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Day 2 of the Novell v. SCO trial - Updated 6Xs
Wednesday, April 30 2008 @ 08:38 PM EDT

I just heard from Chris Brown and there's a docket entry from Day 2 of the SCO v. Novell, now morphed into Novell v. SCO, trial. Today was also the hearing in the afternoon on the summary judgment motions. We'll have a longer report from Chris, and I think others, to follow. Darl took the stand today, called by Novell.

Here's Chris's first word:
I've just returned from the courthouse of the second day of the SCO v. Novell trial as well as the summary judgment hearing. I have transcripts from yesterday's hearing which I will send ... momentarily.

Ah, transcripts. Hmm. How shall I say this... just yesterday was $247.20. That's about $50/hr of trial. Today was probably over 6 hrs and there's about 10 hours left... Can we afford transcripts? It would seem the entire trial would come in at about $1,000. Wow.

Let me know what you want me to do.

Today we heard some really interesting testimony. Novell finished questioning Chris Sontag, called Darl McBride (SCO's CEO for those few who don't know) and Greg Jones (VP of Technology Law at Novell), and then Novell rested. SCO called John Maciaszek (Unix Product Manager for Unix System Labs, Novell, Santa Cruz, and The SCO Group).

Then there was the Summary Judgment hearing where we heard both sides argue both motions and yet they were done in less than an hour.

Reports to follow.

I will leave it up to everyone here. If you want full transcripts, we'll need to pass the hat. I used what you donated to send someone to cover the trial. I'll also inquire at the courthouse. Sometimes it's cheaper if you wait until one of the parties orders first. While we think it over, here's the court docket entry:

531 - Minute Entry for proceedings held before Judge Dale A. Kimball: Bench Trial held on 4/30/2008. Court opened at 8:28 AM with all parties present. Testimony of witnesses was heard and evidence rec'd. Deposition of Greg Jones was published. Novell rested its case. Mr. Singer moved for involuntary dismissal; the Court took the motion under advisement without hearing argument at this time. SCO began presenting its case. Court recessed at 2:08 PM. Attorney for Plaintiff: Stuart Singer, Edward Normand, Jason Cyrulnik; Attorney for Defendant: Michael Jacobs, Eric Acker, David Melaugh. Court Reporter: Kelly Hicken/Becky Janke. (kmj) (Entered: 04/30/2008)

To refresh your memory, here are the two summary judgment motions, first Novell's:

Now SCO's motion:

Update: You guys are the best! We have enough to get the transcripts. And then some! I'm so happy. I was trying to be a grownup, but thinking of not having them was hard. So thank you so much for helping.

Update 2: And here's a second eyewitness account, telling us that today was a lot more fun than yesterday:

Judge Kimball had suggested that SCO and Novell keep their boxes and exhibits in the courtroom overnight, and the courtroom felt a little full. The public area had about 15 people in it today. Court went from 8:30 AM to about 2:05 PM with two 15-minute breaks. The summary judgments were then heard from 3:00 PM to about 3:45 PM. Michael Jacobs, Eric Acker, and David Melaugh argued for Novell, and Stuart Singer and Edward Normand argued for SCO.

When I arrived a little after 8:00 AM, SCO's team was already in the room and had brought in more boxes. There was so many boxes that the stack of boxes was as high as the divider between the public area and SCO's table. Every time one of the SCO attorneys, other then Mr. Singer, needed to go to the podium to speak, Mr. Singer had to get out of his chair so they could pass by, because there was not enough room to pass behind him. There was always a little bit of commotion at their table whenever this happened.

The SCO legal team started off a little more polished then Tuesday, but things deteriorated several times. Once, their AV system failed, and several times Mr. Normand was questioning Mr. Jones about an exhibit without giving him a copy of the exhibit they were asking questions about. Novell's Mr. Acker objected every time until the witness was given a binder with the exhibits. It seemed like Mr. Normand was winging it somewhat and did not have his exhibits well thought out.

The issue of entering exhibits into evidence was handled better today, but when Mr. Jacobs was giving his closing remarks before resting, he did ask Judge Kimball to enter several exhibits into evidence that were present by SCO which they did not ask to be entered into evidence. Mr. Jacobs also reserved the right to come back after checking the entered exhibits, if any other exhibits had not been entered.

Judge Kimball was a little more active today but only spoke up to keep the trial running in an orderly fashion. He seemed to be slightly smiling at times to himself, but it was impossible to tell what was on his mind.

Four witnesses appeared today. Chris Sontag, Darl McBride, and Greg Jones (VP of Technology Law at Novell) were called by Novell. After Novell rested SCO called John Maciaszek (Unix Product Manager for Unix System Labs, Novell, Santa Cruz, and Caldera/The SCO Group).

Mr. Sontag had recovered from Tuesday and quickly finished testifying. Mr. McBride was interesting to watch. He was somewhat defiant and combative at times. He talked at times like the summary judgment (the August 10 ruling) never happened. Mr. Jones was informative but had to work hard at not getting tricked into saying the wrong thing when being questions by Mr. Normand. Mr. Maciaszek was also interesting, but did not seem like an overly helpful witness for SCO.

The summary judgment hearing was short. The first motion heard was Novell's Motion for Summary Judgment on its Fourth Claim for Relief, and it was fairly brief. The second motion heard was for Judgment on the Pleadings on Novell's Claims for Money or Claim for Declaratory Relief. SCO used the majority of the time to make their arguments. Given that the hearing was under way, it did not seem like Judge Kimball needs to approve either one. It did seem like both SCO and Novell each made a better case for their respective motions.

Judge Kimball did say he had a conflict on Friday, and he wanted to start at 8:00 AM and end at 1:30 PM.

Today was more enjoyable over all. I am not as worn out today.

Remember yesterday, about the tree trunk and whether UNIX and UnixWare were the same thing? Someone sent me this article from way back when, June 16, 2003, and it makes it so, so clear that this "UnixWare and System V are the same thing" story SCO started telling after August 10 is not at all what they said when they believed they owned the copyrights. It's an article friom, an interview with Darl on why SCO decided to start suing, and here's what he said about that famous tree trunk, UNIX System V:

Where people get a little confused is when they think of SCO Unix as just the Unix that runs the cash register at McDonalds. We think of this as a tree. We have the tree trunk, with Unix System 5 running right down the middle of the trunk. That is our core ownership position on Unix.

Off the tree trunk, you have a number of branches, and these are the various flavors of Unix. HP-UX, IBM's AIX, Sun Solaris, Fujitsu, NEC--there are a number of flavors out there. SCO has a couple of flavors, too, called OpenServer and UnixWare. But don't confuse the branches with the trunk. The System 5 source code, that is really the area that gives us incredible rights, because it includes the control rights on the derivative works that branch off from that trunk.

Hilarious, no? Now they are telling the judge that all the value is in UnixWare, not System V.

Update 3: Our second reporter adds this note, which we'll understand better once we have the longer account:

These files were talked about today in court.

Note that Sun has open sourced AT&T's code on the links below:

diskusg.c

autopush.c

Update 4: Here's the longer report by Chris, and it's fascinating. My favorite part is SCO's demo problems resulting from an XP malfunction:

Today's trial continued with Chris Sontag still on the stand with Novell's Eric Acker conducting redirect. Mr. Acker asked Mr. Sontag if he's aware of any code unique to UnixWare that is in Linux (that is, code not present in SVR4.2 for example). Chris responded, circuitously, that he is not aware of such.

Regarding yesterday's discussion of the SCOTech program to license the libraries (to allow SCO compiled applications to run on Linux) Chris admitted no licenses had been issued under that program.

When questioned about the 2003 Sun Agreement and Sun's already having had licenses for the 30+ pre-APA Unix releases, Mr. Sontag admitted Sun wanted an agreement that would loosen the confidentiality provisions on those releases.

Chris Sontag stated that SCO stopped listing prior products licensed in contracts, but that such was implied. Mr. Acker showed a license to Cyberguard for UnixWare 7.0 from 1998 which called out prior products and only listed UnixWare 2.0 and 2.1. Chris agreed that in this particular case that appeared to be the case, but that he had been told by Bill Broderick that they were normally not included.

Mr. Acker then showed the Alps Electric Co. license, where there was a page entitled "Prior Products" followed by a note that the page has been "intentionally left blank." Mr. Acker asked if it wasn't true that these examples were inconsistent with his, Sontag's, testimony? Isn't it true that what you know of historical practices is based on what you've been told? Mr. Sontag agreed.

Mr. Acker then discussed the Microsoft agreement, and Chris Sontag stated that they were only interested in latest SCO products. Mr. Sontag further stated that he is not aware of Microsoft including any SVRX, OpenServer, or UnixWare code in any of their products.

SCO's Ted Normand then questioned Mr. Sontag. He first showed an exhibit, an agreement with NCR where only a recent UnixWare version appeared to be shown in the 1996 agreement, and he then displayed a 1997 document with NCR that listed all previous releases, asking Mr. Sontag to identify each.

When asked, Sontag characterized the Sun and Microsoft agreements as being about equal.

Novell's Eric Acker then asked Sontag again if he believes the Sun and Microsoft agreements are about equal, to which he agreed. Mr. Acker then asked if Microsoft can open source UnixWare, to which Chris Sontag stated that they cannot.

SCO's Mr. Normand asked, with respect to open sourcing, are they equal? This time Sontag responded that he's not a lawyer, doesn't know.

Novell then released Sontag and Mr. Acker then called SCO's CEO Darl McBride to the stand.

Mr. McBride testified that when he was hired in 2002, SCO was not profitable. He asked his top managers what they would do if they ran the company. One manager, John Terpstra, said he believed Unix was in Linux, that most of the company's efforts up to this time had been in Linux, but that most of the income was from Unix.

Mr. Acker then displayed a letter to SCO shareholders dated August 2002 and highlighted where it read "Caldera owns... IP rights to Unix" and further elaborated "our Unix Intel property includes Unix SVRX, UnixWare, and SCO OpenServer." Darl claimed that those were brands, not core assets. When asked "doesn't the core IP underlie all those brands?" Darl answered that it does.

Eric Acker showed SCO's "Tree View" on a SCO slide carrying the subtext "more than 3,000 Unix source code licenses." Mr. Acker pointed out that SCO UnixWare is a branch. Mr. McBride responded that UnixWare is unique in that the route to the trunk is through UnixWare. Mr. Acker follows up asking if he calls the core IP "System V" or "SVRX" which he answered yes.

Mr. McBride was asked whether or not all of the trunk exists in UnixWare to which he said "you'd have to ask the engineers." Has a study been done to determine that? Again, "you'd have to ask the engineers." He further elaborated that he worked at Novell for 8 years and knows it was a conscious choice to embody SVRX in UnixWare.

Mr. Acker cited a SCO description of SCOsource from January 2003 stating that the "core technology dates back to 1969" at AT&T. Darl agreed that part of it does date back that far.

Showing the letter Mr. McBride sent to Fortune 1000 companies, Mr. Acker asked about Unix System V source code having been copied into Linux. There was a back and forth exchange about if the letter directs the recipients to get a license from SCO, with Darl denying the letter does so. It does put the recipients on notice, but doesn't tell them to get a SCOsource license, he maintained.

Mr. Acker highlighted the example in the letter of SCO having initiated legal action against IBM, but Darl claimed the letter doesn't say SCO will sue them.

There was extended questioning about whether the 2003 Microsoft and Sun licenses were SCOsource, licenses with Darl McBride insisting they were UnixWare licenses, not SCOsource.

Eric then showed a letter from Novell's Mr. LaSala to Mr. McBride from 2003 where Mr. LaSala references 2.16.B of the APA and demands copies of the Microsoft and Sun agreements. Darl confirmed that he refused to provide copies.

Darl claimed that while SCO was a fiduciary of Novell's, it was not in respect to these licenses, that Novell had no standing to demand these licenses.

There was then a long, interesting, SCO description on how the dispute between SCO and Novell over SCOsource came about. Darl described Novell "carpet bombing" of SCO with legal letters. I can't adequately describe the descriptions, they're priceless. I recommend you read this in the forthcoming transcripts.

Eric Acker presented a February 5th, 2004 letter from SCO's Ryan Tibbits which Mr. Acker read as stating SCO's position back in 2003 was that Novell wasn't entitled to revenue from the Sun and Microsoft agreements because they were *new*, not existing licenses. Darl said all new licenses were UnixWare licenses and further that Novell was only entitled to pre-existing revenue sources.

Mr. Acker displayed the eWeek article from April 13, 2005 entitled "SCO gives Sun Blessings to Open-Source Solaris." On questioning Darl said he believes Sun's open-sourcing of Solaris is in accordance with their license from SCO.

Mr. Acker then asked Mr. McBride if he's always told the truth in SEC filings and 10Qs, to which Mr. McBride emphatically stated that he has.

Eric then displayed, and spent some time discussing, SCO's 10Q SEC filing (which I believe to be for the quarter ending April 30, 2003). In it, he drew Darl's attention to "we initiated the SCOsource offer to review the state of these [Unix] licenses..." And to the 10Q describing the Microsoft and the yet unidentified Sun agreements as SCOsource licenses. Further that the Sun license was described as a "clean-up" license. Mr. Acker pointed out that the 10Q does not include the Microsoft or Sun licenses under the OpenServer and UnixWare revenue.

Darl took issue with what he believed was Mr. Acker calling him a liar. Mr. Acker took exception and said he thought it had already been established that Mr. McBride tells the truth in the 10Qs.

Eric Acker then displayed SCO's 10Q for the quarter ending April 30, 2004 and pointed out that similarly the UnixWare revenue does not include the Microsoft and Sun license fees. And that further down in the 10Q, they can both be found under the SCOsource revenue.

Mr. Acker spent considerable time discussing revenue reporting, why those licenses would be shown in that fashion, about the tree, trunk, and branches. He asserted that UnixWare reporting is branch. Mr. McBride repeatedly circumvented answering Mr. Acker's direct question about if he'd told the investing public and SEC in 2004 the Sun and Microsoft agreements were UnixWare revenue.

Mr. Acker had Darl McBride confirm that this lawsuit was that of a slander of title causing hundreds of millions of dollars of damages. He then asked, "isn't it true that the basis of the slander of title allegation is that Novell claimed ownership of the copyrights to" the code base preexisting the APA? Mr. McBride said "yes". Mr. Acker continued with "isn't it true that Novell never claimed ownership to code after the APA?" This prompted a long story from Mr. McBride about how Novell never spoke up until right after SCO filed suit against IBM. Mr. McBride did, however, agree.

On that Mr. Acker concluded his questioning.

SCO's Mr. Singer then questioned Mr. McBride regarding the Microsoft and Sun licensing. He asked, "weren't their licenses to UnixWare and drivers?" Yes.

Regarding the eWeek article, Darl said that Sun wanted to bring Solaris to Intel, and that licensees never asked just for old software.

Mr. Singer asked about a provision that Novell would receive a portion of certain revenue (UnixWare?) if it was over a certain floor. Yes, it was never reached and never requested by Novell.

Darl related his conversations with Novell's Greg Jones. He related how the conversation was started because SCO had been going through agreements and, while they saw the majority of APA assets going to Santa Cruz, found one small item... that copyrights had been excluded. That as SCO wanted to enforce their rights, he contacted Mr. Jones to explain the oversight. Darl reported that Mr. Jones said he would "see what he could do." They discussed this back and forth (over time). Eventually, after some Novell "high ups" got involved, Novell had come back and said they weren't interested.

Darl said that at no point did Novell say SCO could not go forward with SCOsource, nor that if SCO did so that they would have to pay Novell.

Mr. Singer presented a 2004 letter from Mr. LaSala to Mr. Tibbits and asked Darl, "has Novell, as late as 2004, told SCO that their publicly available SCOsource licenses violated Novell's rights?" No, they had not.

Mr. Acker then questioned Mr. McBride about the same 2004 letter. He highlighted Novell's demand for copies of all SVRX licenses (Microsoft, Sun, and others).

Mr. Acker asked about SCO's early SCOtech program and Darl confirmed that no one took a license to the SCO libraries.

Darl confirmed that Darl did not disclose to Novell SCO's intention to enter into agreements with Microsoft or Sun. He further admitted that when Novell demanded the agreements, Darl had refused to provide them as well as many other things.

Mr. Singer then questioned Mr. McBride, but I missed recording the brief questions asked. Mr. McBride was then released.

Novell's David Melaugh made his appearance and called Greg Jones, Novell's Vice President of Technology Law. Mr. Jones stated he has a computer science and JD degree and that he's been with Novell from 2002 to present. He said he's responsible for IP licensing and R&D licensing. He said he had been present in the courtroom during Mr. Sontag's and Mr. McBride's testimony.

Mr. Melaugh asked if Mr. McBride's testimony reflected his memory of those early discussions. No, it hadn't, he said, that Darl was never that specific that they intended to license SVRX or the scope of what the SCOsource program would be. He was never very detailed. Never did SCO suggest they would open source SVRX, that they would amend or restate agreements, or enter into an agreement with Microsoft.

Mr. Melaugh showed an email dated November 21, 2002 from SCO's Chris Stone to Greg Jones. This email was never zoomed in on the screen and the details and purpose of this email were not discussed.

He next displayed the 2003 Sun Agreement and asked Mr. Jones what he did when he first received it. Greg answered that he went back and reviewed the 1994 Sun Agreement and the APA. He noted how the 2003 agreement affects confidentiality, also that it concerns a buy-out (which requires Novell agreement). He noted that SVRX is not incidental. He concluded that it should not have been entered into without Novell's approval and that the 1994 Sun agreement imposes confidentiality and sublicensing rights under strict rules and that the 2003 agreement imposes no confidentiality at all.

Mr. Melaugh asked about the result of open sourcing Solaris. Mr. Jones noted that OpenSolaris is competitive to Linux, that it is in direct competition with Novell's Linux business.

He related that he downloaded the OpenSolaris code over the Internet. He stated that it was free and did not require any agreement to be signed. He compared the downloaded source code with SVRX code and found some SVRX code included.

He displayed on the screen a side-by=side comparison of "autopush.c" from OpenSolaris and SVR4.2 and said that substantial parts are identical. Specifically highlighted were the copyright notices in the OpenSolaris code demonstrating their SVRX provenance.

Mr. Melaugh next displayed "diskusg.c". He pointed out that Sun had made some changes in 1999 but that substantial parts are the same.

Mr. Melaugh displayed another the same way. Novell then entered into evidence over a dozen more like exhibits.

When asked, Mr. Jones stated he does not know if any UnixWare code is in Solaris and clarified that he did not undertake any comprehensive search for such.

When asked about whether Novell would have agreed to the License he replied that it is not in Novell's interest to enable a competitor. He stated that Novell would not have agreed to open source SVRX.

He characterized the 2003 Sun agreement as "extraordinary", especially in the sense of taking the code from proprietary to open source.

Mr. Melaugh and Mr. Jones reviewed sections of a letter from Novell to SCO requesting information from them on the agreements.

Mr. Melaugh displayed parts of the Microsoft Agreement and Mr. Jones confirmed that it was only received through discovery in this case. Greg Jones said that when he first reviewed it, he saw numerous instances of SVRX licenses. He therefore reviewed SCO's APA. He saw that this agreement is not an amendment to an existing agreement, that it's a new SVRX agreement. Further he saw that it grants expansive rights to Microsoft.

When asked by Mr. Melaugh, Mr. Jones stated that Novell would not have entered into it, that there was no competitive advantage to enter into it.

Regarding Section 2 of the agreement, he said he finds it broadly relates to Unix and that revenue from it should all go to Novell. Section 3 is not being pursued by Novell. Section 4 provides a license grant relating to all products listed in the agreement's exhibit C, and that it grants new rights to SVRX technologies. He stated that Novell should receive all of this money.

Greg Jones stated that Novell was counting on SCO, as their fiduciary, to identify when Novell's rights were being implicated.

Next displayed was an IP Compliance License for SCO Unix Rights granted to Computer Associates. Mr. Melaugh noted the language "Unix-based code" and "Unix System V or UnixWare." Mr. Jones stated that this license is not adding UnixWare on top of pre-existing Unix rights, that it is a brand new grant.

When asked, Mr. Jones stated that Novell would not have entered into the Computer Associates agreement, that there was no business justification for Novell. And he stated Novell is entitled to all the revenue.

Mr. Jones stated the same on a number of other agreements.

SCO's Ted Normand cross examined him. Mr. Jones admitted he has not been involved in sales, marketing, or pricing software. He has however been involved in negotiations in post-APA agreements in Silicon Graphics and Cray.

Mr. Jones was questioned extensively on his knowledge of the history of Unix and Solaris and relative valuation.

Mr. Normand played a section of Mr. Jones' May 10, 2007 deposition providing his testimony of his belief of what's been transferred from Novell to SCO. The testimony when asked was his belief that trade secrets, know how, and etc. were transferred to the extent that they are not listed on the excluded assets.

Mr. Jones was questioned on his knowledge of how previous license agreements were made and whether previous software versions were included. Mr. Jones stated that his understanding was that they were included provided consideration had been received.

Mr. Normand asked whether it was Novell's purpose going into the APA to sell the entire Unix business to SCO. Greg replied that it was not the entire purpose, but significantly, yes.

Mr. Normand played a section of his deposition testimony where he said it was Novell's purpose to transition it all to SCO.

Mr. Jones was then questioned on how he understands prior product licenses and incidental licenses. Mr. Jones replied that he relies on several definitions of incidental including the definition found in the dictionary.

There was a 15-minute break which I was late returning from (as I was spending money in the court reporter's office). When I entered, Mr. Normand was questioning Greg Jones regarding terms of a Unisys agreement which I believe was executed by SCO. Mr. Jones, having been handed a paper copy of the agreement, stated that he is not familiar with the document and cannot answer to its terms. He was repeatedly asked to give his belief regarding several parts to which he said he could only repeat back that he can see what is contained on the page, but not what it means. He stated that generally lawyers need to *read* a document in order to provide answers about its meaning.

Mr. Normand dropped discussion of the specific document and asked generally whether the circumstances of an agreement have a bearing on its meaning. Mr. Jones said that the terms of the agreement are important. When pressed he answered that the circumstances have some bearing.

Mr. Normand then played a section of Mr. Jones' deposition where he states the most important part are the terms, though the entire circumstances also play a part.

An email was then presented from Greg Jones to Darl McBride dated November 15, 2002. The email mentions SCO pursuing Linux end-users for their use of Unix libraries.

Mr. Normand was unable to complete questioning on this email as they seemed to be having difficulty with the Windows XP computer used for the demonstration requiring a reboot. In the interim Judge Kimball asked if Mr. Normand could continue on a different topic. Judge Kimball opined that all he could hear from SCO's equipment was a sound like a truck backing up.

Ted Normand then questioned Greg on how Novell had source code to SVRX (to do the software comparison) if Novell had transferred it to SCO. He replied that Novell still has the repository, is fully entitled to it, and besides a contemporaneous cross-license agreement had been executed (Mr. McBride seated in front of me was nodding his head in agreement to this answer).

Mr. Normand repeatedly questioned Mr. Jones on how he comes to the judgment that in the Sun Agreement Novell gets all and values UnixWare as without value. Greg's point was that absent an apportionment rationale from SCO, Novell's position is that Novell receives it all.

There was some further discussion of what Darl had told Greg in 2002 and what responses Greg had made.

With SCO's computer back up and functioning, Mr. Normand displayed a letter from Novell to Prentice Hall where Novell's Michael DeFazio states Novell is transferring its ownership interest in all versions of Unix to SCO. Greg says that the statement is inconsistent with the terms of the APA. Mr. Jones, under questioning, stated he cannot answer why Mr. DeFazio would write that.

Mr. Normand then displays what he claims is a similar letter to Microsoft. Viewing the highlighted text displayed it was referring to "Microsoft Xenix." Mr. Normand did not ask questions on it, but instead asked to go back to the email displayed before the reboot.

In the email, SCO stated that they would be announcing a Unix licensing program for Linux.

Mr. Normand next displayed letters from Novell to Microsoft and Sun indicating Novell's belief that the 2003 agreement is unenforceable, void, etc.

Mr. Normand had no more questions, nor did Novell, and Greg Jones was released.

There was some discussion of exhibits being entered into the record. Nothing was objected to.

Novell's Michael Jacobs rested their case.

Next SCO's Mr. Singer immediately moved for dismissal. Judge Kimball noted it, and Mr. Singer called John Maciaszek as his first witness.

Mr. Maciaszek identified himself as currently semi-retired and working for SCO part-time. He joined Unix System Labs as Product Manager in 1991 and has worked there under Novell, Santa Cruz, and most recently SCO.

When asked to describe UnixWare he called it the "next release of Unix System V." He discussed SVRX versions and relationships to UnixWare versions. He described how licensing was done, that when a company licensed Unix the practice was to receive a "right to use" for all prior versions. He stated that customers would not pay extra for the right to use and (his group) had no thought to charge for it.

Mr. Singer displayed an NCR license for UnixWare source code version 2.1 and specifically directed attention to the exhibit listing prior products licensed to use. Mr. Maciaszek said that no additional fee was charged. He described it as a standard agreement. He claimed that at UnixWare 7 they stopped including a list of prior products. He said the licensee still had the right to use prior products and still didn't need to pay an additional fee. If the licensee requested it, a list of such products would be included.

Mr. Maciaszek said that UnixWare 2 included NetWare components, that NetWare was provided as binary but the licensee could pay more for a NetWare software source license. However there were additional restrictions on what they could do with it.

Mr. Maciaszek related what their "one line of code" policy was: that if an OEM had a derivative work that was built on legacy SVRX code and included even a single line of UnixWare code, then it was licensed as UnixWare.

Novell's Michael Jacobs cross-examined Mr. Maciaszek. He called his attention to the previously discussed NCR agreement and noted that it was #112. Mr. Maciaszek agreed that under standard practice NCR would have paid for each of the preceding 111 software product agreements.

Mr. Jacobs then asked whether the licensee could publish the code. Mr. Maciaszek answered "absolutely not." Mr. Jacobs questioned further if it would be a "big deal." and Mr. Maciaszek answered that it would be a violation of the software agreement.

Mr. Jacobs asked, could an OEM take the source and build their own Unix with their own name on it? He answered of course they could. Did Sun do so? Yes. Mr. Jacobs clarified that if they based their product on, say, SVR 4.2, then their product would be "frozen" to that version and build on it. Yes, he answered. And that absent a new agreement they would stay with that version? Yes.

Mr. Jacobs then asked if one were to write a letter to Sun requesting they take all the legacy SVRX code from their product, what would happen? Mr. Maciaszek answered that "it would not be favorably received." At this everyone in the courtroom laughed.

Mr. Jacobs had no more questions, and Judge Kimball held the court in recess until tomorrow.

Update 5: Of course that wasn't the end of the day's activities. The hearing on the two motions for summary judgment happened in the afternoon, and here's Chris's report on that:

The motion hearing started with Novell's Motion for Summary Judgment on its Fourth Claim for Relief. Mr. Jacobs indicated that he would need 5 minutes while SCO's Mr. Singer claimed he would need perhaps 10. In the end I don't think they took 10 minutes between them.

Mr. Jacobs said that events have overtaken the motion. He essentially just stated that Novell believes their fourth claim for relief may be decided as a matter of law. He said SCO's 2003 Sun Agreement purports to amend the 1994 agreement, that this is a question of law. He said that the 2003 Microsoft Agreement grants new SVRX rights and that this too is a question of law. He then asked that Judge Kimball rule that SCO was without authority to enter into the Sun and Microsoft agreements.

Mr. Singer had graphics for his presentation. He had four points. First he said at a minimum there is a genuine fact dispute about whether SVRX components are incidental to UnixWare. Second, he said that the 2003 Sun Agreement is not a buyout, that it overwhelmingly concerns source code rights not subject to Novell's approval. Third, there are genuine factual issues as to whether SCOsource licenses are SVRX licenses at all. And fourth, that a genuine estoppel exists in that Novell was aware from late 2002 of SCO's intentions.

Mr. Singer further elaborated on the third point that there has been no summary judgment determination that SCOsource licenses are SVRX licenses at all, that SCO has a right to release its own claims.

Mr. Jacobs responded that the APA B.5 says Novell cannot infringe SCO's rights, but that this does not expand whatever rights SCO has. That it's a circular assertion that doesn't change anything.

Next we heard SCO's Motion for Judgment on the Pleadings on Novell's Claims for Money or Claim for Declaratory Relief. As this was SCO's motion, their Mr. Ted Normand went first.

Mr. Normand went over what amounted to a decision matrix for the court. First, was SCO Novell's agent? Second, was SCO authorized? Third, if SCO was not authorized, has Novell ratified SCO's actions? Fourth, If SCO is not authorized and Novell has not ratified, do the parties get their money back? Fifth, if SCO is not authorized and Novell has not ratified, does Novell hold the money?

On the first point Mr. Normand expanded that in September of 2007, Novell wrote letters to Microsoft and Sun, which letters Novell produced only yesterday, where Novell tells Microsoft and Sun that SCO's agreement is void, unenforceable, and invalid. In support of his fourth point, Mr. Normand cited case law indicating where a contract is void or invalid the counterparty is entitled to restitution (get their money back).

On his fifth point, Mr. Normand asserted that Novell does not hold the money, that if an agent has acted without authority, they have no duty to account to the principal. He said that Novell has not ratified the agreements and that the letters from Novell to Microsoft and Sun are relevant here. He claimed that no theory permits a principal to hold money when it has not ratified.

Novell's Michael Jacobs responded. He opined that people will be talking about this case in law schools, that of all interesting cases, this is one of the more interesting ones.
He differentiates this case from other cases in that in this litigation, the third parties are not here arguing for restitution.

Mr. Jacobs advanced an example which he said more closely matches the situation. He suggested that this be likened to an employer and an employee where the employee makes an agreement he has no authority to enter into. The employee here doesn't get to keep the money. And that there would be no question of the agency relationship between the employer and employee. He said in the present case, Novell is not disclaiming the agency. He said the right thing is for Novell to hold the money, to step in between the agent and the 3rd party, and to work out with the 3rd party where to go from here.

Mr. Jacobs said that SCO has no cases that are "on all fours" for this case.

Regarding Novell's letters to Microsoft and Novell, they stated "belief"... It is Novell's "belief" that the agreements have no legal effect. The validity of the agreements have not been determined such as by a court.

Mr. Normand countered that from Novell's letters, it is clear they have repudiated the agreements. He further pointed out that principals have a requirement to act promptly upon learning about an agreement.

Judge Kimball thanked them and said he had some questions generally. He said he read in the motions that SCO advanced "unclean hands"... Mr. Singer responded they are not pursuing that.

He next asked about the constructive trust originally asked for in light of the bankruptcy. Both Mr. Normand and Mr. Jacobs agree the question of a constructive trust rests with the bankruptcy court.

Judge Kimball then mentioned a presentation he has scheduled at 2 pm Friday that conflicts with this case. He said it's just up the street, and he can make it if he leaves at 1:30. He asked if the parties would have a problem starting at 8 AM Friday instead. Both parties agree that would be no problem, but also indicated they believed they are currently making good time, and it may not be an issue anyway. It was agreed that the parties will see where they are with the case tomorrow and then decide about Friday.

Judge Kimball then adjourned the court.

I asked Chris to explain what McBride said about UnixWare and the branch to the trunk stuff as it made no sense to me. Here's the explanation:

This statement was one that was stated and restated. He's saying that while the core IP property is in the trunk, the only way anyone can get a license to use it is by purchasing a SCO UnixWare license. That is the route to the trunk is through the UnixWare branch. How this logically fits in the tree metaphor is beyond my meager imagination.

Update 6: Here's the docket entry for the motion hearing:

Minute Entry for proceedings held before Judge Dale A. Kimball: Motion Hearing held on 4/30/2008 re [478] MOTION for Summary Judgment /on Novell's Fourth Claim for Relief/ filed by Novell, Inc. and SCO's Motion for Judgment on the Pleadings. After hearing the arguments of counsel, the Court took the motions under advisement. Attorney for Plaintiff: Stuart Singer, Edward Normand, Mauricio Gonzalez; Attorney for Defendant: Michael Jacobs, Eric Acker, David Melaugh. Court Reporter: Laura Robinson. (kmj)

Wayne Richardson on ars technica also attended, and here's his account. His final word:

When SCO sent threatening letters out to Fortune 1000 companies in May of 2003, it probably didn't expect this to be the result.

No kidding. Then again, who knows? I'm waiting for the transcripts before I reach any solid conclusions. The first day arrived, but the transcripts were provided on floppies, and for some reasons they didn't work, so Chris is working the kinks out of that and we should have it by tonight, I would think. Anyway, just so you know that it's in the works, thanks to you. I can't wait. And since we received more donations than we require for these particular transcripts, if any of you intended that your donation be exclusively for that, let me know so I can reimburse you. Most of you mentioned to me already that the donation was not exclusively for this particular set of transcripts, but for whatever we need to keep Groklaw going. And I thank you. But I wish to be scrupulously careful never to take advantage of anyone's goodness, so sing out if you feel you'd like to be reimbursed.

Here's Greg Jones' Affidavit, submitted to the bankruptcy court, in which he explains how Novell views the APA.


  


Day 2 of the Novell v. SCO trial - Updated 6Xs | 527 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections Here, Please
Authored by: TheBlueSkyRanger on Wednesday, April 30 2008 @ 08:42 PM EDT
Dobre utka,
The Blue Sky Ranger

[ Reply to This | # ]

Off Topic Here, Please
Authored by: TheBlueSkyRanger on Wednesday, April 30 2008 @ 08:43 PM EDT
Dobre utka,
The Blue Sky Ranger

[ Reply to This | # ]

Newspick Discussion Here, Please
Authored by: TheBlueSkyRanger on Wednesday, April 30 2008 @ 08:44 PM EDT
Dobre utka,
The Blue Sky Ranger

[ Reply to This | # ]

transcript donations
Authored by: grouch on Wednesday, April 30 2008 @ 08:46 PM EDT
Chris is doing an excellent job, IMO, of getting details to us, but I think it would be fitting to also have the transcripts on Groklaw. The whole history of the fiaSCO should be preserved here.

I'm clicking another US $25 into the kitty. Anyone else?

---
-- grouch

"People aren't as dumb as Microsoft needs them to be."
--PJ, May 2007

[ Reply to This | # ]

The Hat
Authored by: TechnoCat on Wednesday, April 30 2008 @ 08:46 PM EDT
Maybe it's obvious to more regular posters, but which of the many
"donation" buttons leads to the transcription hat?

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial
Authored by: dcolby on Wednesday, April 30 2008 @ 08:50 PM EDT
PJ, We'll step up for the transcriptions. Contact me to let us know how to
proceed.

[ Reply to This | # ]

Pony Up, People!
Authored by: Anonymous on Wednesday, April 30 2008 @ 08:52 PM EDT
Hit the paypal link at left and send some cash to support the site if you havent
already. If you have, its time to contribute again.

I fit in the latter myself and a few bucks are already on the way. 5 Bucks from
200 of the thousand or more than will cross the site in the next two days will
cover it.

Dont wait for someone else. Its you that needs to give if you want to get the
full transcripts from the court in a timely manner.

Remember that groklaw having the full transcript has a value beyond you and me
today. Two months from now, that means we have full coverage of what happened
in this trial. Two years from now, when groklaw is still covering OOXML, that
means a law school student can reference the full transcript when researching
one of the many twists and turns in this case.


You.

Pony Up.

Today.

Paypal.

---
Clocks
"Ita erat quando hic adveni."

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial
Authored by: dcolby on Wednesday, April 30 2008 @ 08:59 PM EDT
$1000 has just been sent, via PayPal. Keep up the good work.

[ Reply to This | # ]

Nathan, Scott and Marty revisited
Authored by: Anonymous on Wednesday, April 30 2008 @ 10:01 PM EDT
Before selling Nathan's car to Marty, Scott had it repainted.
A really nice paint job. Scott claimed that the only thing of value that Marty
was buying was the artistic paint job.
The car was merely incidental - it was just the canvas for the art work.
Therefore, Nathan shouldn't be entitled to the money that Marty paid.

Tom M.

[ Reply to This | # ]

Singer moved for involuntary dismissal?
Authored by: Darigaaz on Wednesday, April 30 2008 @ 10:22 PM EDT
Does that mean what it sounds like it means, and if so, did SCO really think
that stood a chance? (Or is that normal behavior once the plaintiff rests, on
the assumption that it can't hurt to try?)

---
Many eyes make all bugs shallow - not just in software, but journalism and law
as well.

[ Reply to This | # ]

Darl
Authored by: Anonymous on Wednesday, April 30 2008 @ 10:45 PM EDT
Can wait to see Darl's weasel words .....


Lord, I apologize to all your weasels.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 2Xs
Authored by: Anonymous on Wednesday, April 30 2008 @ 11:52 PM EDT
All the boxes -- sounds like the movie "From the Hip" with Judd Nelson
(1987)

Maybe SCO is trying for the same type of shenanigans that "Stormy
Weathers" did. It isn't that the movie is that great -- but was certainly
funny and in some respects entertaining...

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 2Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 12:46 AM EDT
SCO's team was already in the room and had brought in more boxes. There was so many boxes that the stack of boxes was as high as the divider between the public area and SCO's table.

Which box is the pea under?

[ Reply to This | # ]

Entering into evidence
Authored by: Anonymous on Thursday, May 01 2008 @ 01:06 AM EDT
The second eyewitness said (today):
The issue of entering exhibits into evidence was handled better today, but when Mr. Jacobs was giving his closing remarks before resting, he did ask Judge Kimball to enter several exhibits into evidence that were present by SCO which they did not ask to be entered into evidence.
The same person (I think) said yesterday:
There was some confusion about entering exhibits into evidence. There was an agreement to waive objections to the admission of exhibits listed on Attachment A in the First Amended Joint Pretrial Stipulation. Then there was one exhibit that Mr. Jacobs felt Mr. Singer might object to, which Mr. Singer then agreed to enter into evidence. This set up an exchange between Judge Kimball asking Mr. Jacobs on almost all other exhibits if he wanted to enter it into evidence. Mr. Jacobs did not let it interrupt his presentation.
Would someone explain this? I thought the exhibits would be entered into evidence as they were used. Since Novell went first, how much of SCO's stuff would be entered by the time Novell rests? I'm particularly unsure what he/she means by "were present by SCO which they did not ask to be entered into evidence". I think there is a typo in there somewhere. Perhaps it's supposed to read "presented by SCO...", but if so, how could they be presented in a trial without being entered into evidence?

I could guess that there were some things numbered as a SCO exhibit in the Appendix A to the First Amended Joint Pretrial Stipulation that SCO didn't bring up on cross examination, but which Novell wants to make sure are entered, but if so, why weren't they a Novell exhibit? Did the questions from Judge Kimball (yesterday) happen all at once, or did a question get asked every time Mr. Jacobs pulled out a new exhibit?

Basically this all boils down to I didn't understand this. Would someone please explain?

E-man

[ Reply to This | # ]

If wishes were horses...
Authored by: Anonymous on Thursday, May 01 2008 @ 01:08 AM EDT
Darl and SCO would have won the Triple Crown! Alas, things are not so rosy as they appeared to SCO back in 2003. Thanks to whomever sent PJ the cNet article from 2003--it's Darl's greatest hits, and today it brings a smile and warmth to the heart to finally see the endgame where Darl gets to eat his words in court.

Of many great lines in the cNet article, I particularly like this passage:

Was Novell's involvement a surprise? What do you think prompted that?

What we've found here over the last couple of days is that Novell and IBM have been working together on some things relating to this case. So our suspicion is that some kind of deal they have going on with IBM is what motivated it.

Were we surprised? Yes. It's like you're sitting there fighting a battle; you have this David-and-Goliath battle going on. And then from the side, you get hit by this other force, this other army's attacking you. At first, you're surprised by it. But then you realize there appears to be some linkage to the Goliath, so then I guess it's not so surprising.

Even though we didn't have any copyright claims in our case with IBM, this shot came in. We stopped our battle with IBM for basically four days; we stamped out the Novell attack and put that one behind us. Now we're back on what our original focus was, which is resolving the issues we have with IBM.

So the whole thing with Novell was about unclear contract language?

The final problem is that Novell didn't dig to the bottom of their file drawer and find the second amendment to the contract. Once we exerted our second amendment rights, if you will, Novell basically took their ball and went home.

//

How d'ya like Novell now, Darl? Look out for that tree falling on your head!

[ Reply to This | # ]

Anything you say, can and will be used against you once you get to court.
Authored by: The Mad Hatter r on Thursday, May 01 2008 @ 01:13 AM EDT


Remember yesterday, about the tree trunk and whether UNIX and UnixWare were the same thing? Someone sent me this article from way back when, June 16, 2003, and it makes it so, so clear that this "UnixWare and System V are the same thing" story SCO started telling after August 10 is not at all w Remember yesterday, about the tree trunk and whether UNIX and UnixWare were the same thing? Someone sent me this article from way back when, June 16, 2003, and it makes it so, so clear that this "UnixWare and System V are the same thing" story SCO started telling after August 10 is not at all what they said when they believed they owned the copyrights.


All of which is a excellent illustration of why IBM has not commented publicly in other than the vaguest terms since this thing started. Anything you say, can and will be used against you once you get to court.

This sort of stuff gets management teams fired under normal circumstances, but things at TSCOG seem far from normal.

---
Wayne

http://sourceforge.net/projects/twgs-toolkit/

[ Reply to This | # ]

poison ivy on the tree
Authored by: grouch on Thursday, May 01 2008 @ 04:04 AM EDT

[Darl said:]

We think of this as a tree. We have the tree trunk, with Unix System 5 running right down the middle of the trunk. That is our core ownership position on Unix.

Why do so many try to put poison ivy all over the old tree?

The hackers who created Unix didn't make it dangerous to touch -- that came later, from the suits. It took the fight by the BSD Regents to keep their part of the tree from being locked away, else it would have withered and died. It took Stallman's GNU to create and protect a new tree from those who think it's just another shrink-wrap product. It took Torvald's Linux, under the GPL, to put enough vitality in the new tree that even the suits had to notice. Alas, there are still greedy ones who think the old tree can survive under lock, key and shrouds of poison ivy.

Software is not a manufactured widget. It's either 'living' -- adapting, growing, repairing -- or it dies. Closing it off to charge tolls just ensures that it will never thrive as well as software which encourages users' freedoms.

The old tree thrived in its early days, when patches, programs and tapes were flying from hacker to hacker, university to business. The greedy ones didn't understand its roots and tried to warp it into expensive, exclusive bonsai. Some parts are already rotted and withered. The new shoots make certain that the line isn't lost.

May SCOG's last gasp signal the end of attempts to transfer to the new tree the poison ivy that stifles the old one.

---
-- grouch

"People aren't as dumb as Microsoft needs them to be."
--PJ, May 2007

[ Reply to This | # ]

Nice cnet quote
Authored by: GLJason on Thursday, May 01 2008 @ 04:36 AM EDT
Q: How did the Linux action originate? How and when did you come to realize there was this problem?

A: It really goes back to last fall. I joined the company last summer, and we spent a quarter or two looking at this Unix operating system asset we have.

SCO ends up owning the intellectual-property rights to the Unix operating system, which is a pretty substantial asset to be holding. So we started looking closely at where Unix was relative to Linux. Linux was starting to take off, and we did have some concerns.

Companies don't usually lose money for years and suddenly find some IP they had hidden that is supposedly worth billions.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: DeepBlue on Thursday, May 01 2008 @ 05:05 AM EDT
Excellent stuff!!

When do we get the transcripts of day 1? Do they need scanned in or something?

---
All that matters is whether they can show ownership, they haven't and they
can't, or whether they can show substantial similarity, they haven't and they
can't.

[ Reply to This | # ]

Salt Lake Tribune article about day 2
Authored by: tangodelta on Thursday, May 01 2008 @ 05:12 AM EDT
clicky

[ Reply to This | # ]

If Darl doesn't like being called a liar
Authored by: Anonymous on Thursday, May 01 2008 @ 05:57 AM EDT
...perhaps he should stop lying.

Still, with a bit of luck, it won't be long before being called a liar is the
least of
his worries. "Convicted felon" has a much nicer ring to it, after all

[ Reply to This | # ]

Report from The Salt Lake Journal
Authored by: Chris Lingard on Thursday, May 01 2008 @ 06:02 AM EDT

The article can be found here

The reporter tried to get comments from Microsoft and Sun regarding the license. Novell has written to both these companies pointing out that their licenses are not valid.

Novell presented letters it sent last year to Microsoft and Sun in which Novell said it did not believe that licensing agreements between those companies and The SCO Group were valid. As a result, the letters said, the two companies could be "exposed" to claims by Novell.

The letters were brought up during a hearing in which U.S. District Judge Dale Kimball was considering motions by the two software companies, including one in which SCO asked him to rule that it does not owe Novell fees that SCO collected for licensing the Unix operating system to Microsoft, Sun and others.

[ Reply to This | # ]

Danger! Novell could take over from SCO
Authored by: Anonymous on Thursday, May 01 2008 @ 06:18 AM EDT

When asked about whether Novell would have agreed to the License he replied that it is not in Novell's interest to enable a competitor. He stated that Novell would not have agreed to open source SVRX.

I wonder whether Novell will start claiming that "their" SVRX code/concepts/methods are in Linux.

I expect that if they did, they would have no more success than SCO's notorious "MIT deep divers", but they could afford to fund a FUD lawsuit longer than SCO.

[ Reply to This | # ]

SEC or Trustee in the gallery?
Authored by: Anonymous on Thursday, May 01 2008 @ 06:31 AM EDT

Given that Darl is making statements contrary to various SEC filings signed off by him and the board... is it likely that there's an official from the SEC there, or perhaps from the Trustee's office studiously observing?

Charles from Oz

[ Reply to This | # ]

No Objection to Hearsay?
Authored by: Anonymous on Thursday, May 01 2008 @ 06:38 AM EDT
This stuck out, from Chris' report:

"Mr. Acker then discussed the Microsoft agreement, and Chris Sontag stated
that they were only interested in latest SCO products. Mr. Sontag further stated
that he is not aware of Microsoft including any SVRX, OpenServer, or UnixWare
code in any of their products.

Sontag can't testify as to what MS interests were.

[ Reply to This | # ]

When I buy UNIXWARE do I get source too?
Authored by: Anonymous on Thursday, May 01 2008 @ 06:55 AM EDT
I was under the impression that UNIXWARE was a compiled and packaged operating
system to be installed and run on a computer.

Whereas when speaking of a SVRX licensee, they would get source code for the
purposes of compiling their own version of UNIX from source.

Now SCO is delivering UNIXWARE with source? or have they always done so?

[ Reply to This | # ]

The only way to the trunk is through the UnixWare branch
Authored by: Anonymous on Thursday, May 01 2008 @ 07:15 AM EDT
This statement was one that was stated and restated. He's saying that while the core IP property is in the trunk, the only way anyone can get a license to use it is by purchasing a SCO UnixWare license. That is the route to the trunk is through the UnixWare branch. How this logically fits in the tree metaphor is beyond my meager imagination.
This sounds like SCO is admitting that SVRx cannot be "incidental" when licensing UnixWare source code.

I am also surprised that Novell didn't redirect to Mr. Maciaszek about the "one line of code" policy. He seems to be saying that a single line of UnixWare code makes UnixWare non-trivial and non-incidental to any piece of source code. I would have drilled him about whether he though that a file that was 99.9% pre-APA SVRx code that had a single line of UnixWare code in it made the SVRx code "incidental" to the UnixWare license.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 07:21 AM EDT
This jumped out:

"On his fifth point, Mr. Normand asserted that Novell does not hold the
money, that
-> if an agent has acted without authority, they have no duty to account to
the principal. <--
He said that Novell has not ratified the agreements and that the letters from
Novell to Microsoft and Sun are relevant here. He claimed that no theory permits
a principal to hold money when it has not ratified."

What sophistry! Now, if an agent acts entirely outside the scope covered by the
agency relationship, regarding acts covering matters not included at all under
the agency relationship - then of course they don't have 'authority' in that
case because there is no agency relationship at all - and then what Normand is
saying is "true", nominally, but he is merely stating a tautology.
But where the unauthorized agent conduct IS about the scope of the agency, and
the agent acts wrongfully, without authority, i.e., steals the money - then OF
COURSE the agent has a duty to account to the principal, they have violated that
duty, they have committed conversion/theft, fiduciary breach, etc.

I hope Judge Kimball jumps on that argument in his decision.

LEXLAW

[ Reply to This | # ]

Specifity - Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 07:57 AM EDT
autopush.c

Novell knows how to be specific! Plus a dozen other examples. Sounds like
Novell is hammering nails!

[ Reply to This | # ]

"you'd have to ask the engineers."
Authored by: tiger99 on Thursday, May 01 2008 @ 08:08 AM EDT
Darl's biggest mistake was not doing that first.

They could have told him that there was no illegal copying of any version of Unix code into Linux, for a start, so no IBM case. I guess that Novell would still have happened, but it might just have been a simple case of enforcing payment.

[ Reply to This | # ]

Message for Darl.
Authored by: Anonymous on Thursday, May 01 2008 @ 08:09 AM EDT
The world and its dog is laughing at you.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 08:24 AM EDT
First of all thanks to those who reported on the proceedings, especially Chris.
Regarding the business about access to the trunk and Unixware

"This statement was one that was stated and restated. He's saying that
while the core IP property is in the trunk, the only way anyone can get a
license to use it is by purchasing a SCO UnixWare license. That is the route to
the trunk is through the UnixWare branch. How this logically fits in the tree
metaphor is beyond my meager imagination."

I believe Darl is claiming that Unixware acts like a key to the underlying SVRX
code. Because it is only possible (per his assertion) to access SVRX code
through a Unixware licence, the Unixware "branch" is the significant
part and SVRX is simply an incidental vestige. As an argument this is like
suggesting that the door to a bank is the really important part and not the
money inside : when did you last hear of anyone stealing the door ? And it
doesn't fit well with the tree analogy because the tree analogy came before Darl
needed to convince everyone that these were really licenses for Unixware.

The bit of the report that made me smile was when SCO's AV machine wouldn't
work

"Judge Kimball opined that all he could hear from SCO's equipment was a
sound like a truck backing up."

I think the sound was SCO trying to back out of this lawsuit.

-------------------
Nigel Whitley

[ Reply to This | # ]

HaHaHaHaHa.
Authored by: Anonymous on Thursday, May 01 2008 @ 08:41 AM EDT
"Maintain an accurate and up-to-date resume in case I ever need one"

Just for the record.

[ Reply to This | # ]

Rubber Hits the Road - Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 08:44 AM EDT
"He next asked about the constructive trust originally asked for in light
of the bankruptcy. Both Mr. Normand and Mr. Jacobs agree the question of a
constructive trust rests with the bankruptcy court."

Two more days.

The longer Judge Kimball takes to reach his decision, the more SCO will spend.

[ Reply to This | # ]

Favorites
Authored by: Anonymous on Thursday, May 01 2008 @ 10:05 AM EDT

I'm not done reading yet but the following gave me a laugh:

    Darl took issue with what he believed was Mr. Acker calling him a liar. Mr. Acker took exception and said he thought it had already been established that Mr. McBride tells the truth in the 10Qs.
Mr. McBride... there's an old saying: if the shoe fits, wear it. In case you're not too sure what that says, if someone points out two of your statements as being contradictory then perhaps they are.

RAS

[ Reply to This | # ]

Nice Job, Chris
Authored by: lnuss on Thursday, May 01 2008 @ 10:07 AM EDT
First I want to say thanks to Chris for the excellent job of reporting, not only
for this trial, but for so many of the other hearings in the past. His reporting
just keeps getting better and better.

Great job Chris- Thanks!

---

Larry N.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 10:09 AM EDT
Everyone is being very polite and all, but
isn't it delicious to find Darl on the stand
under oath forced to note his lies about
scosource licenses?

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: Anonymous on Thursday, May 01 2008 @ 10:58 AM EDT
One of the highlights for me was SCO's cross of Greg Jones. Jones established
that Sun had open sourced code owned by Novell. SCO's response was to ask
questions about the intent of the APA. But Judge Kimball has already ruled that
the copyrights to the code in question were not transfered. Since that issue
has already been decided, Mr. Normand might just as well have stood up and said,
"We've got nothing!".

Bad tree analogies aside, the really interesting arguement from SCO is the bit
about Novell not being entitled to the money because they didn't ratify. I
can't wait to see what Kimball does with that!

[ Reply to This | # ]

scog make my head hurt
Authored by: sumzero on Thursday, May 01 2008 @ 11:06 AM EDT
they say:

novell failed to act in a timely manner, but gloss over the fact that novell
couldn't act without sufficient information which was not forthcoming from
scog.

novell never told ius not to do this, but scog never clearly identified what
they were planning to do.

and on...

more of the same from scog: everything is presented out of context, includes a
great deal of hearsay, and is not internally consistent.

sum.zero

---
48. The best book on programming for the layman is "alice in wonderland"; but
that's because it's the best book on anything for the layman.

alan j perlis

[ Reply to This | # ]

Concealed Principal.
Authored by: Ian Al on Thursday, May 01 2008 @ 11:18 AM EDT
Anyway, as I told you all along, SCOG continue to claim that they weren't acting under the agency agreement and that they are completely free to do SCOSource business without Novell's say-so.

Darl claimed that while SCO was a fiduciary of Novell's, it was not in respect to these licenses, that Novell had no standing to demand these licenses.
However, Novell points out that

SCO's 2003 Sun Agreement purports to amend the 1994 agreement, that this is a question of law. He said that the 2003 Microsoft Agreement grants new SVRX rights and that this too is a question of law. He then asked that Judge Kimball rule that SCO was without authority to enter into the Sun and Microsoft agreements.
SCOG said
First, was SCO Novell's agent? Second, was SCO authorized? Third, if SCO was not authorized, has Novell ratified SCO's actions? Fourth, If SCO is not authorized and Novell has not ratified, do the parties get their money back? Fifth, if SCO is not authorized and Novell has not ratified, does Novell hold the money?
It seems to me that SCOG maintained in court and to the various SCOSource victims that they were not working as an agent. However, the contracts are shown by Novell to be within the scope of the agency agreement and that SCOG violated the agency terms.

My question is, if SCOG let contracts that were proper for consideration under the agency agreement, but SCOG claimed they weren't, will the court consider their position as one of rogue agents or as simple violators of another company's copyrights and trade secrets?

If Novell are right about them being within the scope of the agency agreement and what someone in an earlier thread said about the rights and responsibilities of concealed principals to an agency agreement is also on the money, I would have expected the judge to ignore the issue of general violation of Novell's rights by a third party and concentrate on SCOG's violation of the agency agreement regardless of SCOG's protestations that the agency agreement was not relevant.

Just in passing, I also expect the judge to have a dim view of Singer's assertions.

First he said at a minimum there is a genuine fact dispute about whether SVRX components are incidental to UnixWare. Second, he said that the 2003 Sun Agreement is not a buyout, that it overwhelmingly concerns source code rights not subject to Novell's approval. Third, there are genuine factual issues as to whether SCOsource licenses are SVRX licenses at all. And fourth, that a genuine estoppel exists in that Novell was aware from late 2002 of SCO's intentions.
His first point is irrelevant. The judge found that SCOSource was SVRX licences. The handwaving about Unixware does not address their responsibilities over SVRX contracts. His second point is unargued. He said that the 2003 Sun Agreement is not a buyout, that it overwhelmingly concerns source code rights not subject to Novell's approval. However
Greg [Jones] answered that he went back and reviewed the 1994 Sun Agreement and the APA. He noted how the 2003 agreement affects confidentiality, also that it concerns a buy-out (which requires Novell agreement).
Nowhere is there argument offered on SCOG's side that this was not true. However, his third point takes the biscuit.
Third, there are genuine factual issues as to whether SCOsource licenses are SVRX licenses at all.
On 10th August he was told by Judge Kimball that as a matter of law they were SVRX licences and that there was no factual dispute otherwise he would not have made the summary judgement. At a later date he warned Singer not to retry the issues already settled by summary judgement. I expect him to make that point again with much more force. The fourth point that there was genuine estoppel of Novell because SCOG had told them what they intended and Novell did not attempt to stop them is laughable. Novell said they wanted nothing to do with SCOG's plans. When they suspected that the agency terms had been violated they 'carpet bombed' SCOG with demands to see the contracts. Darl said no. He repeated it in court, today. The accusation of estoppel by inaction is fully countered by Darl's testimony.

---
Regards
Ian Al

When nothing else makes sense, use Linux.

[ Reply to This | # ]

More Delicious Irony Tablets
Authored by: DaveJakeman on Thursday, May 01 2008 @ 11:57 AM EDT
He related that he downloaded the OpenSolaris code over the Internet. He stated that it was free and did not require any agreement to be signed. He compared the downloaded source code with SVRX code and found some SVRX code included.

He displayed on the screen a side-by-side comparison of "autopush.c" from OpenSolaris and SVR4.2 and said that substantial parts are identical. Specifically highlighted were the copyright notices in the OpenSolaris code demonstrating their SVRX provenance.

As we have learned over and over, SCO protest loudest and most bitterly about those misdeeds they have themselves committed. But this one takes the biscuit.

---
Monopolistic Ignominious Corporation Requiring Office $tandard Only For Themselves

[ Reply to This | # ]

Arstechnica - "Deluded SCO CEO on witness stand"
Authored by: Brian S. on Thursday, May 01 2008 @ 11:59 AM EDT

“Linux is a copy of UNIX”

I entered the courtroom yesterday at 8:30 AM, a few minutes after the proceedings were scheduled to begin. SCO senior vice president Chris Sontag was already on the stand, being questioned by Novell. When asked, "Is there any UnixWare code in Linux?" the answer was, "There very well could be, [...] I've never done that analysis, never seen that analysis."...

After Sontag was dismissed, Novell called SCO CEO Darl McBride to the stand... Arstechnica

[ Reply to This | # ]

John Terpstra
Authored by: mossc on Thursday, May 01 2008 @ 12:41 PM EDT
"Mr. McBride testified that when he was hired in 2002, SCO was not
profitable. He asked his top managers what they would do if they ran the
company. One manager, John Terpstra, said he believed Unix was in Linux, that
most of the company's efforts up to this time had been in Linux, but that most
of the income was from Unix."

Having met John Terpstra after the IBM case began I would be interested in
seeing his deposition. I think one was taken for the TSG vs IBM case. I would
not be surprised if his characterization differs for Mr McBride's. John
Terpstra is/was very involved in the Samba project. I have two books on my
shelf with his name on them "The official Samba-3" and "Samba-3
by example". I would be surprised to hear "he believed Unix was in
Linux".

Why would they need to rely on someone "believing" this anyway? If I
was a CEO of a company and a manager told me someone was infringing
"my" copyrights and the code was available to compare..... I would
ask them to show me examples and then deal with the issue. John Terpstra is
technically competent enough that if he believed UNIX code was in Linux he would
have some basis for this belief and would be able to find examples.

[ Reply to This | # ]

New WAG
Authored by: Anonymous on Thursday, May 01 2008 @ 02:17 PM EDT
How many days until Darl resigns?

[ Reply to This | # ]

Sun Open Sources SVRX via Solaris
Authored by: Anonymous on Thursday, May 01 2008 @ 02:26 PM EDT
I think the real news is that SUN has open sourced Solaris,
and hence SVRX after buying a contract that NOVELL will
claim is invalid. Will that be cancelled if the contract
from SCO is voided by NOVELL??

Second, in contrast to the 'open source is good' mantra,
NOVELL would have liked to stop that because it would
compete with its Linux business. I think this is perfectly
reasonable for NOVELL, why help a competitor?

[ Reply to This | # ]

SRVX Incidental?!?
Authored by: Anonymous on Thursday, May 01 2008 @ 03:12 PM EDT
"Mr. Singer had graphics for his presentation. He had four points. First he
said at a minimum there is a genuine fact dispute about whether SVRX components
are incidental to UnixWare."

I can't believe they keep harping on that. Were it not for SRVX, Unixware would
not exist. Take away everything SRVX from Unixware, and Unixware would be
useless. Certainly they don't believe that Kimball is that deaf, blind, and
dumb after all this time to not see that.

[ Reply to This | # ]

two interesting points related to the IBM trial
Authored by: mossc on Thursday, May 01 2008 @ 03:14 PM EDT
1. if SVRX is so worthless/incidental how does it justify the 1 billion dollar
lawsuit (+4 Billion later) against IBM?

2. There could be no remaining confidential SysV in what Sun released. One of
their ongoing causes of action in IBM was releasing that IBM was required to
keep source code confidential unless it otherwise became public knowledge. TSG
itself contractually allowed Sun to release all of SysV as open source. (at a
cost of 11 million? how did they calculate the initial 1 billion of damages?)

[ Reply to This | # ]

Sorry for the long quote. But this is a gem:
Authored by: Anonymous on Thursday, May 01 2008 @ 03:22 PM EDT
"Showing the letter Mr. McBride sent to Fortune 1000 companies, Mr. Acker
asked about Unix System V source code having been copied into Linux. There was a
back and forth exchange about if the letter directs the recipients to get a
license from SCO, with Darl denying the letter does so. It does put the
recipients on notice, but doesn't tell them to get a SCOsource license, he
maintained.

Mr. Acker highlighted the example in the letter of SCO having initiated legal
action against IBM, but Darl claimed the letter doesn't say SCO will sue
them."

So Mr McBride, the letters shown were only the black-and-white and nothing not
written in specifically is to be inferred? So please tell me where there is
anything in this <shows the APA and ammendments> that in black and white
say you can do what you have done, have gained what you maintain you have
gained? Or is it only when you are being called to task that the black-and-white
is all that should be taken? Isn't that called hypocrisy? Is that what you've
caused the waste of time on the courts' time and all the solicitors here
(solicitors which include members of your family, who get paid by the hour...)?

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 5Xs
Authored by: wharris on Thursday, May 01 2008 @ 04:02 PM EDT
As a long-time reader and occasional contributor, I'm glad to pitch in. Since
the
transcripts are more than covered I guess my $50 can go toward champagne.

[ Reply to This | # ]

Novell wouldn't open-source SVRX
Authored by: Anonymous on Thursday, May 01 2008 @ 04:22 PM EDT
So Novell wouldn't have let Sun open-source Solaris? Remind me, who are the
good guys here?

[ Reply to This | # ]

SCOXQ.PK admitting
Authored by: kh on Thursday, May 01 2008 @ 05:07 PM EDT
If SCOXQ.PK admits that Novell has the power to reject the MS and Sun agreements
then surely it is admitting that they were acting as an agent for Novell
"IP".

[ Reply to This | # ]

SCO Defence - The $40 block of Ice.
Authored by: Anonymous on Thursday, May 01 2008 @ 05:07 PM EDT
Ever seen the signs at liquor stores?

"Free slab of Beers with each $40 bag of Ice"

That is effectively SCO's defence.

[ Reply to This | # ]

  • Exactly - Authored by: Anonymous on Thursday, May 01 2008 @ 06:32 PM EDT
Call me a conspiracy theorist
Authored by: Anonymous on Thursday, May 01 2008 @ 05:16 PM EDT
It sounds almost like BigCo paid SCO to file this lawsuite, and paid Sun to open
source Unix to try to destroy Unix, a still compettitor to BigCo, and possibly
to kill Novell. If so, (and if it succeeds) it is only a matter of time until
BigCo kills Sun (or tries to).

[ Reply to This | # ]

Darl took the stand today...
Authored by: Anonymous on Thursday, May 01 2008 @ 05:16 PM EDT
Did he roll marbles and talk about strawberries ?

[ Reply to This | # ]

grants expansive rights to Microsoft
Authored by: SpaceLifeForm on Thursday, May 01 2008 @ 05:18 PM EDT
This is why Novell should *NOT* ratify the "license".

Something smells real fishy.


---

You are being MICROattacked, from various angles, in a SOFT manner.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 6Xs
Authored by: JamesK on Thursday, May 01 2008 @ 06:11 PM EDT
"Judge Kimball opined that all he could hear from SCO's equipment was a
sound like a truck backing up."

The backup software probably kicked in. ;-)


---
If it's green and in my fridge, it's been there too long.

[ Reply to This | # ]

SCO Deep Sixes Their Own Case Against IBM?
Authored by: sproggit on Thursday, May 01 2008 @ 06:21 PM EDT
Hey everyone, there's something else in today's hearings that stands out as odd. Scroll to the beginning of "Update 4" in the transcript, above, and you'll find this paragraph:

"Today's trial continued with Chris Sontag still on the stand with Novell's Eric Acker conducting redirect. Mr. Acker asked Mr. Sontag if he's aware of any code unique to UnixWare that is in Linux (that is, code not present in SVR4.2 for example). Chris responded, circuitously, that he is not aware of such."

Now, we all know that IBM licensed the original AT&T Code from way back when, and not any version of Unixware, right? We also know from the August 10, 2007 Memorandum and Order that Judge Kimball has ruled that the copyrights to the Novell code remains with Novell. SCO own the copyrights only to those changes and enhancements that they made to the original code base.

But here we have Chris Sontag saying that there is no Unixware code in Linux. So like, Duh, Chris... Doesn't that mean you've just admitted that even if IBM has copied "UNIX" Code into Linux, that you [SCO] have never owned it anyway...

It's going to be very interesting to see if this interpretation (and hey, IANAL, so who knows?) is close to accurate and, if so, will be picked up by IBM.

I just can't help but think that this question was planted by IBM and that Sontag's answer is going to come back to haunt SCO in the event that the case against IBM ever sees the light of day.

We have to prefix that statement with "if", because in the terms of the hole that SCO are presently digging for themselves, it's beginning to look as though they are using the remaining converted funds to purchase mechanical diggers for their executives to use...

[ Reply to This | # ]

The Long Run
Authored by: bezz on Thursday, May 01 2008 @ 08:01 PM EDT
Now that Novell is laying its cards on the table in court, I can see where they
are heading n the Long Run. I look at the dollars and cents; groklaw has plenty
of commentators who are much better versed in law and the history of the code
involved.

Novell has known all along it would not get any significant financial recovery
out of SCO. Now that they are in court, some of the important items they are
pursuing include: Did SCO exceed its authority? What authority did SCO grant
to Sun in contradiction to Novell's wishes? Was Sun aware Novell has issues
with the SCOSource license? What did Sun do with the authority it ostensibly
got from SCO? Does Solaris contain SVRX code covered under previous licenses
issued by Novell and what were the terms of those licenses?

We know the answers. Sun wanted to release OpenSolaris source code under the
CDDL, which is incompatible with the GPL. OpenSolaris -- especially on x86 --
is a competitor to Linux. Finally, OpenSolaris is built, to some degree, on
code to which Novell owns the copyrights.

Now that Sun has released the source code, Novell's copyrights are impaired. To
what degree depends upon how much of that original 1994 SVRX code is retained in
Solaris. That could be substantial, because it is foundation and quite old, so
how much would Sun have removed and replaced over the years? I suspect little
and the value in Solaris is built on top of the originally-licensed code.

But that does not mean the cost to Novell is trivial. Novell paid $300 million
for the USL code base in 1993. What rights it later sold to Old SCO were worth
$50 million (Old SCO stock).

That, however, does not mean what rights Novell currently owns are worth $250
million. For one thing, I am not clear on the values of UnixWare in the deal.
Also, I have only read the latest Novell 10-K and it does not break out the
goodwill adequately to determine if any of it is related to UNIX assets. Oh
well, looks like I need to go through every 10-K back to 1993 to determine if
any value is goodwill.

One thing seems clear: Novell is going to go after Sun when this is all over,
and if Kimball rules in their favor on the authority issue, Sun won't ever want
to see the inside of a court room. Will they say the copyright assets were
worth on the order of $250 million? Only some research can get close to a guess
at a figure. But they are going to go after Sun and want Kimball to allow them
to determine how.

Unless SCO has some very convincing answers to undo the damage Novell did over
the last two days (and they won't), we now know that Novell may have a huge
payout due from Sun.

Who knows what they have in store for Microsoft (the reports didn't indicate any
plans), but if it involves turning over source code in discovery, you can bet
Microsoft will rush to make a deal with Novell, too.

[ Reply to This | # ]

Day 2 of the Novell v. SCO trial - Updated 6Xs
Authored by: kutulu on Thursday, May 01 2008 @ 08:51 PM EDT

For those who are curious, I found what I assume is the quote referenced in the Ars article. It's worded differently from what article says, though barely:

11 It’s the same thing. It’s the same book. It’s the same
12 thing. Linux is a replica of our UNIX, period.

[ Reply to This | # ]

Code snafu
Authored by: Anonymous on Friday, May 02 2008 @ 09:11 AM EDT
I am a novice C programmer. I found a kind of funny coding mistake in the first
source file I saw in the article:

diskusg.c

The code in question with the mistake is here:
=====

register char *str;
{
char *skip();

for( ; *str && igncnt < MAXIGN; str = skip(str), igncnt++)

=====

In the FOR loop, there is a semi-colon right at the beginning of the statement.
The result, none of the code within the parentheses will execute. Just found it
kind of funny as, when I was first learning, I made similar mistakes
occasionally that caused a for loop to not execute at all or similar things.

[ Reply to This | # ]

  • Code snafu - Authored by: Anonymous on Friday, May 02 2008 @ 09:52 AM EDT
  • No code snafu - Authored by: Anonymous on Friday, May 02 2008 @ 09:55 AM EDT
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