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Two More Objections -- from the US Trustee's Office |
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Friday, March 28 2008 @ 01:17 AM EDT
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Two more objections have been filed in Delaware Bankruptcy Court, this time by the US Trustee's Office, one an objection [PDF] to SCO's Disclosure Statement and another [PDF] to the plan to give SNCP oodles and boodles of money for nothing, or as the objection puts it to pay "bonus compensation" to SNCP "for providing a financing commitment of questionable value at an above-market cost." A "windfall" in short. Forsooth, methinks the worm has turned and these SCO motions are toast, m'lords.
The basis for the objection to the disclosure statement is inadequate information. There's no description of a business plan or descriptions of financial projections, the US Trustee points out, or any indication of the effect on SCO's future of an ultimately adverse ruling in the litigations. Then there's this: [H]ow much of the Debtors' business plan is predicated on the Debtors' use of property which Novell claims to be its own? Indeed. What a good question.
It has registered too that there is inadequate info about Stephen Norris Capital Partners. Do they actually have sufficient money "to provide -- or procure -- the exit funding commitment referenced in the disclosure statement", the objection asks? And here is another big question, one IBM asked also in its objection: Who are the proposed directors/officers of the reorganized Debtors, "their affiliations and the compensation to be paid to such persons"? Inquiring minds want to know. The US Trustee's Office and IBM are asking the one question that matters most: who's behind this really? They intend to smoke that information out, I gather. That should be fascinating. Then the US Trustee references IBM's objection, says it agrees with IBM, and asks the court to deny SCO's motion. Folks in the media who persist in asserting that SCO has a chance to win in the end or got a raw deal might like to take notice of this section: SCO reaffirms its belief that "it has an excellent chance to prevail in the Novell/IBM Litigation, including potential for an award of potential damages in its favor"... yet seeks to award SNCP one-half of the net proceeds if any of the Litigation Claims are resolved prior to the Effective Date, regardless of whether the Plan is confirmed. ... Given that the Debtors take the position that the Litigation Claims are valuable, they do not even attempt to argue that awarding one-half of the value of those claims to SNCP pursuant to a pre-Effective Date settlement represents the "actual, necessary cost[s]" of preserving the Debtors' estates.... I believe that is legalese for "The US Trustee's Office didn't just fall off a turnip truck." Of course, some SCO-supportive blogger may still write about how SCO is a victim of mob justice... Hahahaha. Maybe not this time. The US Trustee's Office works for the US Department of Justice.
Here are all the filings: 416 -
Filed & Entered: 03/27/2008
Affidavit/Declaration of Service
Docket Text: Affidavit/Declaration of Service of Kimberly A. Beck re: Docket Nos. [410], [411], [412] and [413 (related document(s)[410], [413], [411], [412] ) Filed by Novell, Inc.. (Greecher, Sean)
417 -
Filed & Entered: 03/27/2008
Affidavit/Declaration of Service
Docket Text: Affidavit/Declaration of Service re: Transfer/Assignment of Claim. Transfer Agreement 3001 (e) 1 Transferor: Shenyang Neusoft Co. Ltd To Riverside Claims LLC. (related document(s)[406] ) Filed by The SCO Group, Inc.. (O'Neill, James)
418 -
Filed & Entered: 03/27/2008
Objection
Docket Text: Objection to Debtors' Motion To Approve Settlement Compensation Or Sale Compensation And Expense Reimbursement to Plan Sponsor (related document(s)[346] ) Filed by United States Trustee (Attachments: # (1) Certificate of Service) (McMahon Jr., Joseph)
419 -
Filed & Entered: 03/27/2008
Objection
Docket Text: Objection to (a) the Debtors' Proposed Disclosure Statement and (b) the Debtors' Motion for an Order (i) Scheduling the Confirmation Hearing; (ii) Approving Form and Contents of Solicitation Package; (iii) Approving Form and Notice of the Confirmation Hearing; (iv) Establishing Record Date and Approving Procedures for Distribution of Solicitation Packages; (v) Approving Forms of Ballot; (vi) Establishing Voting Deadline for Receipt of Ballots; (vii) Approving Procedures for Vote Tabulations; (viii) Establishing Deadline and Procedures for Filing Objections to Confirmation of Plan; and (ix) Granting Related Relief (related document(s)[369], [394] ) Filed by United States Trustee (Attachments: # (1) Certificate of Service) (McMahon Jr., Joseph) This is getting to be fun again, don't you find?
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Authored by: devil's advocate on Friday, March 28 2008 @ 01:23 AM EDT |
Is it fun to ask questions of the undead as the soil is shoveled on their
coffin? They may shout and cry out that they deserve to live, that they have
much yet to do, but who listens? Somehow I think the fun has gone out of it. The
battle front has moved on, and it is called OOXML for now.[ Reply to This | # ]
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Authored by: Rastakins on Friday, March 28 2008 @ 01:23 AM EDT |
In the very unlikely event... [ Reply to This | # ]
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Authored by: Rastakins on Friday, March 28 2008 @ 01:25 AM EDT |
For those who just want to talk about any old thing [ Reply to This | # ]
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Authored by: Rastakins on Friday, March 28 2008 @ 01:31 AM EDT |
Sort of on-topic because they do appear on the home page but sort of off-topic
because they don't involve SCO.[ Reply to This | # ]
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Authored by: Anonymous on Friday, March 28 2008 @ 01:37 AM EDT |
microsoft (proven via emails uncovered during the Iowa antitrust case) is
probably available -
in fact, SCOG was paying her for something -[ Reply to This | # ]
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Authored by: Anonymous on Friday, March 28 2008 @ 02:31 AM EDT |
After all, we know that the trustee's attorney must be a representative for a
consortium of 15 PJs which are, in turn, of course each based off of the input
and work product of 13 IBM lawyers.
Mob justice wins after all.
[P.s. if you dont catch the whiff of sardonic sarcasm here, prepare for the
clue bus ;) ]
---
Clocks
"Ita erat quando hic adveni."[ Reply to This | # ]
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Authored by: Anonymous on Friday, March 28 2008 @ 02:54 AM EDT |
Every time I read one of the Trustee filings it seems to be on a completely
different level from the normal correspondence -- like everyone else, even the
very shrewd and talented people from IBM and Novell, are just playing at law,
and this is how it's *really* done.
Granted, the lawyers for IBM & Novell have had to do a lot more tough
sledding,
but the efficiency and eloquence of the Trustee's work are uniquely impressive.[ Reply to This | # ]
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Authored by: kawabago on Friday, March 28 2008 @ 03:13 AM EDT |
Their re-organization plan is to borrow more money to keep doing the things that
ruined the business in the first place. It's hard to see how that's going to
floink flap oink flap flap oink flap flap.[ Reply to This | # ]
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Authored by: ak on Friday, March 28 2008 @ 04:05 AM EDT |
PJ wrote:
some SCO-supportive blogger may still write about how SCO
is a victim of mob justice... ... Maybe not this time. The US Trustee's Office
works for the US Department of Justice.
This does not logically
preclude mob justice. But I agree that it is unlikely that the current US
Department of Justice is interested in acting against SCO.
[ Reply to This | # ]
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Authored by: Anonymous on Friday, March 28 2008 @ 05:32 AM EDT |
Isn't it about time that Darl called a press conference to complain about the
mob of long-haired smellies that conspired to turn the whole American justice
system against his poor little company?[ Reply to This | # ]
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Authored by: DaveJakeman on Friday, March 28 2008 @ 07:29 AM EDT |
IBM: [Rigour="Maximum"] SCO's reorganisation plan is inadequate and
not good for IBM, nor Novell.
Novell: [Disdain="Maximum"] SCO's reorganisation plan is inadequate
and not good for Novell, nor IBM.
Trustee: [Concision="Maximum"] SCO's reorganisation plan is inadequate
and not good for SCO, Novell, nor IBM. And who do they think they are kidding?
Porcus volatus terminus
---
Monopolistic Ignominious Corporation Requiring Office $tandard Only For
Themselves[ Reply to This | # ]
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Authored by: Anonymous on Friday, March 28 2008 @ 09:41 AM EDT |
Can SCO get in trouble for saying details on March 20. Then failing to provide
said details on the 20th or even filing anything to say they need an extension.
Especially when those details were really needed to make the original filing
complete.
It really seems like this was a bald face game the court filing.
"We want to do X, we will tell you why later. But for now just let us do
X."
[ Reply to This | # ]
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- contempt? - Authored by: PJ on Friday, March 28 2008 @ 10:07 AM EDT
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Authored by: snakebitehurts on Friday, March 28 2008 @ 09:43 AM EDT |
What poetic justice!
419 is the common term used for the "Nigerian scam" which usually
begins with "Dear Beloved, ....you will soon get bazillions of
dollars......"
The US Trustee got the #419 filing,
Perfectly fitting, especially reading the the contents. :)[ Reply to This | # ]
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- Trustee gets 419 - Authored by: Anonymous on Friday, March 28 2008 @ 01:09 PM EDT
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Authored by: Anonymous on Friday, March 28 2008 @ 10:04 AM EDT |
Every time SCO has done this nonsense a pile of money is flushed down the drain
paying attorneys to look over this stuff that ultimately gets rejected. The
court should put an end to this by requiring that SCO use a process where the
court is informed first and is then given permission to proceed and spend some
money. It appears that SCO is just trying to enrich anyone they can before the
die, as long as that list doesn't include any of their real creditors.[ Reply to This | # ]
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Authored by: 34CFR20USC on Friday, March 28 2008 @ 10:19 AM EDT |
You know, it can't be good when the Trustee shoots your motion in the soft
parts.
---
I am not an attorney. I'm just a lowly researcher who is a law groupie. I
don't offer advice, but I ask a lot of questions.[ Reply to This | # ]
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Authored by: red floyd on Friday, March 28 2008 @ 11:17 AM EDT |
n/t
---
I am not merely a "consumer" or a "taxpayer". I am a *CITIZEN* of the United
States of America.
[ Reply to This | # ]
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Authored by: fuego451 on Friday, March 28 2008 @ 11:30 AM EDT |
This is getting to be fun again, don't you
find? No doubt this is the kind of case lovers of the 'law'
live for but I find it an incredible waste of time and resources involving laws
that seem fairly straight forward on their surface but are open to complexity of
interpretation and ambiguity of intent and often populated with people on one
side or the other who, for all the good they have accomplished, might just as
well never have been born. Yes, I come to Groklaw several times a day to
read the latest absurdity in SCO vs World but I'm mainly looking for that line
spoken by Bones, "It's dead Jim." This, in no way, detracts from my
immense admiration for PJ, her love of truth and justice, her courage and
conviction and all she has accomplished with Groklaw. [ Reply to This | # ]
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- Fun? - Authored by: PJ on Friday, March 28 2008 @ 11:32 AM EDT
- Fun? - Authored by: fuego451 on Friday, March 28 2008 @ 12:05 PM EDT
- That depends... - Authored by: Anonymous on Friday, March 28 2008 @ 01:31 PM EDT
- Fun? - Authored by: UD on Friday, March 28 2008 @ 12:50 PM EDT
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Authored by: rsteinmetz70112 on Friday, March 28 2008 @ 02:49 PM EDT |
Weren't they supposed to fine their definitive documents by now?
I wonder if in this chorus of objections they will withdraw their motion.
---
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 | # ]
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Authored by: Anonymous on Friday, March 28 2008 @ 03:18 PM EDT |
In all the BS being strewn around about 'reorganization' and 'valuable
litigation' going forward, it's good to see the Trustee remind why this is all
coming about...
"...in light of the Debtors’ dismal operating history..."[ Reply to This | # ]
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Authored by: bezz on Friday, March 28 2008 @ 03:50 PM EDT |
There are phrases in 418 that suggest the US Trustee has seen
enough:
At paragraph 4
Contrary to applicable law,
the Plan Sponsor Protections are bonus compensation to SNCP for providing a
financing commitment of questionable value at an above-market
cost.
At paragraph 5
Second, the Debtors
also seek to permit SNCP to “participate directly in any settlement discussions
relating to the Novell/IBM Litigation.” Mot. ¶ 8. SNCP is interested in
maximizing its own recovery and minimizing its downside risk, which means that,
in light of the Debtors’ dismal operating history, SNCP has every
incentive to instruct SCO to adopt a settlement strategy which favors settlement
of its Litigation Claims prior to the Effective Date on terms which obviate the
need for the firm to provide the promised financing (i.e., a settlement
involving a sale
of the company), regardless of whether that result aligns with
the estates’ interests or Novell’s/IBM’s interests.
At
paragraph 7
the Debtors agreed to a “no-shop” or a “window-shop”
provision in the MOU (see “Restrictions on Affirmative [sic] Seeking Competitive
Transactions,”
pg. 13 of MOU (Ex. A. to the Motion). The “no-shop” or
“window-shop” provision is not described
in either the Motion or the proposed
form of order as a “Plan Sponsor Protection” (paragraph 2 of the proposed form
of order). The provision prevents SCO from “solicit[ing] or encourag[ing]
submission of inquiries, proposals or offers from any third parties regarding
any potential financing
of a plan of reorganization for SCO” until August 15,
2008 (each such inquiry, etc., a “Competitive Transaction”). A “determination”
by SCO or SCO’s board of directors to “pursue” a Competitive Transaction is
grounds for terminating the financing arrangements. There is no discussion of
the justification – factual or legal – for the Debtors’ request for approval
of this term.
It looks like SCO has finally demonstrated to the
Trustee that it can not emerge from BK successfully. The plan does not describe
future cash flows; SCO has a proven track record of losing money and the Mobile
products foisted on the court as a potentially HUGE growth area are demonstrably
proven to be a poor source of revenue and likely another cash drain. SCO has
not demonstrated SNCP has the money, and even if it does, the plan is not in the
best interest of the estate or creditors; to the contrary, SNCP is being given
the power to act in a way NOT in the best interest of the estate or creditors at
an excessive cost of financing. And finally, the plan precludes SCO from
talking to other third parties to get a better deal without providing any legal
basis for the term.
A Chapter 11 DIP gets every benefit of the doubt and
that is only fair. It is in everyone's best interest to have a company emerge
from Chapter 11 and satisfy its creditors to the maximum extent possible.
However, companies with no real potential to emerge from Chapter 11 can't get
financing at fair terms; they are forced to accept the kind of garbage York and
SNCP offered. Those terms invariably protect the new lender's interests at the
expense of the estate and creditors.
This is the second unacceptable
financing plan SCO has offered. We will see a motion to move to Chapter 7 once
Utah is done. The race is on. Will SCO run out of cash before a judgement in
Utah is issued? Either way, this is going to go Chapter 7 and the Trustee won't
object to the motion. [ Reply to This | # ]
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Authored by: Anonymous on Sunday, March 30 2008 @ 01:16 PM EDT |
The "What is tSCOg smoking?" filing.
:-)
(For those not aware, 420 is cop-speak for cannibis.
http://en.wikipedia.org/wiki/Cannabis)
[ Reply to This | # ]
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