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DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Saturday, May 01 2004 @ 06:07 AM EDT

Here, as text, is DaimlerChrysler's Motion for Summary Dismissal (p. 9 of the PDF), the Memorandum in Support of its Motion (p. 11 of the PDF) and the following exhibits, the Affidavit of Paul Eichbauer (p. 30 of the PDF), the letter from Susan J. Unger to Bill Broderick (p. 33 of the PDF), and the letter from Norman Powell to USL (p. 35 of the PDF). Our thanks, once again, to the indefatigable Steve Martin for this text version.

The most extraordinary sentence is this one: "SCO did not contact DaimlerChrysler after sending the SCO Letter and prior to initiating this lawsuit." That explains why SCO didn't know that DC no longer uses the licensed software and hasn't for 7 years now, which makes it pointless for SCO to sue them for breach of the license agreement. It doesn't explain why the lawyers brought a lawsuit without finding out if the facts justified an action. DC, I note, reserves the right to assert "that SCO has intentionally filed a meritless lawsuit for purposes of restraining competition".

I see another possible explanation. SCO had announced publicly that it would sue someone within a certain time frame. McBride said they would be suing by February 18, if you recall his speech at Harvard. We know from the metadata in the complaint, written in Microsoft Word, that SCO apparently intended to sue a bank, the Bank of America, instead of DC, but at the last minute switched to DC instead, on February 18th, as a matter of fact:

"In the case of SCO's lawsuit against DaimlerChrysler, the Word document identified Bank of America as a defendant until Feb. 18--at 11:10 a.m., to be exact. The location for filing the suit also was switched from Bank of America's principal operations in California to Michigan, DaimlerChrysler's home state, on Feb. 27."

Remember the DMCA action that never was? For whatever reason, there was a last-minute change of plans and strategy, and it may simply have been too late to prepare the DC case properly and still come even close to meeting their deadline to file, a self-imposed deadline, but still one that they may have felt pressured to try to meet as soon as they could, after February 18 came and went with no lawsuit.

"In the original version that listed Bank of America as a defendant, the focus was copyright infringement and violations of the Digital Millennium Copyright Act, which would be the domain of the federal courts.

"SCO also cited alleged copyright infringement in the suit it filed in federal court Tuesday against AutoZone, but it did not include violations of the DMCA. In the original version identifying Bank of America as a defendant, the document also included these allegations against the bank and Linux developers, including leading Linux figure Linus Torvalds:

  •   'Defendant acquired a license from IBM to use UNIX/AIX on or about December __, 2003 the ("BA UNIX/AIX License"). At the time of acquiring the BA UNIX/AIX License, Defendant knew or should have known: (a) that IBM’s license to distribute UNIX/AIX had been terminated by SCO pursuant to the UNIX/AIX Termination Notice and (b) that IBM’s distribution to it of UNIX/AIX software improperly included use of the UNIX Release 3.2 Copyrighted Materials

  •  '(C)ertain of plaintiff's copyrighted software code has been materially or exactly copied by Linus Torvalds and/or others for inclusion into one or more distributions of Linux with the copyright management information intentionally removed.'

"In seeking relief from the courts, the original version of the document also said that it sought: 'impounding all Linux software products in the custody or control of Defendant through the pendency of these proceedings;' and 'statutory damages under the Third Cause of Action in a sum not less than $2,500 and not more than $25,000 for each and every copy and/or distribution of Linux made by Defendant.' This request was not made in the AutoZone or DaimlerChrysler suits."

Something happened that caused them to switch strategy at the last moment. This may have left them with no lawsuit ready to file for whatever reason and a public promise to sue within a certain time frame. Might that explain this ill-planned action? I have no inside knowledge, so it's just a guess, but it seems to match the results.

SCO announced on March 1 that, after consulting with the Boies law firm, it would sue somebody the next day. The next day, they sued AutoZone. Blake Stowell said to expect a second lawsuit, beside the one against AutoZone, by the end of the day "against a current Unix licensee." I thought McBride was just yarning when he told Dan Farber that the defendant he would be suing the day after that interview didn't know it was going to be sued unless it was a palm reader. He went on to say something that seems to contradict himself:

"What it comes down to is, we have had multiple communications with a handful of companies that have kind of come down to the finish line here with where we will start with the end user litigation. And so when I say they won't know it's coming -- they will absolutely know, we have been in communication with them, we've gotten to the point where you know we are where we are now, and now it's time to move to the litigation part of the enforcement."

Normally there is some interaction between the lawyers to see if a resolution will be possible that will make legal action unnecessary. Here, according to DC, SCO just sent the letter in December and bang, the lawsuit followed in March, without SCO contacting DC in the interim. It's all very , very strange. DC points that out in its Memorandum in Support of its Motion for Summary Dismissal. They haven't used the licensed software in seven years, they state, but even if they were still using it, SCO has no right to ask them about using Linux. They had the right, under the license, to ask for three things and three things only, the location, type and serial number of all CPUs under the license, a statement that the licensee has reviewed the use of the licensed software, and a statement that the software was being used solely on designated CPUs. Those terms, they say, are clear and unambiguous. By making such a specific list, the license excluded any other requirements, and so that is why DC didn't furnish SCO with the demanded Linux Certifications, DC says.

DC asserts that this is one of those rare cases that can be dismissed as a matter of law. "This case presents no issue on which reasonable minds might differ." I discern they don't know SCOfolk as well as we do. "The unambiguous terms of Section 2.05 of the License Agreement are susceptible to only one reasonable interpretation," the Memorandum states, "and bar SCO's claim for breach and declaratory judgment as a matter of law. Moreover, because the License Agreement's terms are unambiguous, no amount of discovery would enable SCO to develop a record that would leave open the issue of breach. Accordingly, this Court should grant summary disposition in favor of DaimlerChrysler on SCO's claims."

Besides, the license says if there is a transfer, they were to be notified, and they never got any notice of any transfer to SCO. Therefore, they challenge SCO's right to bring the lawsuit. That's why they sent the certification, stating that they don't use the software at all any more, not to SCO but to USL. And on top of that, the license didn't require even a proper certification be provided within any specified time frame, let alone within 30 days as demanded by SCO.

Then it talks about a contract construction term called "expresso unius est exclusio alterius." This is a principle that if there is a clear setting forth of one thing, it implies the exclusion of any other things. This case explains it as meaning "a maxim of statutory interpretation meaning that the expression of one thing is the exclusion of another." What do they mean by that? Well, here is how I understand it: suppose we enter into a contract and I say that in return for your money, I will provide you with one item, say a necklace. You can't then sue me saying that the contract meant I have to give you matching earrings too. If you wanted matching earrings, you should have added it to the list in the contract. The specific designation of a necklace for your money precludes the earrings. You can't argue that the contract must have meant the earrings too, because the contract specified a necklace. If the contract said in return for your money I was to provide you with jewelry, then you might have a case. Similarly, by listing three specific things in a proper certification request, DC says, it precluded any additional items, such as a Linux Certification.

*********************************************

STATE OF MICHIGAN
IN THE CIRCUIT COURT FOR THE COUNTY OF OAKLAND

THE SCO GROUP, INC.,

Plaintiff,

vs.

DAIMLERCHRYSLER CORPORATION,

Defendant.
Civil Action No. 04-056587-CKB

Honorable Rae Lee Chabot

Joel H. Serlin (P20224)
Barry M. Rosenbaum (P26487)
SEYBURN, KAHN, GINN, BESS AND
SERLIN, P.C.
Attorneys for Plaintiff
[address]
[phone]
James P. Feeney (P13335)
Thomas S. Bishoff (P53753)
Stephen L. Tupper (P53918)
DYKEMA GOSSETT PLLC
Attorneys for DaimlerChrysler Corporation
[address]
[phone]

DAIMLERCHRYSLER CORPORATION'S MOTION FOR SUMMARY DISPOSITION

Defendant DaimlerChrysler Corporation ("DaimlerChrysler"), through its counsel, Dykema Gossett PLLC, moves for summary disposition of Plaintiff The SCO Group, Inc.'s Complaint pursuant to MCR 2.116(C)(10).

In support of this Motion, DaimlerChrysler relies upon the facts and law set forth in its Memorandum of Law In Support Of Motion For Summary Disposition, filed contemporaneously herewith, and its exhibits, the pleadings and other documents on file with the Court, and all matters of which the Court may take judicial notice.

WHEREFORE, Defendant DaimlerChrysler Corporation respectfully requests that this Court grant this Motion and enter an order, pursuant to MCR 2.116(C)(10), dismissing Plaintiff The SCO Group, Inc.'s Complaint in its entirety with prejudice.

  Respectfully Submitted,
DYKEMA GOSSETT PLLC
    (signature)    
James P. Feeney (P13335)
Thomas S. Bishoff (P53753)
Stephen L. Tupper (P53918)
Attorneys for Defendant
DaimlerChrysler Corporation
[address]
[phone]

Of Counsel:

HALE and DORR LLP

Mark G. Matuschak
Michelle D. Miller
[address]
[phone]

Robin L. Alperstein
[address]
[phone]


STATE OF MICHIGAN
IN THE CIRCUIT COURT FOR THE COUNTY OF OAKLAND

THE SCO GROUP, INC.,

Plaintiff,

vs.

DAIMLERCHRYSLER CORPORATION,

Defendant.
Civil Action No. 04-056587-CKB

Honorable Rae Lee Chabot

Joel H. Serlin (P20224)
Barry M. Rosenbaum (P26487)
SEYBURN, KAHN, GINN, BESS AND
SERLIN, P.C.
Attorneys for Plaintiff
[address]
[phone]
James P. Feeney (P13335)
Thomas S. Bishoff (P53753)
Stephen L. Tupper (P53918)
DYKEMA GOSSETT PLLC
Attorneys for DaimlerChrysler Corporation
[address]
[phone]

DAIMLERCHRYSLER CORPORATION'S MEMORANDUM OF LAW
IN SUPPORT OF ITS MOTION FOR SUMMARY DISPOSITION

Defendant DaimlerChrysler Corporation ("DaimlerChrysler") submits this Memorandum of Law in Support of its Motion for Summary Disposition pursuant to Michigan Court Rule ("MCR") 2.116(c)(10).

This case presents the rare circumstance where summary disposition at the initial state of the litigation is not only appropriate, but required. The SCO Group, Inc. ("SCO") alleges a sole cause of action for breach of contract and declaratory judgment. However, the two documents that SCO itself attaches to the complaint in ostensible support of its claim instead defeat the claim as a matter of law. The documents --- a letter from SCO seeking a certification it says DaimlerChrysler is required to provide pursuant to a license agreement, and the license agreement itself --- show that there is no genuine issue of material fact as to whether DaimlerChrysler breached the agreement. The license agreement delineates, in unambiguous terms, what the certification must include, and by those plain terms, DaimlerChrysler has no contractual duty to provide the information that SCO demands in its letter. In addition, DaimlerChrysler has provided SCO with the only certification required under the license, demonstrating that DaimlerChrysler is not even using and has not used the licensed software for more than seven years. Accordingly, there is no genuine issue of material fact, and SCO's claim fails as a matter of law.

STATEMENT OF UNDISPUTED FACT

  1. In 1988 Chrysler Motors Corporation ("Chrysler"), and AT&T Information Systems, Inc. ("AT&T-IS") entered into the AT&T Information Systems, Inc. Software Agreement, Agreement No. SOFT-01341 (the "License Agreement") for the license of certain AT&T-IS software products. See Complaint ("Cmpl.") Exhibit A (License Agreement) at 1.

  2. DaimlerChrysler is Chrysler's successor-in-interest to the License Agreement. See Affidavit of Paul R. Eichbauer ("Eichbauer Aff.") (attached hereto as Exhibit A) Exhibit 1.

  3. The software products that AT&T-IS licensed to DaimlerChrysler pursuant to the License Agreement included "UNIX System V Release 3.0 Source Code" and certain modifications and certain derivative works based thereon. See Compl. Exhibit A (License Agreement) § 2.01 and attached Schedule at 4, 5, 6.

  4. Section 2.05 of the License Agreement provides:
    On AT&T-IS's request, but no more frequently than annually, Licensee shall furnish to [AT&T-IS] a statement, certified by an authorized representative of Licensee, listing the location, type and serial number of all Designated CPUs hereunder and stating that the use by Licensee of Software Products subject to this Agreement has been reviewed and that each such Software Product is being used solely on such Designated CPUs (or temporarily on back-up CPS) for such Software Products in full compliance with the provisions of this Agreement.
    Compl. Exhibit A (License Agreement) § 2.05 (emphasis added).

  5. SCO claims to be the successor to AT&T-IS's rights under the License Agreement. See Compl. ¶ 19 and Exhibit B (Letter from Bill Broderick to Chrysler Motors Corp. dated December 18, 2003 ("SCO Letter")).

  6. On or about December 18, 2003, SCO sent a letter addressed to the "Chief Executive Officer of Chrysler Motors Corporation" in Highland Park, Michigan purporting to seek a certification from DaimlerChrysler pursuant to Section 2.05 of the License Agreement. See Cmpl. Exhibit B (SCO Letter).

  7. However, the SCO Letter actually demanded that written certification pursuant to Section 2.05 "must include certifications that:

    1. You have held, at all times, all parts of the Software Products (including methods and concepts) in confidence for SCO.

    2. You have appropriately notified each employee to whom you have disclosed the software products, and taken steps to assure that such disclosure was made in confidence and must be kept in confidence by such employee. Please provide evidence of your compliance with this obligation. This evidence may include, but not be limited to, nondisclosure agreements, employee policies or manuals, or other such evidence of compliance.

    3. Neither you nor your employees with access to the Software Products have contributed any software code based on the Software Products for use in Linux or any other UNIX-based software product.

    4. Neither you or you employees have used any part of the Software Products directly for others, or allowed any use of the Software Products by others, including, but not limited to use in Linux or any other UNIX-based software product.

    5. Neither you nor your employees have made available for export, directly or indirectly, any part of the Software Products covered by this Agreement to any country that is currently prohibited from receiving such supercomputing technology, including Syria, Iran, North Korea, Cuba, and any other such country, through a distribution under the General Public License for Linux, or otherwise.

    6. Neither you nor your employees have transferred or disposed of, through contributions to Linux or otherwise, any part of the Software Product.

    7. Neither you nor your employees have assigned or purported to assign, any copyright in the Software Products to the General Public License, or otherwise for use in Linux or another UNIX- based software product."

    Id. at 2-3 (the "Linux Certifications").

  8. The SCO Letter also demanded "written certification ...within 30 days of receipt of this letter." Id. at 2.

  9. By its terms, Section 2.05 of the License Agreement does not require DaimlerChrysler to respond to the Licensor's request for certification within 30 days of receipt. See Cmpl. Exhibit A (License Agreement) § 2.05.

  10. No other provisions of the License Agreement imposes a requirement that DaimlerChrysler respond to a certification request within 30 days of receipt of such request. See generally Cmpl. Exhibit A (License Agreement).

  11. Section 2.05 of the License Agreement specifies the required contents of a proper certification:

    1. a list of the location, type and serial number of all Designated CPUs under the License Agreement:

    2. a statement that the Licensee has reviewed the use of Software Products subject to the License Agreement; and

    3. a statement that "each such Software Product is being used solely on such Designated CPUs (or temporarily on back-up CPS) for such Software Products in full compliance with the provisions of this Agreement."

    See Cmpl. Exhibit A (License Agreement) § 2.05.

  12. By its unambiguous terms, Section 2.05 does not require DaimlerChrysler to include the Linux Certifications in response to a request from the Licensor. See Cmpl. Exhibit A (License Agreement) § 2.05.

  13. By its terms, Section 2.05 does not require DaimlerChrysler to "provide evidence of compliance by producing copies" of its policies or manuals, which SCO demanded DaimlerChrysler provide in its second Linux Certification. See Cmpl. Exhibit B (SCO Letter) at 2.

  14. After receiving the SCO Letter, DaimlerChrysler did not furnish SCO with the Linux Certifications. See Eichbauer Aff. Exhibit 1.

  15. SCO did not contact DaimlerChrysler after sending the SCO Letter and prior to initiating this lawsuit.

  16. Instead, SCO filed its Complaint on March 3, 2004, claiming it had been "compelled" to do so by DaimlerChrysler's "refusal" to respond to the SCO Letter. See Cmpl. ¶¶ 4-5, 26-27.

  17. DaimlerChrysler responded to the SCO Letter on April 6, 2004. See Eichbauer Aff. Exhibit 1 (Letter from Susan J. Unger to Bill Broderick (the "DaimlerChrysler Letter")).

  18. The DaimlerChrysler Letter attached a letter from Norman A. Powell, Senior Manager of Tech Services for DaimlerChrysler, which provided SCO with the following certification: "No SOFTWARE PRODUCT licensed under the subject Agreement is being used or has been used in more than seven years, and as a result there is full compliance with the provisions of the subject Agreement." Id.

  19. Because the DaimlerChrysler Letter satisfies any certification obligation that DaimlerChrysler may have had to SCO under Section 2.05 of the License Agreement, 1 DaimlerChrysler requested in its letter that SCO withdraw its Complaint. Id.

  20. To date, SCO has neither withdrawn its Complaint nor otherwise responded to the DaimlerChrysler Letter.

ARGUMENT

SCO claims that DaimlerChrysler breached the License Agreement by failing to provide SCO with the Linux Certifications. Put simply, this claim fails because DaimlerChrysler has no obligation under the plain terms of the License Agreement to provide SCO with the Linux Certifications. SCO's inability to identify any express contractual provision that DaimlerChrysler breached requires dismissal of its claim. See, e.g., Hesse v. Chippewa Valley Schools, No. 209080, 2001 WL 789540, at *5 and n.6 (Mich App, Jan. 12, 2001)(per curiam) (attached hereto as Exhibit B)(reversing trial court's refusal to grant defendant summary disposition where plaintiff's breach claim was based on an argument that the agreement was "not controlled by its express terms," and finding that plaintiffs had submitted no evidence that defendants "failed to honor their obligations under the plan."); Pirrera v. Bath & Tennis Marina Corp, 2 AD3d 613; 769 NYS2d 565 (2003) (reversing denial of summary judgment where unambiguous terms of license agreement constrained plaintiff's use of a boat slip to a specific time period; absence of right of renewal in license defeated plaintiff's claim that failure to renew constituted a breach).

I. STANDARD OF REVIEW

MCR 2.116(C)(10) tests the factual sufficiency of the complaint. See Singerman v. Mun Serv Bureau, Inc, 455 Mich 135, 139; 565 NW2d 383 (1997); see also Spiek v. Mich Dep't of Trans, 456 Mich 331, 337;572 NW2d 201 (1998). "The purpose of summary disposition is to avoid extensive discovery and an evidentiary hearing when a case can be quickly resolved on an issue of law." Podorsek v. Lawyers Title Ins Co, No. 241450, 2003 WL 22928819, at *3 (Mich App, Dec. 11, 2003)(per curiam)(attached hereto as Exhibit C)(citing Amer Cmty Mut Ins Co v. Comm'r of Ins, 195 Mich App 351, 362; 491 NW2d 597 (1992)). A motion for summary disposition under MCR 2.116(C)(10) may be raised at any time. MCR 2.116(D)(3).

A motion seeking summary disposition pursuant to MCR 2.116(C)(10) must specifically identify the issues as to which the movant believes that there is no genuine issue of material fact. LoPiccolo Homes, Inc. v. Grand/Sakwa of Brooklane, No. 241386, 244800, 2003 WL 23018549, slip op. at *2 n.1 (Mich App, Dec 23, 2003)(per curiam)(attached hereto as Exhibit D)(citing MCR 2.116(G)(4)); MCR 2.116(G)(4)). The movant has the initial burden of supporting its position with affidavits, pleadings, admissions, and other documentary evidence. Id. (citing Quinto v. Cross & Peters Co, 451 Mich 358, 362; 547 NW2d 314 (1996)). The burden then shifts to the opposing party to set forth specific facts showing a genuine issue of material fact for trial. Id. (citations omitted). If there are no genuine issues of material fact, the moving party is entitled to judgment as a matter of law. See Maiden v. Roxwood, 461 Mich 109, 120; 597 NW2d 817 (1999). The test is whether the kind of record that might be developed will leave open an issue upon which reasonable minds might differ. Singerman, 455 Mich at 139.

This case presents no issue on which reasonable minds might differ. The unambiguous terms of Section 2.05 of the License Agreement are susceptible to only one reasonable interpretation, and bar SCO's claim for breach and declaratory judgment as a matter of law. Moreover, because the License Agreement's terms are unambiguous, no amount of discovery would enable SCO to develop a record that would leave open the issue of breach. Accordingly, this Court should grant summary disposition in favor of DaimlerChrysler on SCO's claims.

II. THERE IS NO GENUINE ISSUE OF FACT AS TO WHETHER DAIMLER
CHRYSLER BREACHED THE LICENSE AGREEMENT.

A. The Plain Terms of the License Agreement Do Not Require DaimlerChrysler to Provide the Linux Certifications.

A trial court "should grant summary disposition" on a breach of contract claim where the terms of the contract are plain and unambiguous, and subject to only one reasonable interpretation.2 See Henderson v. State Farm Fire and Cas Co, 460 Mich 348, 353; 596 NW2d 190 (1999); see also LoPiccolo, No. 241386, 244800, 2003 WL 32018549, at *2 (the meaning of unambiguous contract terms may be determined in a summary disposition proceeding); R/S Assocs v. NY Job Dev Auth, 98 NY2d 29, 32-33; 771 NE2d 240 (2002) (citations and internal quotations omitted) (affirming grant of summary judgment to defendant on ground that contract term was unambiguous, and rejecting plaintiff's interpretation as unreasonable); Sutton v. East River Sav Bank, 55 NY2d 550, 555; 435 N.E.2d 1075 (1982) (if a contract term is unambiguous on its face, its proper construction is a question of law). Cf. SSC Assoc Ltd P'ship v. Gen Ret Sys of the City of Detroit, 192 Mich App 360, 363; 480 NW2d 275 (1992) (a contract term is ambiguous, and summary judgment inappropriate, where its terms are subject to more than one reasonable interpretation); Leon v. Lukash, 121 A.D.2d 693, 694; 504 N.Y.S.2d 455 (1986) (when language of a contract is ambiguous, its construction presents a question of fact which may not be resolved by the court on a motion for summary judgment).

In both New York and Michigan, "[t]he fundamental, neutral precept of contract interpretation is that agreements are construed in accordance with the parties' intent." Greenfield v. Philles Records, Inc., 98 NY2d 562, 569; 780 NE2d 166 (2002); see also Klever v. Klever, 333 Mich 179, 186; 52 NW2d 653 (1952) ("The cardinal rule in the interpretation of contracts is to ascertain the intention of the parties."). "The best evidence of what the parties to a written agreement intended is what they say in their writing." Slamow v. Del Col, 79 NY2d 1016, 1018; 594 NE2d 918 (1992); see also Nichols v. Nichols, 306 NY 490, 496 119 NE2d 351 (1954) ("The first and best rule of construction of every contract, and the only rule we need here is that, when the terms of a written contract are clear and unambiguous, the intent of the parties must be found therein."); Qual Prods and Concepts Co v. Nagel Precision, Inc., 469 Mich 362, 375; 666 NW2d 251 (2003) (an unambiguous contractual provision is reflective of the parties' intent as a matter of law).

Thus, when the terms of an agreement are clear and unambiguous, the contract "is to be interpreted by its own language... [and the] writing should be enforced according to its terms." R/S Assocs, 98 NY2d at 32 (citations omitted); see also Teitelbaum Holdings Ltd v. Gold, 48 NY2d 51, 56; 396 NE2d 1029 (1979) (reinstating trial court's refusal to read settlement agreement as providing defendant a right of set-off where agreement expressly provided for set-off in only one circumstance, and noting, "matters extrinsic to the agreement may not be considered when the intent of the parties can be gleaned from the face of the instrument."); Mich Chandelier Co v. Morse, 297 Mich 41, 48; 297 NW 64 (1941) (where contract language is clear and unambiguous and has definite meaning, court must determine parties' intent from the words used in the contract); Zurich Ins Co v. CCR and Co, 226 Mich App 599, 603-604; 576 NW2d 392 (1998) (affirming summary disposition based on contract's clear and unambiguous language, and refusing to permit plain meaning of the words, and parties' intent, to be impeached by extrinsic evidence).

A contract is unambiguous if the language it uses has a "definite and precise meaning, unattended by danger of misconception in the purport of the agreement itself, and concerning which there is no reasonable basis for a difference of opinion." Greenfield, 98 NY2d at 569 (internal quotations and citations omitted); see also SSC Assocs Ltd, 192 Mich App at 363 (ambiguity exists if the terms of a contract are subject to two or more reasonable interpretations). "An ambiguity never arises out of what was not written at all but only out of what was written so blindly and imperfectly that its meaning is doubtful." Greenfield, 98 NY2d at 573 (quoting Trs of Freeholders & Commonality of Town of Southampton v. Jessup, 173 NY 84, 90; 65 NE 949 (1903)).

These fundamental principles of contract law dictate dismissal of SCO's action here. SCO bases its breach claim on Section 2.05 of the License Agreement, which provides:

On AT&T-IS's request, but no more frequently than annually, Licensee shall furnish to [AT&T-IS] a statement, certified by an authorized representative of Licensee, listing the location, type and serial number of all Designated CPUs hereunder and stating that the use by Licensee of Software Products subject to this Agreement has been reviewed and that each such Software Product is being used solely on such Designated CPUs (or temporarily on back-up CPS) for such Software Products in full compliance with the provisions of this Agreement.

Cmpl. Exhibit A (License Agreement) § 2.05. Thus, Section 2.05 expressly delineates the requirements for certification; (1) a statement, (2) certified by an authorized representative, (3) listing the location, type and serial number of all Designated CPUs and (4) stating (a) that the Licensee has "reviewed its use of the Software Products" and (b) "that each such Software Product is being used on such Designated CPU's for such Software Products in full compliance with the provisions of the Agreement." Id.

By these plain terms, DaimlerChrysler's certification obligations are limited to listing the required information about Designated CPUs and making the required statements (1) that DaimlerChrysler has reviewed its use and (2) that its use is in full compliance with the contract. Nothing in the language of Section 2.05 manifests the slightest intent by the parties to permit the Licensor to demand, or to require DaimlerChrysler to provide, additional statements, more detailed statements, or any further information, documentation or "evidence of compliance" such as that sought in the Linux Certifications.3 See Cmpl. Exhibit B (SCO Letter).

Indeed, Section 2.05's express recitation of the requirements for certification precludes reading that language to require DaimlerChrysler to provide the seven Linux Certifications. See, e.g. Teitelbaum, 48 NY2d at 56 (finding that contract provided right to set-off in only one instance and that there was "simply [...] no basis for viewing this language as ambiguous or covering situations not expressly mentioned"); Maysek v. Moran, Inc, 284 AD2d 203, 204; 726 NYS2d 546 (2001) (affirming summary judgment where agreement unequivocally stated that plaintiff was retained for a particular purpose, and refusing to read into contract broader purpose in the absence of language indicating broader purpose).

A finding to the contrary also would violate the time-honored canon of contract construction known as "expresso unius est exclusion alterius" (the express mention of one thing implies the exclusion of another). Under this interpretive principle, the specific description in Section 2.05 of the certification's contents — including the setting forth the language to be used in each of the two required statements — compels a finding that the omission of the Linux Certifications is intentional and unambiguous. See Uribe v. Merch Bank of NY, 91 NY2d 336, 340-341; 693 NE2d 740 (1998) (affirming rejection of plaintiff's argument that term "valuable papers" was ambiguous and could include cash, applying principle of "inclusion unius est exclusion alterius (the inclusion of one is the exclusion of another)" to conclude that the omission of "cash" was "intentional and unambiguous," and noting that plaintiff's proposed definition "rest[ed] on an impermissibly strained reading to find an ambiguity which otherwise might not be thought to exist.") (internal quotation and citation omitted); Two Guys From Harrison-NY, Inc v. S.F.R. Realty Assocs, 63 NY2d 396, 403-04; 472 NE2d 315 (1984) (invoking doctrine of inclusion unius est exclusion alterius to affirm conclusion that express specification of certain authorized alterations should be read as implicitly prohibiting other alterations); Payne v. Palisades Interstate Park Comm'n, 226 AD2d 902, 902; 640 NYS2d 683 (App Div 1996) (agreement's delineation of express rights to one party to construct dwellings on land compelled finding that contract implicitly prohibited other party from constructing dwellings on land). Moreover, if the parties to the License Agreement — two sophisticated business entities — had intended to require that Licensees provide the seven Linux Certifications, or anything like them, they would and could have included such language in Section 2.05. See Uribe, 91 NY2d at 340-341.

Nor is there any ambiguity in Section 2.05's terms that could justify expanding it into an obligation to make the seven additional affirmative representations, or to provide the additional internal documentation, described in the Linux Certifications. The phrase "stating that" is a restrictive clause with a clear and definite meaning, and is not susceptible to alternate reasonable interpretations. See, e.g., Webster's Modern Office Dictionary (Random House 1999) at 362-363 (defining "state" as "to express in speech or writing" and 385 (defining "that" as a conjunctive "(used to introduce a subordinate clause expressing cause, purpose, result, etc.): I'm sure that you'll like it" (emphasis in original)). As a result, Section 2.05's requirement that the certification "state[] that each such Software Product is being used on such Designated CPUs for such Software Products in full compliance with the provisions of the Agreement" can only be read as obligating the Licensee to provide the statement specified, i.e., "each such Software Product is being used...in full compliance with the provisions of the Agreement." There is nothing indefinite or ambiguous about what the certification must state, and no basis for enlarging the Licensor's rights beyond this specific and limited requirement.

DaimlerChrysler's certification obligation is limited to the unambiguous terms of Section 2.05, which cannot be read to include the Linux Certifications. As a result, DaimlerChrysler did not breach the License Agreement when it elected not to provide the Linux Certifications to SCO.4 SCO's effort to rewrite the License Agreement 16 years after it was written by other parties, and more than seven years after DaimlerChrysler stopped using the licensed software, fails as a matter of law.

B. SCO'S Failure to Identify a Contractual Breach is Fatal to its Claim.

SCO's failure to identify an express provision of the License Agreement that DaimlerChrysler allegedly breached entitles DaimlerChrysler to judgment as a matter of law. It is axiomatic that a requisite element for a breach of contract claim is an actual breach. See Uribe, 91 NY2d at 342 (affirming summary judgment dismissing claim for breach of contract where court found that plain language of agreement precluded plaintiff's claim for breach); Old Kent Bank v. Sobczak, 243 Mich App 57, 69-70; 620 NW2d 663 (2000) (reversing a denial of summary judgment to defendants where the court found that defendants were not in default of contract based on the contract's plain language). SCO cannot establish any genuine issue of material fact as to breach because the undisputed evidence demonstrates that DaimlerChrysler acted in accordance with its contractual obligations and that no breach occurred.

The SCO Letter provides the purported basis for SCO's contention that it requested certification pursuant to Section 2.05 and that DaimlerChrysler breached the License Agreement by failing to provide the "contractually required compliance certification." See Cmpl. ¶¶ 2, 26-27. However, the SCO Letter makes clear that SCO unilaterally purported to define DaimlerChrysler's alleged obligation under Section 2.05 as a duty to provide the Linux Certifications. See Cmpl. Exhibit B at 1. Because the License Agreement does not impose such an obligation on DaimlerChrysler, DaimlerChrysler was not required to respond to the SCO Letter.5 Further, DaimlerChrysler acted in accordance with the Agreement by not providing SCO with the Linux Certifications. Absent a contractual duty to provide that information, there was no breach. See, e.g., Pirrera, 769 NYS2d at 566 (reversing denial of summary judgment because defendant's failure to renew could not constitute breach where unambiguous terms of agreement did not provide plaintiff with right of renewal).

In any event, DaimlerChrysler has provided SCO with a certification that complies with the express requirements of Section 2.05. See Eichbauer Aff. Exhibit 1. Specifically, the DaimlerChrysler Letter provides SCO with the required information about Designated CPUs (explaining that none are in use); certifies that an authorized person reviewed DaimlerChrysler's use; and states that "no software product licensed under the subject Agreement is being used or has been used in more than seven years, and as a result there is full compliance with the provisions of the subject Agreement." Id. In so doing, DaimlerChrysler has discharged any conceivable certification obligation it may have under Section 2.05. DaimlerChrysler has not breached the License Agreement, and SCO's claim fails as a matter of law.

C. There is No Reasonable Chance That Discovery Will Result in Factual
Support For SCO's Claim of Breach.

Summary disposition before the completion of discovery is proper "where further discovery does not stand a fair chance of uncovering factual support for the position of the party opposing the motion." Prysak v. R.L. Polk Co, 193 Mich App 1, 11; 483 NW2d 629 (1992) (affirming grant of summary disposition in defendant's favor); see also Greenbaum v. Barthman, 210 AD2d 160, 160-161; 620 NYS2d 954 (App Div 1994) (affirming summary judgment and denial of plaintiff's requests for additional discovery where contract was unambiguous and plaintiff failed to establish that facts essential to justify opposition to summary judgment existed). For a court to rule against summary disposition and allow discovery to continue, the party opposing the motion must identify the disputed issue and support that issue with independent evidence. See Hyde v. Univ of Mich Bd Of Regents, 226 Mich App 511, 519; 575 NW2d 36 (1997) (affirming grant of summary disposition where "plaintiff failed to show by affidavit that further development would support his claims").

Summary disposition should be granted here because SCO cannot support its breach claim with independent evidence. The sole basis for SCO's claim is its contention in the SCO Letter that a certification pursuant to Section 2.05 of the License Agreement must include the Linux Certifications. Because the plain terms of the License Agreement itself contradict that contention, extrinsic evidence may not be introduced to rewrite the License Agreement's plain terms, and no amount of factual discovery would enable SCO to uncover factual support for its position.6 See, e.g., Prysak, 193 Mich App at 11 (concluding that summary disposition was not granted prematurely because discovery would not have uncovered factual support for plaintiff's claim); Wright v. DaimlerChrysler Corp, 220 F Supp 2d 832, 844 (ED Mich, 2002) (granting defendant's motion for summary judgment where plaintiff did not show that additional discovery was necessary). Therefore, this Court should grant summary disposition in DaimlerChrysler's favor on SCO's claims for breach of contract.

III. SCO'S CLAIM FOR DECLARATORY JUDGMENT FAILS FOR LACK OF AN
ACTUAL CONTROVERSY.

SCO's failure to identify an actual breach by DaimlerChrysler requires dismissal of its claim for declaratory judgment as well. Under the Michigan Court Rules, a party may only obtain a declaratory judgment "[i]n a case or actual controversy..." See MCR 2.605(A); McGill v. Auto Ass'n of Mich, 207 Mich App 402, 407; 526 NW2d 12 (1994). An "actual controversy" exists when the judgment is "necessary to guide a plaintiff's future conduct in order to preserve his legal rights." Shavers v. Kelley, 402 Mich 554, 589; 267 NW2d 72 (1978). If what a party seeks to protect is merely hypothetical, there is no "actual controversy," and no basis for a declaratory judgment. Id.

Because the undisputed facts here demonstrate that DaimlerChrysler has not breached the License Agreement, there is no "actual controversy" on which SCO can base a claim for declaratory judgment.7 See id. at 589 (["B]efore affirmative declaratory relief can be granted, it is essential that a plaintiff, at a minimum, plead facts entitling him to the judgment he seeks and proves each fact alleged, i.e., a plaintiff must allege and prove an actual justiciable controversy."); McGill, 207 Mich App at 407 (affirming trial court's denial of declaratory judgment where the "review of the record reveals no evidence that plaintiffs have suffered injury as a result of defendants' partial payment of their medical bills; nor is any injury threatened"). The Court should therefore also grant summary disposition to DaimlerChrysler on SCO's cause of action for "Declaratory Judgment," to the extent that it deems that cause to be distinct from SCO's breach of contract claim.

CONCLUSION

For the foregoing reasons, DaimlerChrysler respectfully requests that the Court grant summary disposition in its favor and against SCO, and deny SCO its requested relief in its entirety.

Dated: April 15, 2004

  Respectfully Submitted,
(signature)    
James Feeney, Esq.
Dykema Gossett PLLC
[address]
[phone]
Attorneys for Defendant
DaimlerChrysler Corporation

Of Counsel:

HALE AND DORR LLP

Mark G. Matuschak
Michelle D. Miller
[address]
[phone]

Robin L. Alperstein
[address]
[phone]






1 DaimlerChrysler contests that it owes SCO any obligation under the License Agreement. See, e.g., Answer and Affirmative Defenses of Defendant DaimlerChrysler Corporation ¶¶ 2, 4-5, 27-29.

2 Though Michigan procedural law applies, New York law applies to the construction and performance of the License Agreement. See Cmpl. Exhibit A (License Agreement) § 7.12. DaimlerChrysler therefore cites the law of both jurisdictions in support of its motion.

3 SCO contends that it is entitled to the Linux Certifications because Section 2.05 constitutes "a monitoring and reporting mechanism designed to detect (and thus deter) violations of [the License Agreement]." See Cmpl. ¶ 1. Even if that characterization were accurate, which it is not, the sole "reporting" obligation defined in Section 2.05 is the obligation to provide the specified information about Designated CPUs and the specified statement of compliance, and the sole "monitoring" right is the right to receive that specified information. No language in Section 2.05 gives the Licensor the right to demand anything further.

4 To the extent that SCO claims that DaimlerChrysler breached the License Agreement's confidentiality provisions, see Cmpl. ¶ 28, that claim fails based on the absence of breach under Section 2.05. SCO expressly predicates its allegation on the assumptions: (1) that failure to make the Linux Certifications constitutes a breach; and (2) that the only basis for not making the Linux Certifications is an underlying breach of the confidentiality provisions. See id. Thus, SCO's inability to establish a breach based on the Linux Certifications negates the assumptions on which SCO bases its claim that DaimlerChrysler somehow violated the confidentiality provisions of the License Agreement, and that claim also fails as a matter of law since it is entirely predicated on SCO's faulty argument about Section 2.05.

5 Even if DaimlerChrysler had been required to respond to SCO's letter, the License Agreement contains no provision requiring DaimlerChrysler to respond within a particular time frame, much less within 30 days. See Cmpl. Exhibit A (License Agreement) § 2.05 and generally. Accordingly, DaimlerChrysler did not breach the License Agreement by responding on April 6, 2004 rather than within 30 days.

6 Likewise, no amount of discovery could support SCO's allegation. See Compl. ¶ 28, that "refusal" to provide the Linux Certifications is evidence of a breach of the License Agreement's confidentiality provisions. See discussion n. 4, supra.

7 SCO drafted the single cause of action in its Complaint as "Breach of Contract/Declaratory Judgment." See Cmpl. p. 4. Because SCO identifies no basis for a declaratory judgment other than the faulty basis alleged for breach of contract, SCO has no visible claim for declaratory judgment either.


STATE OF MICHIGAN
IN THE CIRCUIT COURT FOR THE COUNTY OF OAKLAND

THE SCO GROUP, INC.,

Plaintiff,

vs.

DAIMLERCHRYSLER CORPORATION,

Defendant.
Civil Action No. 04-056587-CKB

Honorable Rae Lee Chabot

Joel H. Serlin (P20224)
Barry M. Rosenbaum (P26487)
SEYBURN, KAHN, GINN, BESS AND
SERLIN, P.C.
Attorneys for Plaintiff
[address]
[phone]
James P. Feeney (P13335)
Thomas S. Bishoff (P53753)
Stephen L. Tupper (P53918)
DYKEMA GOSSETT PLLC
Attorneys for DaimlerChrysler Corporation
[address]
[phone]

_____________________________

AFFIDAVIT OF PAUL R. EICHBAUER

PAUL R. EICHBAUER, being duly sworn, deposes and says:

  1. I am Assistant General Counsel -- Commercial Affairs for DaimlerChrysler Corporation ("DaimlerChrysler"). I have personal knowledge of the matters set forth herein and submit this affidavit in support of DaimlerChrysler's Motion for Summary Disposition.

  2. Attached hereto as Exhibit 1 is a true and correct copy of a letter dated April 6, 2004 from Susan J. Unger to Bill Broderick, attaching a certification letter dated April 6, 2004 from Norman A. Powell to Unix System Laboratories, Inc.

  (signature)    
Paul R. Eichbauer

Sworn to before me this
 15  day of April 2004

  (signature)    
Notary Public

Of Counsel:

HALE AND DORR LLP

Mark G. Matuschak
Michelle D. Miller
[address]
[phone]

Robin L. Alperstein
[address]
[phone]


(DaimlerChrysler letterhead)

DaimlerChrysler Corporation
Susan J. Unger
Sr. Vice President & CIO
Information Technology Management

April 6, 2004

Bill Broderick
Director, Software Licensing
The SCO Group, Inc.
[address]

RE: Your letter to "Chrysler Motors Corporation" dated December 18, 2003
regarding "AT&T/SCO License No. SOFT-01341"

Dear Mr. Broderick:

DaimlerChrysler Corporation ("DaimlerChrysler"), successor in interest to Chrysler Motors Corporation, understands from the lawsuit filed against DaimlerChrysler in the Oakland County Circuit Court (Case No. 04-056587-ck) that The SCO Group, Inc. ("SCO") believes that:

  1. SCO "owns" certain rights under the Software Agreement referenced above ("SA"), and,
  2. SCO's referenced letter was a proper request for a certified statement under Section 2.05 of the SA.

SCO is not a party to the SA, and DaimlerChrysler has no knowledge of any assignment of the rights of the Licensor under the SA to SCO. According to our records, the SA was assigned from AT&T Information Systems Inc. to UNIX System Laboratories, Inc. on or about November 1, 1990. Notwithstanding these facts, SCO has filed its suit against DaimlerChrysler. SCO's suit appears to be based on an uninformed and inaccurate assessment of DaimlerChrysler's conduct. As a result, and without waiving any of its rights under the SA or under applicable law, including without limitation its right to assert that SCO has no rights under the SA, that SCO has no right to seek the certified statement that its letter requests, that Licensor has waived any right to seek a certified statement under the SA, and that SCO has intentionally filed a meritless lawsuit for purposes of restraining competition, DaimlerChrysler provides the attached information to SCO.

To the extent that SCO's suit is intended merely to obtain the information called for by Section 2.05 of the SA, all such information is contained on the attachment to this letter. Accordingly, DaimlerChrysler believes that this letter should cause SCO to dismiss its suit. Please contact DaimlerChrysler's counsel to discuss and arrange for this dismissal.

Very truly yours,

Susan J. Unger

(signature)

Attachment


(DaimlerChrysler letterhead)

DaimlerChrysler Corporation

April 6, 2004

Unix System Laboratories, Inc.
[address]

Re: Software Agreement SOFT-01341 between DaimlerChrysler Corporation, formerly known as "Chrysler Motors Corporation", and UNIX System Laboratories, Inc. ("USL"), successor to AT&T Information Systems Inc. ("AT&T- IS")

On behalf of DaimlerChrysler Corporation, I hereby certify that, as of the date indicated above, there is no DESIGNATED CPU, or any CPU, on which the SOFTWARE PRODUCT licensed under the subject Agreement is being used. This has been the case for more than seven years. As a result, no list of the location, type and serial number of any DESIGNATED CPU is relevant or possible.

I further certify that DaimlerChrysler Corporation's use of the SOFTWARE PRODUCT licensed under the subject Agreement has been reviewed. NO SOFTWARE PRODUCT licensed under the subject Agreement is being used or has been used for more than seven years, and as a result DaimlerChrysler Corporation is in full compliance with the provisions of the subject Agreement.

The terms DESIGNATED CPU, CPU, and SOFTWARE PRODUCT are used in this letter with the meanings defined in the subject Agreement. I represent that I am authorized by DaimlerChrysler Corporation to make this certification.

Sincerely,

(signature)

Norman A. Powell
Senior Manager, Tech Services
DaimlerChrysler Corporation


  


DaimlerChrysler's Motion, Memorandum, and Exhibits - as text | 133 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Mistakes and typos here pls.
Authored by: PJ on Saturday, May 01 2004 @ 06:09 AM EDT
Please put all corrections here, so I can find them easily. Thank you.

[ Reply to This | # ]

URLs here please
Authored by: Anonymous on Saturday, May 01 2004 @ 06:23 AM EDT

[ Reply to This | # ]

Change of Song
Authored by: Anonymous on Saturday, May 01 2004 @ 06:57 AM EDT
> Besides, the license says if there is a transfer, they
> were to be notified, and they never got any notice of
> any transfer to SCO.

Does this mean SCOs song will change from "All your code is ours" to
"All Our Licenses Are Invalid"

Gotta think DCC isn't the only one who wasn't notified ;-)

[ Reply to This | # ]

Where's the Beef?
Authored by: Anonymous on Saturday, May 01 2004 @ 07:02 AM EDT
Once the beef has been through the coarse grinder a couple of times, replace the
coarse grinding plate with the fine grinding plate and run the beef through,
once more.

At this point, the beef will be very lacking in substance and will probably be
very bland and unsatisfying. I recommend spicing it up with something really
eyewatering.

You don't want the party animals to forget in a hurry, do you?

Regards
Ian Al

[ Reply to This | # ]

DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: blacklight on Saturday, May 01 2004 @ 07:12 AM EDT
SCOG is probably too radioactive for any buyout:

(1) SCOG's lawsuit against DC can be used as a piece of evidence, independeet of
its conduct in the IBM lawsuit, that SCOG is engaging in abuse of process.

(2) SCOG's behavior to DC as a UNIX licensee (or former UNIX licensee) would be
the third element in any future breach-of-contract suit by Novell against SCOG -
the other two being SCOG's two series of letters to corporate end users.

(3) SCOG has been engaging at least in restraint of trade when it alleged that
its contract with Novell forbids Novell from competing with SCOG.

(4) Enough indications have accumulated that SCOG has been manipulating its
stock price and thus, SCOG is vulnerable to an SEC investigation at any time.

(5) SCOG's behavior as exemplified by its actions and its public statements have
been aimed at discouraging the adoption of Linux by corporate end users, and
damaging IBM's and RH's business models. SCOG has clearly been engaging in
restraint of trade based on little to nothing more than its allegations: the
only question is, has enough evidence accumulated to make SCOG vulnerable to a
finding that SCOG has been engaging in restraint of trade? And if not, what
other evidence needs to be found? Time is actually works for us in producing
additional evidence: SCOG is likely to be found to have violated the Lantham Act
in the IBM trial, and its lawsuit against DC is likely to be dismissed with
prejudice.

Enough time and enough indicators have accumulated that is proper to call SCOG a
rogue corporation, whose top management have made public pronouncements with
reckless disregard for the truth - the trade secret violation allegations, the
constitutionality of the GPL being just two examples.

AS a footnote, VCs (venture capitalists) love to plan for exit strategies,
especially if one of those is a buyout. Well, Baystar's exit strategy in this
case is the loss of its entire investment in SCOG: dumb coprporation did attract
dumber backers.

[ Reply to This | # ]

DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Hygrocybe on Saturday, May 01 2004 @ 07:34 AM EDT
It is not often you that you can point at a commercial entity and say (without
ANY possibility of contradiction) that they have made an utter fool of
themselves..and better yet, have done it in such a way that everybody can see
it...but in this case, there is absolutely no doubt that SCO has done just that.
I hope Baystar and the Bank of Canada are taking notes.

---
Blackbutt, Australia

[ Reply to This | # ]

DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Glenn on Saturday, May 01 2004 @ 07:48 AM EDT
This latest also proves that PJ is Super Woman and/or Wonder Woman. She must
never sleep. Of course I have been known to get up at three o'clock in the
morning to click on the Groklaw bookmark on my personal bookmark toolbar to see
ifn she has put up anything new. But that is her fault. She has conditioned me
to expect new articles every ten minutes or so.
And as to the subject matter at hand, does anyone think that DCC will deem
the SCOG as being even worth filing against for its meritless frivilous suit?

Glenn

[ Reply to This | # ]

Attn: SCO are the Dogs that Microsoft has sent to attack your business! It's Microsoft!
Authored by: Anonymous on Saturday, May 01 2004 @ 07:52 AM EDT
The forest thru the trees is this.

Microsoft, via Baystar and directly, by investing in SCO as SCO positioned it's
fangs to SUE you, is behind all the attacks on you.

When Microsoft is looking to sell you something AND they are saying you can't
trust LINUX... Remember that it is Microsoft that is the one that funded and
supported the party that holds the handle of the bloody sword in your side! AND
now they want to help you and all you have to do is to pay them money.

The attack dog that is going for your throat... exists because of Microsoft, and
they are doing Microsoft's bidding. SCO is doing just what Microsoft wants them
to do... and according to Baystar (Microsoft) SCO is not doing enough! Baystar
aka Microsoft wants SCO to attack more of the corporate world, the sooner the
better (or else they want their money back).

When you think of SCO... THINK of Microsoft instead because it is your blood
that is on Microsoft's hands. Microsoft calls everyone, including customers a
partner, well, they are not very friendly to either their partners or their
customers. What do you do when you are threated such as Microsoft is treating
you... Do you buy more stuff from them?




[ Reply to This | # ]

DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Greebo on Saturday, May 01 2004 @ 07:54 AM EDT
Wow. This is good stuff.

It seems that i can't turn away from Groklaw for 5 minutes before SCO do something else stupendously stupid. DC have shot them down in flames.

Game over for SCO here i think.

Last one out turn off the light please.

Bye, bye. Nice to know you. So sad. hahahahahahaa!

Greebo

---
-----------------------------------------
Recent Linux Convert and Scared Cat Owner

[ Reply to This | # ]

Baystar involved?
Authored by: Anonymous on Saturday, May 01 2004 @ 08:04 AM EDT
Is it possible that this is the reason Baystar is unhappy? They wanted to use
SCO against a bank for some reason... in the initial lawsuit, but then something
prompted SCO to change their minds last minute and sue DC instead? I know
Baystar is unhappy with SCO's choice of companies to sue...

[ Reply to This | # ]

the why of Chrysler
Authored by: SpinyNorman on Saturday, May 01 2004 @ 08:36 AM EDT
I was pondering this during rush hour commute yesterday and I think I understand
why SCOG chose DaimlerChrysler. To be more precise, they chose Chrylser. Since
Daimler acquired Chrysler there has been siginificant tension between the German
management and the American division. The Chrysler division's financial
performance has been poor since the acquisition. And then there is Mr. Blepp in
Germany discussing has case full of "evidence". I believe that SCOG
was betting that the German management would prefer the cost of settlement to
the cost of litigation.

SCOG only needs one major corporation to roll over and take an "IP"
license. That precedent would cause smaller businesses to purchase licenses
ratheer than risk litigation. It is a shake-down technique similar to that of
the RIAA. For this reason I also don't believe that it was an accident that SCOG
sent out a document that would show through version history that Bank of America
had been a target. They are attempting to use fear and intimidation to get that
first (I discount EV1 as being too small and a M$ stooge) major licensee that is
the bottleneck to achieving extorted wealth.

[ Reply to This | # ]

A shot across the judge's bow?
Authored by: rsteinmetz70112 on Saturday, May 01 2004 @ 09:20 AM EDT
The first two cases cited in the ARGUMENT section are reversals of trial court
judges failure to grant summary judgment.

Do you think they were trying to tell the judge that if you don't grant us our
motion we're going to appeal and we have the case law to win?

Judges hate getting reversed more than being wrong.

The only thing worse for SCOG than getting thrown out of court by a summary
judgment would be getting it thrown out of court by summary, judgment on appeal.
Third would be losing an appeal of the summary judgment.

[ Reply to This | # ]

OT - GPL Constitutional
Authored by: Dave23 on Saturday, May 01 2004 @ 09:33 AM EDT
By the way, the wording 9th Amendment to the U. S. Constitution is necessary to keep the legal principle of expresso unius est exclusio alterius from being used in interpreting the Bill of Rights. Seems to me that one of those rights (in the U. S.) is to write a valid copyright license that does not contravene the laws of the U. S.

"The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people."

---
Gawker

[ Reply to This | # ]

Maybe SCO will try...
Authored by: Jude on Saturday, May 01 2004 @ 09:43 AM EDT
...non-literal contract interpretation.

What the hell, it's got as much support in law as the "non-literal
copying" swill they're trying to feed to Judge Kimball.

[ Reply to This | # ]

  • Of course - Authored by: PeteS on Saturday, May 01 2004 @ 11:48 AM EDT
    • Jazz Law - Authored by: Anonymous on Sunday, May 02 2004 @ 03:57 PM EDT
DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Anonymous on Saturday, May 01 2004 @ 10:09 AM EDT
Thank you, PJ and PDF-to-Text convertors. Groklaw is an amazing community. And
thank you, DC, for your clear and forthright response to SCO's extortion
attempt.

I can't help but notice that Blake Stowell has been quoted in the press by
Steven J. Vaughan-Nichols recently -- about whether SCO still considers the GPL
to be unconstitutional. I can't understand, though, how Mr Vaughan-Nichols let
him go without asking him about the DC response. There are so many incredibly
juicy questions waiting to be asked, and almost no possible responses from SCO
that don't channel the Iraqi Information Minister.

I'm guessing that Blake Stowell will hide out until something more incendiary
happens, like Darl getting fired, or something like that. Any reporter worth
his salt has to be salivating to ask SCO questions about the response from
DaimlerChrysler.

Thad Beier

[ Reply to This | # ]

Why SCOX didn't file in California
Authored by: Anonymous on Saturday, May 01 2004 @ 10:17 AM EDT
Could it be that SCOX is afraid of a SLAPP suit? I know California has a SLAPP
statute, but I don't think any of the other veniues do. Can a SLAPP action be
brought even if the case is in Federal Court?

FOSS is very much a public project. Shutting it down might be shown as
preventing public participation.

[ Reply to This | # ]

DC VP elegant understatement
Authored by: lightsail on Saturday, May 01 2004 @ 10:25 AM EDT
Senior YP Susan j. Unger’s letter has a beautiful closing line, "Please
contact DaimlerChrysler's counsel to discuss and arrange for this
dismissal."

My read of it is: TSG, we expect cash payment for this rude inconvenience and a
formal grovel-apology.

[ Reply to This | # ]

DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Anonymous on Saturday, May 01 2004 @ 10:48 AM EDT
i love that, amidst all the deny everthings, dc admits to being a corporation at
the address they said they were at according to the license. seems to me they
are setting up their defense well. in accordance with the license, they have
kept the other known party informmed as to their whereabouts. sco, on the other
hand, is in violation of the terms of the license it wants to enforce on those
very same grounds.

sco: we demand compliance beyond what is actually stipulated and, oh yeah, do
not expect us to be bound by the terms ourselves.

makes me smile a little.

sum.zero

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7 years with no SysV
Authored by: EdisonRex on Saturday, May 01 2004 @ 12:19 PM EDT
I think this says a lot for SysV's "IP value" in the first place,
regardless of who is claiming to "own" it. I've heard it said so many
places that SysV is ancient. I don't know
anybody running SysV anymore myself, not that I ever knew anyone running it in
the first place. We didn't even run that in college in the 80s.

Other than the "linux is SysV by reason of similarity in purpose",
what else could SCOG try to claim? Was DC an AIX customer?

---
The chief cause of problems is solutions - Eric Sevareid

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Reasonable?
Authored by: lanthus on Saturday, May 01 2004 @ 12:26 PM EDT
DC asserts that this is one of those rare cases that can be dismissed as a matter of law. "This case presents no issue on which reasonable minds might differ." I discern they don't know SCOfolk as well as we do.
I don't think it's as much that they don't know SCOfolk as much as it is the fact the SCOfolk have never been reasonable. Even if SCO's opinion differs the statement remains true.

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Why DCC? Why not BofA? Discussion
Authored by: DaveAtFraud on Saturday, May 01 2004 @ 02:20 PM EDT
OK everybody, dig out your tin-foil hats. PJ raises an interesting point as to
the SCOGgy's sudden shift from suing BofA to DCC. If you believe Darl (scary
thought), they were researching (pulling names out of hat?) several potential
candidates to file against. It looks like they setlled on BofA, actually did
some research and then suddenly went after Chrysler with almost no research.

What got the SCOflaws so scared of BofA? This could be as mundane as they
realized that RBC wouldn't like the precedent of suing a bank or BofA holds one
of their loans (Darl's mortgage?) to there being a key flaw in SCOG's game plan
that would likely come out if they sued BofA.

---
Quietly implementing RFC 1925 wherever I go.

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DCC: 1984 has come and gone, SCOG
Authored by: Stoneshop on Saturday, May 01 2004 @ 05:11 PM EDT
Favourite bit:

SCO's effort to rewrite the License Agreement 16 years after it was written by other parties,

Oh, and is there a translation table to convert lawyerese signoff lines such as "very truly yours" and "sincerely" into mortalspeak? From the tone of the above letters I take it that "sincerely" would offer good ice skating conditions, and "very truly yours" is around the temperature where oxygen liquifies.

---
Rik
IANALJLMOY


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DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Superbiskit on Saturday, May 01 2004 @ 10:26 PM EDT
We know from the metadata in the complaint, written in Microsoft Word, that SCO apparently intended to sue a bank, the Bank of America,
These guys must have a death wish!

And that may be the reason for changing to AutoZone. BoA certainly would have no problem hiring very competent council. Before the case was finished, I suspect BoA would wind up owning SCOX.

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Why DaimlerChrysler was dropped
Authored by: Slimbo on Saturday, May 01 2004 @ 11:43 PM EDT
I belive DC was dropped because of the anticipate request to shut down the
systems running Linux. This would effectively shut down BoA. Since BoA is a
major mover of money in the US (and the rest of the wolrd) it would create great
turmol for the economy.

This would have put a very bright spot light on SCO and associated parties from
the SEC. Everyone in our legislative braches would be salivating at a chance
for some press time claiming how they would be holding hearings and
congressional invetigations into the situation.

SCO is nowhere near big enough to fund that many re-election campaigns. Even
Microsquish couldn't do it without attracting more spotlights than the academy
awards.

So when Baystar or the "invisible" investors got wind of it at the
11th hour they pulled the plug on BoA. This left SCO scrambling for new target.
They created a self-imposed dead line that didn't allow them time to properly
investigate other candidates. They simple chose the biggest company on their
list that would not draw governmental attention. I do believe they looked at
the Germany connection also to put a little heat on the Germany situation after
being told to more-or-less "Put up or shut up!"

Just my thoughts on the subject,
Randy

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VEXATIOUS LITIGANT
Authored by: Anonymous on Sunday, May 02 2004 @ 05:58 AM EDT
any chance this could be applied to SCO?

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Novell Told TSG To Stop, Why Didn't DC Include This?
Authored by: Steve Martin on Sunday, May 02 2004 @ 11:18 AM EDT

I just went back and took a look at some stuff in recent history, and noticed that DaimlerChrysler made a reference in their Fourth Affirmative Defense to Novell:

Lack of Standing. Plaintiff is not a party to the License Agreement attached to the Complaint, and therefore Plaintiff may lack standing to sue. Plaintiff also lacks standing to sue because the terms of Plaintiff's contract with Novell, Inc. ("Novell") require Plaintiff to waive its right to enforce the License Agreement upon Novell's request, which, upon information and belief, Novell has expressly requested Plaintiff to do.
Of course, DC is right; Novell did expressly order TSG to stop harassing SysV customers with their certification demands:
We learned yesterday that SCO is demanding that UNIX SVRX licensees issue a certification meeting SCO specifications.

To the extent that this communication is directed to licensees under SVRX Licenses (as defined in the Asset Purchase Agreement), SCO is once again purporting to take action that Novell believes is unwarranted, and that is designed less to protect legitimate intellectual property or contractual rights and more to harass customers. At no time did SCO consult with Novell on this issue -- notwithstanding Novell's 95% interest in revenues from these SVRX licenses.

Accordingly, pursuant to Section 4.16(b) of the Asset Purchase Agreement, Novell hereby directs SCO immediately to withdraw its demands for certification from licensees under SVRX Licenses, and to communicate SCO's compliance with this demand to Novell by no later than December 30, 2003. Should SCO fail to do so, Novell will take further action consistent with Section 4.16(b)
This certainly seems to indicate that TSG has no authority to initiate their certification demands. Since DC refers to Novell's authority in the Affirmative Defense, they obviously are aware of it, so I wonder why they didn't include this little tidbit in their Motion to Dismiss?

---
"When I say something, I put my name next to it." -- Isaac Jaffee, "Sports Night"

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Is there a hearing scheduled for DC case?
Authored by: OldPro on Sunday, May 02 2004 @ 07:15 PM EDT
According to TuxRocks, there is one more document in this case: 2004-04-15-B -
Notice of Hearing filed.

Is there a court date scheduled to hear these motions? Does anyone know when it
is?

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SCO DID know that DC wasn't a customer
Authored by: ChrisP on Sunday, May 02 2004 @ 09:17 PM EDT
Sorry PJ, I disagree with you here:

"The most extraordinary sentence is this one: "SCO did not contact
DaimlerChrysler after sending the SCO Letter and prior to initiating this
lawsuit." That explains why SCO didn't know that DC no longer uses the
licensed software and hasn't for 7 years now, which makes it pointless for SCO
to sue them for breach of the license agreement."

See for instance:

http://www.integratedmar.com/ecl.cfm?item=DLY030304-05

and

http://www.groklaw.net/article.php?story=2004031003470588

both reporting on the March 3rd. earnings teleconference.

"Operator: Ken Brown, Investors Business Daily.

Brown: In the customers that are the subjects you chose to file the first
lawsuits against, are you afraid of sending the message that you're going to go
after your own customers, your own licensees first? And when do you expect to
file some against Linux users who are not UNIX licensees?

McBride: I think if you look at the people we have filed suit against today,
they're not currently customers of SCO. We sat down with 25 of our largest
customers here several months ago at our national advisory board meeting, and we
have very good relationships with our current customer set. The current
customers we have are paying us licensing fees, and that is not where we have
the problem. It's been years since we have had a relationship with AutoZone and
a similar situation with Daimler. What we're looking at that with these UNIX
license contracts, basically even though we don't have revenue coming in from
those right now, what we do have, like in the case of Daimler, is a requirement
that they keep those source code licenses upheld in terms of the restrictions on
confidentiality. And so that's what we're doing in that case."

The whole Q&A section is worth reading again. SCO knew full well before
bringing the law suits that Autozone and Daimler-Chrysler were former customers.
Although both cases seem to be heading down the pan rapidly for SCO, they were
picked to make a point.

---
SCO^WM$^WIBM^W dammit, no-one paid me to say this.

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Dodgy?
Authored by: Anonymous on Monday, May 03 2004 @ 01:21 AM EDT
Hindsight is easy, nevertheless... Doesn't it seem like SCO is plagued with
unprofessionalism, hastiness and your garden variety speak-before-you-think
syndrome? I mean, how many stuff-ups are one too many?

Just think: "millions of lines of code", "MIT
mathematicians", "trade secrets" and all other pearls of wisdom.
Isn't there a shred of common sense at SCO?

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DaimlerChrysler's Motion, Memorandum, and Exhibits - as text
Authored by: Anonymous on Monday, May 03 2004 @ 10:37 AM EDT
Silly Silly Silly:

The SCO Group really isn't looking to sue based on this 2.05 hooey. Their case
really is about the fact that they think Daimler (& subsequently Chrysler)
contributed code to Linux. They filed on the 2.05 clause just to get their foot
in the door. They are still working out the details of how to prove that code
was dumped into Linux. They will more than likely try to put this case into a
holding pattern, just like the others.
The Germany connection is a real bonus for them, cause then they can allude to
the breif case of supporting documents, but never produce. Daimler would be
doing everyone a huge favor if they called for that breif case to be presented
as evidence immediately upon the redifining of the lawsuit.

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