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Novell Files Motion to Stay, Answer with Counterclaims etc.
Tuesday, April 11 2006 @ 03:14 PM EDT

Novell has filed a Motion to Stay Claims Raising Issues Subject to Arbitration (here's the Redacted Memorandum in Support [PDF]), telling the court that SCO's copyright infringement claims and in fact four of its five claims have to be brought to arbitration, as per the UnitedLinux agreement, under the Federal Arbitration Act, which requires a stay of any claim raising issues subject to arbitration. Therefore, it asks the court to stay all proceedings on SCO's claims until that matter can be cared for. Novell has already filed a request for arbitration.

You see, under the UL agreement, the parties agreed, Novell explains, that they could all use each other's intellectual property under broad license, including the right to sublicense, and some more things that are redacted because the UL agreement requires confidentiality. What we can read is that Novell asserts that any SCO IP put into UL divested SCO of ownership as per the UL contract. Further the agreement stipulated that any Open Source code contributed to UL would remain under its Open Source license, and so I gather Novell is saying the GPL stands in SCO's way blocking it from being able to assert proprietary rights to modified versions of the Linux kernel.

SCO could have saved us all a lot of trouble, don't you think, if it had read and understood the GPL before it started all this?

It has also filed a motion asking for a more definite statement [PDF] from SCO regarding what law SCO thinks is applicable to the unfair competition claims they have lodged.

Novell has also filed a killer Answer to SCO's 2d Amended Complaint and Counterclaims [PDF], with the following affirmative defenses:

  • Privilege
  • Estoppel
  • Unclean hands
  • Laches
  • Comparative fault
  • Failure to mitigate
  • No causation
  • U.S. Const. Amend. I
  • Misuse of copyright
  • Fraud on the Copyright Office
  • Independent creation
  • Fair use
  • License (the UnitedLinux agreements, the TLA, and ye olde GPL)
  • Implied License
  • Waiver
  • Abandonment and forfeiture
  • Obligation to Arbitrate
  • I haven't read it all myself yet, so we'll do it together and I'll write more after I have a chance to read it carefully, but my initial reaction on a quick read-through is that SCO is probably wishing it never added some of the claims it did to their 2d Amended Complaint, because now they are faced with a number of issues that they didn't face before, like being accused of fraud on the Copyright Office and copyright misuse. If SCO had not added the copyright infringement claim to their original slander of title action, none of that would be on the table. Well, they're in hot soup now.

    Man, do not mess with Novell. I never worked for lawyers as good as these guys, and it's a plumb pleasin' pleasure to watch them work.


      


    Novell Files Motion to Stay, Answer with Counterclaims etc. | 312 comments | Create New Account
    Comments belong to whoever posts them. Please notify us of inappropriate comments.
    re: answer to 2nd amended claims
    Authored by: Anonymous on Tuesday, April 11 2006 @ 03:19 PM EDT
    Wow - do I detect throwing the proverbial book ?

    [ Reply to This | # ]

    Corrections here, please
    Authored by: GuyllFyre on Tuesday, April 11 2006 @ 03:22 PM EDT
    Corrections, if required.

    [ Reply to This | # ]

    Off-Topic here, please
    Authored by: GuyllFyre on Tuesday, April 11 2006 @ 03:23 PM EDT
    Our always fun off-topic here.

    [ Reply to This | # ]

    Hot soup?
    Authored by: Anonymous on Tuesday, April 11 2006 @ 03:34 PM EDT
    Ha! SCO was in hot soup the moment IBM decided not to buy them out.
    Nevertheless, the suit dragged on for 3 years after that. And it will continue
    for another year, if the shcedule doesn't slip again.

    If you want to see some good lawyering, look at SCO lawyers. Their claims
    borderline on ludicrous, and yet they consistenly manage to dodge bullets. 3
    years and counting...

    [ Reply to This | # ]

    Novell Files Arbitration
    Authored by: rsteinmetz70112 on Tuesday, April 11 2006 @ 03:36 PM EDT
    Arbitration may in fact move this along much faster than the IBM case. I am not
    familiar with the International Chamber of Commerce but I have participated in a
    number of American Arbitration Association proceedings, they can move pretty
    quickly.

    This could create a serious problem for SCOG.
    Rulings by an Arbitrator are generally enforcable, but I'm not sure they can
    apply to other cases.

    This is really interesting development, unfortunately most of the arbitration
    will probably be confidential.


    ---
    Rsteinmetz - IANAL therefore my opinions are illegal.

    "I could be wrong now, but I don't think so."
    Randy Newman - The Title Theme from Monk

    [ Reply to This | # ]

    Answer with Counterclaims
    Authored by: lordshipmayhem on Tuesday, April 11 2006 @ 03:40 PM EDT
    That's quite the shopping list of affirmative defences: "Here, Your Honor,
    take your pick..."

    In this corner, Novell's legal team, also known as the U.S. Navy's Fifth Fleet.
    In the shiny yellow rowboat in THAT corner, er, SCOX.

    I do wonder what took Novell so long: did they deliberately wait until SCOX's
    discovery in the IBM case was over, to ensure against any SCOX
    "gotcha" legalistic sleight-of-hand?

    [ Reply to This | # ]

    "Oh what a tangled web we weave,
    Authored by: tangomike on Tuesday, April 11 2006 @ 03:40 PM EDT
    when at first we practice to deceive" - Shakespeare, Twelfth Night.

    Nice to see this still holds true.

    How long ago did Novell buy SUSE?



    ---
    Deja moo - I've heard that bull before.


    [ Reply to This | # ]

    Arbitration: some rules and differences
    Authored by: AllParadox on Tuesday, April 11 2006 @ 03:42 PM EDT
    U.S. courts like to rely on arbitration to solve problems. Arbitration is
    usually comes up because it is required by a contract term, and our courts
    enforce the term.

    It is very hard to get around contract terms requiring arbitration. They are
    easy to write, and are favored by the courts.

    Arbitration can proceed several ways. A common procedure, used by the AAA
    (American Arbitration Association), is for the AAA to submit a panel of three
    arbitrators, and each party is allowed to strike one arbitrator. The remaining
    arbitrator decides the case, and effectively has the power of a judge, often
    including the power to hold someone in contempt.

    Arbitrations are usually expedited. There are no jury trials in arbitration.
    The arbitrator is usually an experienced trial attorney, and I have known
    several. The arbitrator is sort-of bound by rules of fair play. Arbitration
    rules of procedure are informal.

    Arbitration is done privately, and the public is usually excluded. I have never
    heard of an arbitration being performed publicly.

    There is no appeal from an arbitrator's judgment. I do not know if proof of
    active fraud would be enough to set aside an arbitration award.

    So there you have it: expedited private hearing, no jury, no appeal.

    I personally have a lot of problems with them because of the loss of
    constitutional rights, usually imposed by an over-reaching party to the
    contract. If you want to sell stock on the stock market, you will sign a
    contract with an arbitration clause. It is not optional.

    As long as it is not me, or my family, it is great. This will be resolved
    fairly quickly: SWAG of six to nine months.

    ---
    PJ deletes insult posts, not differences of opinion.

    AllParadox; retired lawyer and chief Groklaw iconoclast. No legal opinions,
    just my opinion.

    [ Reply to This | # ]

    Novell Files Motion to Stay, Answer with Counterclaims etc.
    Authored by: Yossarian on Tuesday, April 11 2006 @ 03:43 PM EDT
    >SCO could have saved us all a lot of trouble,
    >don't you think, if it had read and understood
    >the GPL before it started all this?

    SCO could save *itself* a lot of troubles had it thought
    first and acted later.

    E.g. had SCO just posted all its proof of copying from UNIX
    to Linux on one of the Linux mailing lists then it could get
    *free* analysis of its claims from the free software
    community. If it had a case then Linus would remove the
    "bad parts" and SCO could make $$$ selling licenses to
    Linux users who would want to stay with what they had.

    (If SCO did not have a case then it could just pull the
    knife out of our collective back and say "Gee, I had no
    idea that it could cause some itch.")

    [ Reply to This | # ]

    Converting the PDF's to HTML
    Authored by: ChasF on Tuesday, April 11 2006 @ 03:49 PM EDT

    I've just tried out some new software and it's taken 5 minutes for me to convert the 8 page document to HTML 4.0. The generated HTML is quite complex because it replicates the page format exactly.

    I have two questions:

    1. Since I haven't prepared documents for Groklaw before, are there some guidelines for what the site supports?
    2. Do you want both documents converted?

    Thanks, Charles.

    [ Reply to This | # ]

    We these guys just never get it?
    Authored by: Anonymous on Tuesday, April 11 2006 @ 04:07 PM EDT
    <extreme sarcasm>
    I'm talking about IBM and Novell. IBM thinks it can get out from under all of
    our charges because we weren't specific enough in our complaint. But they KNOW
    what code they illegally put in Linux.

    Likewise, Novell KNOWS what "applicable unfair-competition laws" it
    broke by claiming it still owned UNIX and UnixWare.
    </extreme sarcasm>

    Come on SCO, we (and I wish the courts too) are getting sick of these vague
    things you are charging. I would say put up or shut up, but I know all you will
    do in the end is shut up....and I just can't wait.

    [ Reply to This | # ]

    Mitigation of Damages
    Authored by: Anonymous on Tuesday, April 11 2006 @ 04:15 PM EDT
    I still do not get this, I see it is brought up again by Novell.

    Isn't the only way SCOG could have mitigated its damages was to come out and say
    exactly (with specificity ;-) what the code was that had been illegally cloned
    into Linux?

    If I say that you stole something from me, and you are now getting
    "value" out of it, and I am not can I sue you without saying exactly
    what you took?

    I completely understand the argument "if we said what it was, it would be
    removed". But didn't they fail to think that removal of this code at that
    time (back in 2003, IF IBM had done this) would not negate any claims that they
    would have on lost business, etc?

    Did they really think they were just going to allowed this code to remain so
    that they could annually charge a licensing fee? Can they really be that dumb?

    [ Reply to This | # ]

    Okay, wait, wait, please clarify
    Authored by: Anonymous on Tuesday, April 11 2006 @ 04:34 PM EDT
    Okay... maybe I'm just confused, but... do I actually understand this right? It looks here like if Novell gets their motion:
    1. SCO's claims against Novell will be stayed
    2. Novell's counterclaims against SCO will proceed as if nothing had happened
    So basically all parts of the case that SCO wants to proceed stop, and the parts that SCO doesn't want, get to go forward? Wow. SCO has really painted themselves into a corner here.

    [ Reply to This | # ]

    What about the other motions?
    Authored by: Anonymous on Tuesday, April 11 2006 @ 04:37 PM EDT
    Wasn't there a motion some six months ago asking for a large pile of money be
    set aside as some sort of trust for novell, in case sco ran out of cash? Is that
    and other motions affected by this arbitration?

    In general, it seems I'm missing something - why arbitration now after two years
    since the slander of title charge from sco?

    [ Reply to This | # ]

    Novell Files Motion to Stay, Answer with Counterclaims etc.
    Authored by: Bill The Cat on Tuesday, April 11 2006 @ 04:41 PM EDT
    I see in the Answer to SCO's 2d Amended Complaint and Counterclaims that Novell
    again asks the court: "Novell seeks an order from this Court imposing a
    constructive trust on revenues received by SCO from its new SVRX Licenses with
    Sun and Microsoft and from its Intellectual Property Licenses with Linux end
    users and Unix vendors"

    How many requests does it take for the court to do this and why has the court
    been quiet about their previous request?


    ---
    Bill Catz

    [ Reply to This | # ]

    The overall tone
    Authored by: PeteS on Tuesday, April 11 2006 @ 05:14 PM EDT
    is that we have recently enjoyed with the latest IBM responses. Indeed, it is clear from the filings that Novell and IBM have been co-operating.

    I rather liked this:

    43. Novell admits that Section 1.6 of the APA contains the text quoted by the Second Amended Complaint, in addition to other language not quoted by SCO

    (Italics mine)

    I would note that the business world does take note of these filings (although one might be excused for disbelieving based on the average mainstream press) and the tone won't exactly help SCOX.

    On another note, the SCOX stock was being pumped (indeed, painted) heartily earler today, quite probably because they knew this was coming.

    PeteS

    ---
    Artificial Intelligence is no match for Natural Stupidity

    [ Reply to This | # ]

    Affirmative Defenses
    Authored by: Anonymous on Tuesday, April 11 2006 @ 05:41 PM EDT
    I just read through the Novell filing and my goodness, those affirmative
    defenses read like a laundry list. It seemed odd to me, that in a document
    wherein every single other detail was specified and explained to the nth degree,
    the affirmative defense section would essentially just be a list of legal
    principles with no indication of how or why they apply or what relevance they
    have to the case of Novell and SCO.

    Is the justification for under what facts and law the doctrines of Comparative
    fault, Laches, the U.S. Constitution, etc, present in some other filing which is
    past or yet to come? When does Novell explain themselves there, or do they not
    have to do that until trial? I was looking forward to that bit, it looked like
    entertaining reading.

    [ Reply to This | # ]

    Out of the frying pan, into the fire
    Authored by: Hop on Tuesday, April 11 2006 @ 05:46 PM EDT
    I'm pretty sure Novell has been planning this for a long time.

    [ Reply to This | # ]

    What's up with the First Ammendment? Any guesses?
    Authored by: Anonymous on Tuesday, April 11 2006 @ 05:52 PM EDT
    How could defense in a civil suit involve the First Amendment? It places limits
    on what Congress can do. Is Novell perhaps claiming that SCO is applying a law
    whose effect is limited by the First Amendment? If so, would the court have to
    (perhaps partially) invalidate the law in order to accept this defense?

    [ Reply to This | # ]

    Am I missing something ?
    Authored by: Anonymous on Tuesday, April 11 2006 @ 06:56 PM EDT
    What has United Linux got to do with SCO's copyright claims ?

    [ Reply to This | # ]

    Looks like Novell want to see SCO die slowly and painfully
    Authored by: Anonymous on Tuesday, April 11 2006 @ 07:29 PM EDT
    A few months back it seemed that maybe Novell wanted to deprive IBM of the
    satisfaction of gutting SCO, by just closing them down over their failure to pay
    due royalties (Novell's motion to attach SCO's earnings).

    Looks like they've decided that would be too quick a death.

    The phrase "You hold them down while we stick it to 'em" may possibly
    have come up in chats between IBM and Novell's lawyers?

    [ Reply to This | # ]

    Everything is timing
    Authored by: Anonymous on Tuesday, April 11 2006 @ 09:10 PM EDT
    Caldera bought Unix assets from Santa Cruz Operation in May 2001. United Linux
    was formed in May 2002. So when Caldera/SCO entered the contract they had owned
    the Santa Cruz assets for a year. That's long enough that they had time to
    understand the nature of those assets. They can't claim that anyone slipped
    anything over on them.

    I'm a little unclear on how this settles the slander of title issue. It seems
    to settle the issue of Unix code being in Linux. Any copyrighted Unix code that
    might be in Linux is now licensed to be there. OK but that doesn't settle the
    ownership of the copyrights of any Unix code that isn't in Linux.

    Might this moot IBM's counterclaim 10? Does it mean that counterclaim 10 would
    be automatically granted?

    [ Reply to This | # ]

    Arbitration and SCO's fee cap
    Authored by: Anonymous on Tuesday, April 11 2006 @ 10:24 PM EDT
    Is Arbitration (in Switzerland???) covered by SCO's legal fee cap?

    Anybody know?

    Quatermass
    IANAL IMHO etc

    [ Reply to This | # ]

    Final Nail in the coffin
    Authored by: iraskygazer on Tuesday, April 11 2006 @ 11:14 PM EDT
    It seems that Novel has pulled out the big hammer and is driving the last nail
    into the lid of SCO's coffin (oh I meant case ;-)

    [ Reply to This | # ]

    Questions
    Authored by: Anonymous on Tuesday, April 11 2006 @ 11:41 PM EDT
    IANAL
    1. Why did Novell wait until now to do this? My own first guess is they waited
    out fo deference to IBM who would like to establish once and for all that Linux
    code is clean. Perhaps IBM may have wished to see some discovery deadline
    expire first. Fearing perhaps that the issue may have become mooted if Novell
    moved too soon.

    2. Can SCO also ask for arbitration of Novell's counterclaims? Would it offer
    SCO exec's a chance to avoid criminal liability.

    3. Who gets the carcass of SCO? It may have much to do with the pursuit of
    criminal liability. Either IBM or Novell could use it against SCO execs or
    Microsoft.

    [ Reply to This | # ]

    SCO's Copyright claims (through the ages)
    Authored by: sk43 on Tuesday, April 11 2006 @ 11:45 PM EDT
    In case it might help, here is a side-by-side (arranged
    vertically) comparison of SCO's claims of
    copyright violations in Linux as presented in different communications
    and venues over the past few years:

    -----------------------
    SCO Forum, Aug 2003

    Literal copying
    [SGI contributed code from Sys V]
    Obfuscation
    [LBL Berkeley Packet Filter code]
    Derivative Works
    NUMA
    RCU
    JFS
    XFS
    Schedulers
    Linux PPC 32- and 64- bit support
    Enterprise Volume Management System
    Non-literal Transfers
    Per CPU counters

    -------------------------------------
    "Letter to Unix Users," Dec 2003

    errno.h
    signal.h
    stat.h
    ctype.h
    ctype.c
    ioctl.h
    ioctls.h
    ipc.h
    acct.h
    a.out.h
    ecoff.h
    bsderrno.h
    solerrno.h

    --------------------------------------
    AutoZone lawsuit, Mar 2004

    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 LightweightProcesses (kernel threads)
    User level threads; and loadable kernel modules

    ---------------------------------------
    Novell lawsuit, Dec 2005

    Read/Copy/Update" algorithm
    NUMA Aware Locks
    Distributed lock manager
    Reference counters
    Asynchronous I/O
    Kmalloc data structure
    Console subsystem
    IRQs
    Shared memory locking
    Semaphores
    Virtual memory
    IPC's
    Load balancing
    PIDs
    Numerous kernel internals and APIs
    ELF
    STREAMS
    Dynamic linking
    Kernel pre-emption
    Memory mapping
    ESR
    Buffer structures
    Process blocking
    Numerous header files

    ----------------------------------
    [For the sake of clarity, I omit SCO's apocryphal "Exhibit G",
    a.k.a. IBM-157-28-G.pdf]
    ---------------------------------

    One cannot help but notice a singular lack of "economy of scale" -
    i.e.,every iteration is so different from the last
    that one can hardly, if at all, match them up. No wonder
    SCO has burned through it pile of PIPE-generated cash so fast.

    [ Reply to This | # ]

    Protection of computer spyware
    Authored by: Anonymous on Wednesday, April 12 2006 @ 04:36 AM EDT
    Does "Computer Spyware protection Act" means, that Computer Spyware
    will be legalised and protected by law?

    [ Reply to This | # ]

    • Yes! N/T - Authored by: Winter on Wednesday, April 12 2006 @ 04:57 AM EDT
    I never worked for lawyers as good as these guys, and it's a plumb pleasin' pleasure to watch
    Authored by: Anonymous on Wednesday, April 12 2006 @ 01:25 PM EDT
    I guess you've worked for some pretty cruddy lawyers, because I thought that the
    counter-claims were made "shotgun" style. I mean, geez...I am
    surprised that they didn't throw in the affirmative defense of latches!

    [ Reply to This | # ]

    Never Mind the Rest, Check Out That 10th Affirmative Defense
    Authored by: Anonymous on Wednesday, April 12 2006 @ 02:06 PM EDT
    IANAL, but something tells me that Novell accusing TSG of Fraud against the
    Copyright Office is going to be a whole new side show in this legal circus.

    Obviously a lot will depend on the way that this evolves, but instinct suggests
    to me that if this Court were to find in favour of Novell for the 10th
    Affirmative Defense - Fraud against the Copyright Office, then surely the said
    Copyright Office would have a legal obligation to investigate the findings of
    this Court? Should that happen, the TSG [which one presumes might be the
    Directors of the Company] would be charged with Fraud...

    PJ, when you described these as "killer" affirmative defenses, you
    most certainly were not joking, were you?

    - - -

    Slightly different topic now - with a question. There are quite a few comments
    now appearing in this thread that observe that Novell and IBM "might be
    collaborating" - I'm carefully choosing my own description here - on their
    respective legal actions. Obviously there is nothing improper about that - each
    party holds information relevant to the case being contested by the other, so
    one presumes that a Court would not penalise either for that unless there were
    good reason for it. What I'm interested in, however, is how this might
    materially affect strategy.

    This recent activity by Novell has also encouraged PJ to write that she
    believe's we're witnessing truly remarkable legal work. We've also seen [think
    the GPL/Copyright pincer movement] outstanding work from C, S & M in their
    defense of IBM. I wonder if any of the more legally-experienced would be able to
    explain in more detail the way that these two companies could usefully cooperate
    to build a strategy to effectively contain TSGs nonsense?

    Obviously, it seems to me that if TSG can be goaded into making a statement in
    one case that can be used in the other, then this will be "used against
    them in a court of law". But if there is one thing I've learned from both
    IBM and Novell, it is that they are way more subtle than that!

    So, we've had some good discussion and speculation on where lots of this is
    going, but would anyone care to "imagine" a joint IBM/Novell legal
    strategy meeting???

    [ Reply to This | # ]

    The SCO killer
    Authored by: DaveJakeman on Thursday, April 13 2006 @ 06:48 AM EDT
    From the Memorandum in Support:

    'SCO's copyright infringement claim is wholly dependent on the results of the
    arbitration in three critical respects. First, SCO's copyright claim requires
    SCO to prove that it owns the copyrights at issue. However, SuSE has asserted
    in the arbitration that SCO does not own these copytights because the
    UnitedLinux contracts transferred any such copyrights from SCO to UnitedLinux
    LLC.'

    Novell is saying that the UnitedLinux contract automatically transfered the Unix
    copyrights, whether owned by SCO or whether owned by Novell, to UnitedLinux LLC.
    So, even if SCO owned the UNIX copyrights, SCO no longer own the UNIX
    copyrights (as far as technology that was transferred to UnitedLinux goes).
    Tough cookies. One question remains: what UNIX technology was transferred to
    UnitedLinux and what proportion of the UNIX copyrights would that transfer?

    'Second, SuSE has asserted in the arbitration that the UnitedLinux contracts
    confer a broad, royalty-free license on SuSE to use any intellectual property
    rights of SCO in the UnitedLinux technology, including the right to sublicense
    such technology to others.'

    My take: SuSE may do anything it wants in UnitedLinux with SCO's IP, including
    (for example), releasing it under the GPL.

    "Third, SuSE has asserted in the arbitration that the UnitedLinux contracts
    obligate SCO to comply with any open source licenses, including the
    "General Public License" that requires modified versions of the Linux
    "kernel" to be made freely available to the public. SCO's
    infringement claim appears to be directed against technology included in the
    UnitedLinux kernel. Thus, if the Arbitral Tribunal agrees that the UnitedLinux
    contracts requires SCO to make the Linux kernel freely available, this would
    require dismissal of SCO's infingement claim."

    Pretty well speaks for itself.

    So, after obtaining the required result in arbitration, the dominoes start to
    tumble. First, the rest of SCO's claim against Novell, rippling outwards to SCO
    vs IBM and beyond. Hold onto your seats.

    ---
    SCO: hunting for snarks in an ocean of sharks
    ---
    Should one hear an accusation, first look to see how it might be levelled at the
    accuser.

    [ Reply to This | # ]

    SCO Group is the Lindon chapter
    Authored by: Wesley_Parish on Thursday, April 13 2006 @ 07:18 AM EDT

    of ARDDA - the Association of Recreational Drano Drinkers of America.

    Is there any other explanation for such plainly suicidal business behaviour?

    ---
    finagement: The Vampire's veins and Pacific torturers stretching back through his own season. Well, cutting like a child on one of these states of view, I duck

    [ Reply to This | # ]

    We own the copyrights, but let us ask Novell
    Authored by: GLJason on Friday, April 14 2006 @ 08:05 AM EDT
    SCOX claims to be the sole owner of Unix Copyrights, yet the sections from the APA clearly restrain some of those copyrights. For instance, if you are the owner of a copyright you may grant any of those rights to another entity. Novell clearly has sayso over SCOX's rights in this regard.
    ... [SCO] shall not, and shall have no right to, enter into new SVRX Licenses exceptin the situation specified in (i) of the preceding sentence... ((i)as may be incidentally involved through its rights to sell and license UnixWare software or the Merged Product).
    When taken in this light, the meaning of Amendment 2 to the APA (which SCO tries to claim caused a transfer of all copyrights) becomes clear:
    All copyrights and trademarks, except for the copyrights and trademarks owned by Novell as of the date of the Agreement required for SCO to exercise its rights with respect to the acquisition of UNIX and UnixWare technologies. ...
    Novell is still specifically excluding "All copyrights and trademarks", except the ones SCO needs to exercise the specific rights granted to it in the agreement. What rights were those? The rights to develop the "Merged Product", or UnixWare. That is all that SCO bought, the right to create and market UnixWare. I think the problem is that SCO is misreading the term "copyright". Copyright isn't like a trademark or patent. Copyrights are multiple. You don't just 'own' the 'copyright' on a work, copyrights are sets of exclusive rights granted to the creator. The creator can sell or transfer any or all.

    Now ask yourself what "copyrights" would SCO need that required specification in amendment 2 here? Think about it, they are buying the right to create and market UnixWare, which contains UNIX SVRx code. Without amendment #2, SCO couldn't have even loaded UnixWare on a single computer because Novell was denying them those "copyrights" in the excluded assets. By amendment 2, they were only clarifying that SCO could indeed develop the merged product and could copy and use the code from Unix SVRx that is included. Also they would need to be able to make copies of CDs and such to hand out to the existing Novell SVRx licensees since they would be administering those licenses.

    Indeed, those are the only copyrights "required for SCO to exercise its rights with respect to the acquisition of UNIX and UnixWare technologies". They certainly don't need all the exclusive rights, just the right to copy and create derivative works, and a nonexclusive one at that.

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