyright ownership of Unix.

"They will soon be proven wrong," said Blake Stowell of SCO, alluding to open-source advocates who say the potential case is stalled. "All I can say on the end-user lawsuit front is stay tuned. You'll be hearing from SCO on this topic very soon."

The news came as SCO announced that the Houston-based hosting division of service provider Everyone's Internet has signed a site license that allows the use of SCO IP in binary form for all of its Web servers running Linux.

SCO claims that it has signed IP licenses with a "handful" of enterprise customers and a few small to midsize businesses since launching its IP licensing program last August. When pushed, the spokesman said SCO had signed SCOsource licenses with "more than two" enterprise customers.

The SCO IP license, which was expanded last month to cover worldwide licensing, was created to absolve Linux customers of any potential litigation and generate revenue for SCO.

With the vast majority of Linux customers rejecting that effort, however, SCO in December sent cease-and-desist letters to select Fortune 1000 companies charging them with illegally using more than 65 SCO-owned Application Binary Interfaces (ABIs) without permission.

It was the second warning letter SCO sent out to Linux customers since launching its battle against Linux last spring.

Many in the open-source camp maintain that SCO has not yet proved its case in court and customers should not be forced to pay for licenses that are unnecessary.

SCO's case against Linux began last March when it filed a major contract violation suit against IBM and claimed that Big Blue improperly donated Unix code to the Linux kernel. SCO has since amended that lawsuit to focus on copyright infringement claims and upped the damages sought to more than $5 billion. However, the case is still pending and not due to go to trial until 2005.

The legal drama took another turn late last year when Novell--which originally sold much of the Unix System V code to SCO--challenged SCO's claims to full copyright ownership. After Novell registered several claims with the U.S. Copyright Office, SCO returned fire with a lawsuit against Novell claiming Novell made false and misleading public claims.

While some observers say the legal dispute over the copyrights precludes SCO from filing a case against a Linux customer until ownership is resolved, others--including SCO--say that's not the case.

On Monday, SCO sharply denied that company executives changed their minds about filing against a customer and will take action very soon. "We are moving forward on all fronts," Stowell said.

Several commercial Linux companies including Hewlett-Packard, Novell and Sun Microsystems have offered customers indemnification from the legal costs of a potential SCO copyright case. IBM and Red Hat have not offered such protection. However, IBM contributed to an Open Source Development Labs Fund set up late last year designed to cover the cost of litigation, and Red Hat offered up an IP warranty that guarantees the company will rewrite potentially infringing code at no cost to customers to remove their legal liability.

Editor's Choice
Brian T. Horowitz, Contributing Reporter
Samuel Greengard, Contributing Reporter
Nathan Eddy, Freelance Writer
Brandon Taylor, Digital Editorial Program Manager
Jessica Davis, Senior Editor
Cynthia Harvey, Freelance Journalist, InformationWeek
Sara Peters, Editor-in-Chief, InformationWeek / Network Computing