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Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Monday, October 19 2009 @ 12:01 PM EDT

The SEC has some news in SCO's latest 8K:
Item 5.02 Departure of Directors or Certain Officers

On October 14, 2009, The SCO Group, Inc., (“SCO”, “us”, “we”or the “Company”) announced that the Company has eliminated the Chief Executive Officer and President positions and consequently terminated Darl McBride. The current management team comprised of Chief Operating Officer, Jeff Hunsaker, Chief Financial Officer, Ken Nielsen and General Counsel, Ryan Tibbitts, along with the rest of the management team will continue to work closely with the Chapter 11 Trustee and his advisors.

Item 8.01 Other Material Events

SCO also announced a restructuring plan following an analysis of the company's operations and cost structure undertaken by Chapter 11 Trustee, Edward Cahn and his advisors. The Company is also looking to raise additional funding and sell non-core assets to bolster working capital.

I wonder how the Chapter 11 Trustee defines "non-core"? Other than Darl, I mean.

ars technica says the litigation will continue:
In a statement issued by SCO's new leadership, the company indicates that it plans to continue its litigation efforts and will move forward with the appeals process. The company also says that it plans to continue supporting its UNIX products. This potentially indicates that SCO has given up on trying to unload its UnixWare assets, a plan that has fallen through several times now as various proposed deals have evaporated.

"These actions, while difficult, are essential to SCO becoming a more agile and efficient company, not just for this year, but for years to come," said Hunsaker in a statement. "This restructuring plan reinforces SCO's ability to continue to sell and support its products while servicing the needs of our customers and partners on a worldwide basis through the stabilization of our financial situation."

Sad when getting rid of you is deemed essential for a company's survival. But I doubt this is the end of the Cowboy. He has reportedly said that there could be a shareholder revolt and litigation against the Chapter 11 Trustee. And none of the above tells us what the folks who have backed SCO from day one will do. If you recall, in the Pelican Equity complaint, other defendants with McBride allegedly called him their puppet. So... who is the puppet master?

There is another allegation in footnote 2 on page 12 of the First Amended Complaint [PDF]:

2 McBride met Norris while he was working for AIP. The conclusion of the venture to take control of SCO Group bore similarities to that of the stock loan business. Norris, McBride, and Brazell took the opportunity for themselves to the exclusion of Robbins. After Norris and Robbins established a joint venture to purchase SCO out of bankruptcy with McBride's assistance, Norris and Brazell excluded Robbins' company from that entity and replaced it with Brazell's company, Gulf Capital Partners, LLC. Not coincidentally, Bryan Cave also represented Gulf Capital Partners. In connection with that endeavor, McBride unlawfully made a $100,000 payment to Norris, which he obtained through a home equity loan that he bragged was fraudulent, to make up for fees that the bankruptcy judge had forbidden SCO to pay Norris.
Now, this is an allegation, not evidence. You can say whatever you want in a complaint, and it's only later in litigation that you find out who is telling the truth or who is in the right. Both McBride and Bryan Cave have filed motions to dismiss the complaint, which are pending. But while it's important to caution about not jumping to conclusions, the fact that such incendiary allegations are out there now in public could be at least part of what may be happening behind the scenes, I would imagine.

I find it hard, I guess, to understand the reasoning behind firing McBride and then continuing the litigation unless there is some other factor. Litigation is his best skill, in my view. But then, SCO never did take my advice. Think how much trouble they could have saved themselves, and the rest of us, if they only had.

P.S. SCO's litigation will eventually fail, in my view, because of the GPL. They released their Linux products under the GPL. It's the fundamental flaw that will sink that ship no matter what else they are able to do. I've been saying that since Groklaw began, and it's still my opinion.

Here's the SCO statement in full, attached to the 8K as Exhibit 99-1:

THE SCO GROUP ANNOUNCES STRATEGIC PLAN AND MANAGEMENT CHANGE

Lindon, Utah, October 16, 2009 – The SCO Group, Inc., (Pink Sheets: SCOXQ) a leading provider of UNIX® software technology, today announced a restructuring plan following an analysis of the company's operations and cost structure undertaken by Chapter 11 Trustee, Edward Cahn and his advisors.

The company expects to finalize details of the restructuring and to reach cash flow breakeven for core operations within the next month. The savings are a combination of non-workforce related changes and a modest reduction in SCO’s workforce. As part of the restructuring, the company has eliminated the Chief Executive Officer and President positions and consequently terminated Darl McBride. The current management team comprised of Chief Operating Officer, Jeff Hunsaker, Chief Financial Officer, Ken Nielsen and General Counsel, Ryan Tibbitts, will continue to work closely with the Chapter 11 Trustee and his advisors to implement the restructuring plan, move the intellectual property litigation forward with Boies, Schiller & Flexner, LLP and emerge from Chapter 11 bankruptcy.

The company is also looking to raise additional funding and sell non-core assets to bolster working capital. These actions will allow the Trustee to preserve cash and the value of the business while enabling the Company to proceed with asset sales, pursue litigation against, among others, IBM and Novell, and to continue supporting SCO’s loyal UNIX customer base.

“These actions, while difficult, are essential to SCO becoming a more agile and efficient company, not just for this year, but for years to come,” said Mr. Hunsaker. “This restructuring plan reinforces SCO’s ability to continue to sell and support its products while servicing the needs of our customers and partners on a worldwide basis through the stabilization of our financial situation.”

Forward Looking Statements

The statements contained in this press release regarding (1) the Company’s plan of reorganization and (2) the Company’s financing efforts are forward-looking statements and are made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to risks and uncertainties. We wish to advise readers that a number of important factors could cause actual results to differ materially from historical results or those anticipated in such forward-looking statements. These factors include, but are not limited to, outcomes and developments of our restructuring plan,outcomes and developments of our Chapter 11 case, court rulings in our bankruptcy proceedings, the impact of the bankruptcy proceedings on our other pending litigation, and our cash balances and available cash. These and other factors that could cause actual results to differ materially from those anticipated are discussed in more detail in the Company’s periodic and current filings with the Securities and Exchange Commission, including the Company’s Form 10-K for the fiscal year ended October 31, 2008, as amended, and future filings with the SEC. These forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update such statements to reflect events or circumstances arising after such date.

I gather the Chapter 11 Trustee thinks there is a way to keep the company in business. And he also thinks, so far, that the litigation is worth pursuing. Or he'd like IBM to think so. I see he is looking for money, and SCO has always had the fantasy that at some point IBM would pay them to go away. But then, he's new. Perhaps, more rationally, he just hopes to attract investors who might be more attracted if McBride wasn't part of the investment. And firing McBride indicates to me that while the litigation will continue, it won't be pursued in the same manner as under McBride's leadership. What about SCOsource? That, according to Heise, is what caused SCO's financial troubles in the first place. An English translation by computer:
Under the direction of McBride ensured the company with an aggressive Unix campaign for attention, which culminated in the unjustified demand that all companies, which use Linux would have to buy intellectual protection licenses of SCO. This campaign was accompanied by a high-altitude flight of the SCO share.
I love that. High-altitude flight. Like Icarus. Too bad the SEC wasn't wire tapping back then. Here it is in German:
Unter der Leitung von McBride sorgte die Firma mit einer aggressiven Unix-Kampagne für Aufsehen, die in dem Ansinnen gipfelte, dass alle Firmen, die Linux einsetzen, intellektuelle Schutz-Lizenzen von der SCO kaufen müssten. Diese Kampagne wurde von einem Höhenflug der SCO-Aktie begleitet.
Update: Heise has done its own English translation now:
Under McBride's stewardship, the company made headlines for its aggressive UNIX campaign which culminated in the demand that every company using Linux should purchase an IP license from SCO. The campaign was accompanied by a soaring SCO share price. The boom was short-lived. SCO shares are now worth one penny, and the company has been forced to file for protection from its creditors under Chapter 11 of US insolvency legislation. In a hearing before the bankruptcy court McBride recently claimed that he was in negotiations with four potential purchasers over the future of the SCO Group.
Steven J. Vaughan-Nichols realizes that this is not The End:
Does this mean that we can finally make funeral arrangements for SCO? I wish!

But I do think this means that SCO's anti-Linux lawsuits are dead. Yet the question of who actually owns Unix's intellectual property — SCO or Novell — was recently reopened. Since that's the only thing SCO might own that would have real value, I can see Cahn keeping SCO's doors cracked open long enough for that issue to be resolved.

That all this means is that I think SCO will stagger on into 2010.

Sigh. The right to license is SCO's already. So what would they need copyrights for, if not to sue folks? Some may not have noticed what the original SCOsource plan ultimately entailed, a SCOsource license to run AIX. Note this testimony from Chris Sontag in the SCO v. Novell trial last year:
Q. Now, if you could take a look at that e-mail on the second page, in the middle of the page, it's an e-mail from Jeff Hunsaker at SCO to yourself, Mr. McBride and others at SCO. And it's sent on July 31, 2003, correct?

A. Yes.

Q. And what was Mr. Hunsaker's position -- his position at SCO was Senior Vice President of Worldwide Sales and Marketing, right?

A. I believe that to be the case.

Q. And Mr. Hunsaker currently is the president and CEO of SCO, right?

A. I think at least the president of SCO Operations or something like that. I'm not sure what his exact title is now.

Q. And what he said in the middle of 2003, this e-mail followed a conference call about this SCOsource licensing program, right?

A. Yes.

Q. And the subject line there is: SCOsource issues and buyoff, correct?

A. Yes.

Q. And he wrote Darl, Chris, Kim and Kevin, correct?

A. Yes.

Q. And then he wrote:

During our SCOsource con call today, we discussed and would like to propose the following. The official name of this program will be the SCO UNIX IP Compliance License Program.
Correct?

A. Yes.

Q. And that's the name that was eventually used for this program of these contracts that we have just been through, right?

A. Yes, at least for a period of time.

Q. And then he wrote ... This is not a Unixware 7.13 SKU, right?

A. Yes.

Q. And then he wrote:

The license is called a SCO UNIX IP license for Linux. The only rights that this license provide is for Linux binary runtime copies. When we are ready to issue a similar license for AIX, it will be called the SCO UNIX license for AIX.
That was the dream, and I believe it still is. It would explain being willing to keep trying to get those copyrights. IBM has deep pockets, and that tends to inspire litigation. But if you bother to sue one, why not Linux too, if you have the copyrights and can prove infringement, neither of which I consider possible. But if they do, they may decide it's worth continuing to reach for the brass ring. And I notice Mr. Hunsaker, who composed that email, isn't terminated. So anyone who thinks this is over probably hasn't been paying close enough attention to the background stories. Darl is now, I would opine, the fall guy.

So... I wonder what McBride will put on his resume?

Update: I just noticed the date of the termination was October 14. So when Maureen O'Gara wrote, in an article dated October 16, that Darl "expects to get fired any minute"...? Well, what can I say? The perfect ending. [ http://in.sys-con.com/node/1147274]

Update 2: Not so fast, m'hearties. According to the Salt Lake Tribune, McBride didn't find out until today:

McBride, who learned of his ouster on the Internet Monday morning, also said in an interview it appears to him that the trustee is looking to lay off employees or cut pay as part of an attempt to wind down the company and settle the lawsuits.

"I think what they are heading for is either the business gets wound down and sold off and then what's left is the litigation," McBride said. "At that point, what it appears they are angling for is to settle the litigation for what I think are pennies-on-the-dollar type of numbers."

This may be why he isn't the CEO any more, talking still about IBM and Novell paying SCO instead of the other way around. Anyway, McBride says he is rustling up some money, maybe from Cerberus Capital Management of New York, and that he and 50% of the shareholders will present a different plan, while Cahn sticks with Norris. Say, what? Yes. That is what it says:
McBride said his status as a shareholder gives him the ability to act in bankruptcy court. He said he has the backing of around 50 percent of shareholders for what might turn out to be an alternative plan to exit bankruptcy that could include new investment, perhaps from Cerberus or others.

"I'm putting together an alternative plan ... that will ultimately get SCO its day in court," he said.

Novell and IBM also declined to comment.

The SCO statement indicates that Cahn might follow a previously proposed plan that would sell the Unix business to a company formed by Stephen Norris, the head of a private equity firm, Gulf Cap Partners, and a London-based entity.

So Norris dumped McBride too? What is going on? Surely it can't be believed that the bankruptcy judge, having appointed the Chapter 11 Trustee, seeing that he has ousted McBride, would then go with McBride's plan over the Trustee's? Ah, but this is the SCO soap opera, and you have to tune in tomorrow.

Update: An 8K on Hunsaker leaving:

On November 13, 2009, Jeff F. Hunsaker, President and Chief Operating Officer, SCO Operations, Inc. (“SCO”) announced that he will be transitioning out of the company, effective immediately, to pursue other opportunities. Mr. Hunsaker will act as a consultant, subject to bankruptcy court approval, to SCO over the next several months in order to assist the company with its UNIX business opportunities. Senior management personnel of SCO, including Ken Nielsen, Chief Financial Officer, Alan Raymond, Vice President of Worldwide Sales, Andy Nagle, Senior Director of Engineering and Hans Bayer, Vice President of International Operations will collectively assume Mr. Hunsaker’s duties and will continue to manage the business and to serve SCO’s UNIX customers in conjunction with the Chapter 11 Trustee, Edward Cahn, and his advisors. Ryan Tibbitts, General Counsel, will continue to work with Mr. Cahn in directing and pursuing the company’s legal claims.

  


Darl McBride Out; SCO Looking to Sell "Non-Core Assets" | 426 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections Thread
Authored by: tyche on Monday, October 19 2009 @ 12:08 PM EDT
Please note the correction in the title, and show where the correction is in the
body. Thanks

Craig
Tyche

---
"The Truth shall Make Ye Fret"
"TRUTH", Terry Pratchett

[ Reply to This | # ]

So where's the restructuring plan?
Authored by: Laomedon on Monday, October 19 2009 @ 12:10 PM EDT
Shouldn't the plan be presented to the BK court?

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: Anonymous on Monday, October 19 2009 @ 12:10 PM EDT
Happy Monday Darl!!

[ Reply to This | # ]

Always sad to see someone lose their job
Authored by: Pop69 on Monday, October 19 2009 @ 12:10 PM EDT
but in this case I think it was richly deserved and should have been done far,
far sooner.

[ Reply to This | # ]

Off Topic Thread
Authored by: tyche on Monday, October 19 2009 @ 12:11 PM EDT
Put topics that do not pertain to either the article or the News Picks here.
Please not the "Important Stuff" noted above the "Submit
Comment" button. Thanks

Craig
Tyche

---
"The Truth shall Make Ye Fret"
"TRUTH", Terry Pratchett

[ Reply to This | # ]

News Picks Thread
Authored by: tyche on Monday, October 19 2009 @ 12:13 PM EDT
A place to put comments on items in the News Picks. Please include the title
and link to the News Pick, since the News Picks tend to scroll off the screen
fairly quickly. Thanks

Craig
Tyche

---
"The Truth shall Make Ye Fret"
"TRUTH", Terry Pratchett

[ Reply to This | # ]

Losing Darl may win investors
Authored by: Anonymous on Monday, October 19 2009 @ 12:21 PM EDT
I've been thinking this for the last two years. Darl is so toxic, no one wants
to deal with him.

I think Cahn, as a Chapter 11 trustee, had an obligation to give this a try, to
see if he can attract any legitimate investors. Even so, I don't think the
surviving "team" can rest easy just yet.

I also think it is a message to the 10th Circuit, so that the appeal doesn't
collapse. Cahn also has an obligation, I think, to get a legitimate ruling on
the merits. I think we'd like one, too. McConnell needs to be reversed.

----------------------

Dilbert IS reality.

[ Reply to This | # ]

Darl McBride Out; SCOXQ trading falls
Authored by: Anonymous on Monday, October 19 2009 @ 12:21 PM EDT
SCO's announcement of the termination was dated Oct. 14.

Trades of SCOXQ stock in the three trading days Oct. 14, 15, & 16 totaled
-- zero.

Coincidence? Could be.

Wendell Cochran
West Seattle

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: JamesK on Monday, October 19 2009 @ 12:24 PM EDT
"Other than Darl, I mean."

Yeah, he probably wouldn't bring in much. ;-)


---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

Continued Litigation.....
Authored by: Anonymous on Monday, October 19 2009 @ 12:31 PM EDT

My best guess is that Mr. Cahn has not had an opportunity to look into the merits of the IBM case yet. He was informed (remember, my best guess):

    We own the Unix Copyrights... all our other litigation is based on that!
As a result, if the appeal fails, he probably thinks all the other lawsuits are toast. I doubt he realizes currently the case against IBM does not depend on who owns the Unix copyrights.

IBM has so many defenses and what appears to be solid counter-claims ..... I really look forward to the day Mr. Cahn reviews the current state of the SCOG vs IBM case.

I understand the Trustee has to do his best with what he has available, but I doubt that means plowing forward against such overwhelming odds. I also doubt it means to proceed when the Law and Facts are so heavily stacked against.

RAS

[ Reply to This | # ]

eliminating the positions vs firing the person
Authored by: Anonymous on Monday, October 19 2009 @ 12:31 PM EDT
This sounds more like a redundancy than a sacking. Will he get a payout in
compensation for the loss of his job?

[ Reply to This | # ]

McBride "sock-puppet" posts to Y!IBM board
Authored by: Anonymous on Monday, October 19 2009 @ 12:48 PM EDT
A Y nym that can trivially be associated with a known valid McBride family email posted the following message to the Y!IBM message board after midnight (MDT) on Friday/Saturday 10/16-17.

The nym is the same used during a May-June campaign against Mark Robbins on other boards. A "feature" of the Y Nym system allows the diligent to associate groups of names with each other, and this nym can be traced to much earlier posting on the SCOX Y board and other usages.

The "skyline cowboy" URL does not generate a valid page. In the past, even deleted "rewards" have been extractable by URL editing. It is possible no page was ever actually loaded. The skylinecowboy tweet account loaded a similar message concurrently, but has since "deleated" that posting. Deleted messages are recoverable through the use of a third party webpage tweleted.com

The most interesting feature of this post is how it demonstrates El ingenioso hidalgo Darl Quijote de la Mancha continues his campaign after he has been firmly ejected.

sevenclubfed
17-Oct-09 04:08 am
$12,000 Reward for IBM Executive Criminal Conduct

New posting on skylinecowboy.com for $12,000. Pays out for evidence that Palmisano or other IBM execs were illegally involved in the Moffatt insider trading felony case. Also pays for evidence of ANY kind of criminal conduct by an IBM executive.
http://www. skylinecowboy.com/detail.asp?id=20
Rating : (4 Ratings)

[ Reply to This | # ]

How much do you want to bet...
Authored by: Anonymous on Monday, October 19 2009 @ 12:49 PM EDT
...that Darl sues tSCOg for unfair (or whatever the legal term is) termination.

[ Reply to This | # ]

Shareholder revolt?
Authored by: SRL on Monday, October 19 2009 @ 01:08 PM EDT
PJ mentions a threatened "shareholder revolt". I don't follow: what
can the shareholders do now that the company is in Chapter 11 and being run by a
trustee?

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: Anonymous on Monday, October 19 2009 @ 01:20 PM EDT
Maybe Darl will drop by here to tell us the real story now? :)

[ Reply to This | # ]

This may be a dumb question but ...
Authored by: Anonymous on Monday, October 19 2009 @ 01:21 PM EDT
I thought the trustee was supposed to replace the existing management.
Shouldn't Darl have been gone before now?

[ Reply to This | # ]

Just good sense on the Trustee's Part
Authored by: MDT on Monday, October 19 2009 @ 01:32 PM EDT
Hey everyone,
Don't jump to too many conclusions about the 'We will continue the litigation'
decision.

If you think about it, the Trustee *HAD* to do that. There are too many
countersuits already in the works or waiting to hit the deck if he comes out and
says 'We'll discontinue the litigation, it was bogus'.

The trustee has to try to make sure the company can survive, and if he doesn't
kill the countersuits, they'll go down in flames no matter what.

This is a negotiation tactic. I'm betting he's already attempting to
negotiate with Novell, Redhat and IBM. If he can get out of court settlements
that agree that SCO owes no additional monies (even if they have to admit to
criminal behaviour) then that is likely where he is going. He can even
voluntarily pierce the veil if he needs to and turn over evidence against
McBride.

If I were McBride I'd be sweating bullets right now. The trustee is in
charge, and he has access to the company records. The trustee has no connection
to McBride, and no reason not to toss him to the wolves to save the company, and
every reason to do so if it's a viable tactic.

---
MDT

[ Reply to This | # ]

Terminated as in...?
Authored by: billyskank on Monday, October 19 2009 @ 01:57 PM EDT

The Terminator

;)

---
It's not the software that's free; it's you.

[ Reply to This | # ]

Because it must be said...
Authored by: Lazarus on Monday, October 19 2009 @ 01:57 PM EDT
Na na na na, na na na na, hey hey hey, good-bye.



But for some real substance, how long before a MOG piece on how this was the
completely wrong decision?

---
Any incoherancies on my part should be blamed on my use of Vicodin.
Unfortunately, it's for my back, so I'm not quite a House clone.

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: sschlimgen on Monday, October 19 2009 @ 02:43 PM EDT
So ... my interpretation of this development is:

Someone at the far end of the tunnel is trying to strike a spark into damp
tinder.

---
Meandering through life like a drunk on a unicycle.

[ Reply to This | # ]

He's entitled to go down with ...
Authored by: Latesigner on Monday, October 19 2009 @ 02:58 PM EDT
... the good ship SCO.

If this had been done years ago it would have made some sense.

Now I just think it's part of some deal a State AG will have to figure out some
day.

---
The only way to have an "ownership" society is to make slaves of the rest of us.

[ Reply to This | # ]

SCOsource con call
Authored by: grouch on Monday, October 19 2009 @ 03:02 PM EDT

"During our SCOsource con call [...]"

At least it was named appropriately.

---
-- grouch

GNU/Linux obeys you.

[ Reply to This | # ]

Darl McBride Out!
Authored by: rsi on Monday, October 19 2009 @ 03:05 PM EDT
Hopefully Darl is contemplating retirement, at least until he is
indited/tried/convicted/sentenced/imprisoned by the Feds! I can't imagine ANY
company EVER hiring him again! ;^)

TERMINATED! Finally!!! Why don't they just announce Chapter 7 and end this
nightmare???

[ Reply to This | # ]

PJ - "Darl is now, I would opine, the fall guy"
Authored by: Brian S. on Monday, October 19 2009 @ 03:29 PM EDT
You bet he is.

Personally, I believe this whole scam was arranged in a Seattle
hotel room at the turn of the century when MS and Ralph Yarro resolved the
Caldera dispute.

Darl was just the hired pit bull.

Any reading into MOG's
Friday's and future articles has to be based on where you believe her ultimate
loyalties lie.

Are they with MS + Yarro(the majority shareholder) or Darl
McBride(does he even own any shares?) ???

[ Reply to This | # ]

SCOX up $.04. Is it
Authored by: joef on Monday, October 19 2009 @ 03:46 PM EDT
because Darl was canned or because the lawsuits will continue?

[ Reply to This | # ]

  • Or... - Authored by: Anonymous on Monday, October 19 2009 @ 05:49 PM EDT
    • Or... - Authored by: tiger99 on Tuesday, October 20 2009 @ 03:05 AM EDT
"...a leading provider of UNIX® software technology..."
Authored by: crs17 on Monday, October 19 2009 @ 03:52 PM EDT
When did SCO change its boilerplate? At the top of this press release, SCO
calls itself "...a leading provider of UNIX® software technology." If
I remember right, this is where SCO would normally refer to itself as "the
owner of Unix." Even after they lost their claim to Unix ownership in
court, I believe they were still claiming that in their boilerplate
self-description.

Have we seen this "...leading provider..." verbiage before?

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: Anonymous on Monday, October 19 2009 @ 03:54 PM EDT
"So... who is the puppet master?"

That would be Project 2501.

--
BMO - ringing the doorbell and running away.

[ Reply to This | # ]

Does this mean that we can finally make funeral arrangements for SCO?
Authored by: Anonymous on Monday, October 19 2009 @ 04:39 PM EDT
Steven J. Vaughan-Nichols observes "the question of who actually
"owns Unix's intellectual property — SCO or Novell — was recently
"reopened.'

Umm, doesn't "Unix's intellectual property" expressed in such
general terms, belong to most everybody? I've got a bent dime says
neither SCO nor Novell want that to become public knowledge, as in
all over the tabloids. Certainly their lawyers don't want an answer to
the question, because it would kill the litigation stone dead.

[ Reply to This | # ]

Good riddance to bad rubbish. Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: SilverWave on Monday, October 19 2009 @ 04:52 PM EDT
You were a disgrace.

Glad to see you go.

---
RMS: The 4 Freedoms
0 run the program for any purpose
1 study the source code and change it
2 make copies and distribute them
3 publish modified versions

[ Reply to This | # ]

What could have been... sigh.
Authored by: FoxyLad on Monday, October 19 2009 @ 05:39 PM EDT
Throughout this sorry saga, I've always had a picture of what SCO could have
been.

It really isn't that far fetched to imagine a better CEO could have shepherded
them into becoming the corporate Linux of choice. With their pedigree, they
could easily be where Red Hat is now.

Instead the board hired Darl - pretty much the most destructive CEO you could
find. They must have known his litigious bent - it's such a shame he didn't
follow his brother into law, it's where his passion is.

So to my mind, it was the board that were incompetent, hugely derelict in their
duty, or corrupt. Darl should have been jettisoned long ago, but the board
should have been given the bum's rush even earlier. I'm just glad they aren't
directors of any companies I own - in a fair world, they would be laughed off
every board they sit on.

One final thing - conspiracy theories are lots of fun, but I'm not going to buy
them until there is real evidence. Firstly Hanlon's razor is a powerful
instrument; and second they say more about your prejudices than anything else.
For instance, you could argue that things have worked out very nicely for Red
Hat - maybe they wanted to spike the cannons of the only real competition in
their sphere. It's almost as plausible as Microsoft. And both are a lot less
plausible than a board making a really stupid hiring decision.

---
All generalisations are dangerous... including this one.

[ Reply to This | # ]

No mention of a severance package ...
Authored by: Anonymous on Monday, October 19 2009 @ 05:45 PM EDT
... or termination bonus or departure incentive or whatever they want to call it
this time. (Unless I missed it during my quick read.) If there were one, it
would undoubtedly contain a clause where he agrees not to sue. It looks to me
as though he might have refused any package, intending to take them to the
courts. As the cliche says, with friends like that, who needs enemies?

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: dio gratia on Monday, October 19 2009 @ 05:55 PM EDT
REGISTRATION STATEMENT UNDER SECURITIES ACT OF 1933 As filed with the Securities Exchange Commission on May 2, 2006 (Page 7:)
If we are unable to retain key personnel in an intensely competitive environment, our operations could be adversely affected.

We need to retain our key management, technical and support personnel. Competition for qualified professionals in the software industry is intense, and departures of existing personnel could be disruptive to our business and might result in the departure of other employees. The loss or departure of any officers or key employees could harm our ability to implement our business plan and could adversely affect our operations. Our future success depends to a significant extent on the continued service and coordination of our management team, particularly Darl C. McBride, our President and Chief Executive Officer.

"Here lies a toppled God, his fall was not a small one. We did but make his pedestal a narrow and tall one."

[ Reply to This | # ]

Darl's resume
Authored by: Anonymous on Monday, October 19 2009 @ 06:13 PM EDT

So... I wonder what McBride will put on his resume?

Well, let's see:

2003-2009: CEO of SCO group. Fired after the stock price went from $2 to 15 cents and the company went into Chapter 11.

2000-2003: President of Franklin Covey. During this time the stock price of Franklin Covey fell from $20 to under $1. (After he left the stock price recovered).

1998-2000: Involved in two startups, SBI and Pointserve. Both sank without trace after burning through several million dollars, some of which were paid to Darl.

1996-1998: Vice-President of IKON. Fired.

1988-1996: Various manager positions at Novell. Hired directly into a management role with no track record. (What was was Novell thinking of?)

Education: Degree in Sociology at Brigham Young U.

Foreign language skills: claims to be "fluent" in Japanese. At least one Japanese who has spoken with McBride described his command of the language as "OK but not fluent".

Some sources allege that Mr McBride has a Master's degree in Industrial Relations from the University of Illinois. I'll believe that when I see a transcript from the U of Illinois.

Special talents: persuasive talker, as evidenced by the fact that he has succeeded in talking himself into a number of highly-paid jobs for which he was completely unqualified.

[ Reply to This | # ]

Candid Shot of Darl's Reaction
Authored by: Tim Ransom on Monday, October 19 2009 @ 07:18 PM EDT
Link

---
Thanks again,

[ Reply to This | # ]

  • LOL n/t - Authored by: Anonymous on Tuesday, October 20 2009 @ 12:48 PM EDT
Sigh of relief
Authored by: om1er on Monday, October 19 2009 @ 07:44 PM EDT
I breathed a sigh of relief when I heard the news.

This is a tremendously wonderful thing!

Now, perhaps we can get some sanity out of SCO, instead of the intentional or
unintentional "scourge of the universe" junk that has emanated from
there for many years.

Perhaps they want to rejoin humanity and be decent? I certainly hope so.

---
August 10, 2007 - The FUD went thud.
October 19, 2009 - Darl McBride went thud.

[ Reply to This | # ]

  • Oh, no - Authored by: Anonymous on Tuesday, October 20 2009 @ 04:44 PM EDT
    • Oh, no - Authored by: om1er on Tuesday, October 20 2009 @ 07:37 PM EDT
PJ asks why
Authored by: Anonymous on Monday, October 19 2009 @ 08:31 PM EDT
Maybe because he's been caught lying too many times to have credibility?

If the intent really is to pursue the litigation, they probably do not want a
CEO (and most likely to be called as a witness) who has a documented history of
lying under oath.

[ Reply to This | # ]

Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: PolR on Monday, October 19 2009 @ 11:28 PM EDT
Darl trying to make another reorganization plan? If he could pull out one he
would have done so while he was still in charge. This is just the last gasp of a
recalcitrant corpse.

I wonder why Norris still bother with SCO. Doesn't he have anything better to
do?

[ Reply to This | # ]

Darl is now, I would opine, the fall guy. -- Dixit PJ
Authored by: PolR on Monday, October 19 2009 @ 11:36 PM EDT
Yes and it appears he is an angry fall guy that won't let things wrap up
smoothly. If I were the PIPE fairy, this is the opposite of what I would want.

[ Reply to This | # ]

Cerberus
Authored by: Anonymous on Monday, October 19 2009 @ 11:48 PM EDT
These are the folks who:



In 2007, Cerberus and about 100 other investors purchased an 80% stake in
Chrysler for $7.4 billion,[5] promising to bolster the auto maker’s performance
by operating as an independent company. In 2008, the plan collapsed due to an
unprecedented slowdown in the U.S. auto industry and a lack of capital.[6] In
response to questioning at a hearing before the House committee on December 5,
2008 by Rep. Ginny Brown-Waite, Chrysler President and CEO Robert Nardelli said
that Cerberus' fiduciary obligations to its other investors and investments
prohibited it from injecting capital.[6]

On March 30, 2009, it was announced that Cerberus Capital Management will lose
its equity stake and ownership in Chrysler as a condition of the Treasury
Department’s bailout deal, but Cerberus will maintain a controlling stake in
Chrysler’s financing arm, Chrysler Financial. Cerberus will utilize the first $2
billion in proceeds from its Chrysler Financial holding to backstop a $4 billion
December 2008 Treasury Department loan given to Chrysler. In exchange for
obtaining that loan, it promised many concessions including surrendering equity,
foregoing profits, and giving up board seats:

"In order to achieve that goal Cerberus has advised the Treasury that
it would contribute its equity in Chrysler automotive to labor and creditors as
currency to facilitate the accommodations necessary to affect [sic] the
restructuring."[7]

Chrysler Financial refused to take $750 million in Troubled Asset Relief Program
(TARP) government bailout aid because executives didn't want to abide by
executive-pay limits, and because the firm doesn't necessarily need the
money.[8]

On April 30, 2009, Chrysler declared bankruptcy protection and announced that
GMAC will become the financing source for new wholesale and retail Chrysler
cars.[9]


http://en.wikipedia.org/wiki/Cerberus_Capital_Management

[ Reply to This | # ]

Because I'm a nag about the SEC filings ....
Authored by: Anonymous on Tuesday, October 20 2009 @ 01:56 AM EDT
Well, one thing that has NOT drawn comment is the status of
the SEC filings.

On 28/Aug/09 SCO filed an 8K touting it's future but they
were months late filing the required comprehensive quarterly
accounting, their 2nd quarter 10-Q.

As of this date, they are late on two 10-Q's and have failed
to even file the required late-filing-notice for the 3rd
quarter report.

Releasing Mr. McBride saves $300-450k per year, but they
really need some basic recording and reporting staff to do
the grunt work. Why not report they hired a competent A/R
clerk!

tps

[ Reply to This | # ]

No, PJ, I disagree
Authored by: Anonymous on Tuesday, October 20 2009 @ 02:53 AM EDT

Darl is now, I would opine, the fall guy.

A "fall guy" is a person used as a scapegoat to take the blame for someone else's actions. It's inappropriate to call Darl a "fall guy" because the actions were his own.

McBride is primarily responsible for destroying SCO, which had a chance to be a viable company before he drove it into fantasyland. He destroyed jobs of a lot of good people who used to work at SCO. He deserves all the blame he gets.

What he does not deserve is the millions of dollars in salary and bonuses he got while leading the company down the tubes.

[ Reply to This | # ]

The Shareholders are Revolting!
Authored by: Ian Al on Tuesday, October 20 2009 @ 04:06 AM EDT
If I can't have the 'OT' thread, at least I get the headline. I think that Yarrow is still a major shareholder after the Canopy affair.

Anyway, when Judge Gross decided on a Chapter 11 trustee, I speculated at the time that going into Chapter 7 would lose the trustee the BS&F capped-fee litigation support. The US Trustee quizzed BS&F, some time ago, about how much of the capped fee was unspent. I suspect he was not satisfied with the answer. We, later, had BS&F complaining to the press that the cases were now costing it money since the costs had hit the cap.

I wonder if the US Trustee and Judge Gross discussed this before the Chapter 11 Trustee decision and decided that it made more sense to retain the 'free ride' since the litigation would still have to be resolved even in Chapter 7. The Trustee wouldn't declare 'we have lost the litigation and it is up to BS&F to negotiate the best settlement'. He would keep his options open in case of a Micawber moment. So now BS&F continue to pay for the free helter-skelter ride.

move the intellectual property litigation forward with Boies, Schiller & Flexner, LLP

---
Regards
Ian Al

Linux: Viri can't hear you in free space.

[ Reply to This | # ]

Quotes by and about Darl
Authored by: Anonymous on Tuesday, October 20 2009 @ 10:59 AM EDT
http://en.wikiquote.org/wiki/Darl_McBride

There are some gems in there...

[ Reply to This | # ]

latest in: MoG on the McBride 'firing'
Authored by: Anonymous on Tuesday, October 20 2009 @ 01:25 PM EDT
By Maureen O'Gara October 20, 2009 09:15 AM EDT

SCO CEO Darl McBride may go down in history as the first CEO to be fired over the Internet.

SCO sent an 8-K filing to the SEC Monday morning saying that it fired him last Wednesday, which was news to him because as of Sunday nobody had told him he was fired even though he was expecting it ..

According to McBride Cahn is a figment trustee, having sloughed off his responsibilities to the chic-chi mainline Philadelphia law firm Blank Rome that he's connected with in his retirement, which is apparently bent on draining SCO of the last dime it has in the bank ...

[ Reply to This | # ]

His Best Skill - Darl McBride Out; SCO Looking to Sell "Non-Core Assets"
Authored by: Anonymous on Tuesday, October 20 2009 @ 04:51 PM EDT
"Litigation is his best skill..."

I would beg to differ with you in this evaluation. To the best of my knowledge
SCOG did not make sure they owned the copyrights to Unix before beginning their
litigation campaign.

To my mind this is a critical litigation error. If they had held back on
firing the first legal volley, they might have been able to obtain those
copyrights from Novell.

Once they started, however, it was easy for Novell to see what was up.
Obviously Novell's Suse Linux business would suffer if SCOG was successful.
Further, in spite of the stock bumps, SCOG would be millions ahead by now,
possibly even still out of bankruptcy, instead of wasting the money on these
lawsuits.

You might argue that the intent wasn't to get five billion out of IBM but
convince IBM it would be cheaper to buy SCOG rather than fight the lawsuit. If
that was the case, then obviously his "litigation skill", proved
deficient here as well.

When they sued Daimler Chrysler they didn't even take to trouble to find out if
the Unix software they were using as a basis of their suit was still in use, or
what the correct address for service should be.

Perhaps the strongest case you might make for his "litigation skills"
was in providing a stock bump for a pump and dump scheme.

I don't know who made what with the stock, but clearly any future potential for
the stock is minuscule. Perhaps a nice piece of souvenir paper to hang on the
wall of a museum. It is extremely unlikely that any legal steps at this time
will have a significant impact in attracting outside money for SCOG stock
purchases. So it is easy to see how his "litigation skills" are no
longer useful in this regard.

[ Reply to This | # ]

funniest quote MOG
Authored by: Anonymous on Tuesday, October 20 2009 @ 04:59 PM EDT
"And it took a hacker to find the press release that SCO told the SEC it
had issued saying McBride was toast."

It must drive her nuts not knowing how to get her hands on an SEC report.

[ Reply to This | # ]

So Darl's the big winner in all this!
Authored by: Anonymous on Tuesday, October 20 2009 @ 06:14 PM EDT
So as far as I can tell, during the last many years
  • Darl's been paid handsomely (mostly in cash not stock; and probably with Novell's money.)
  • Darl's brother's been paid well as well
  • Microsoft managed to keep Linux under a cloud, from before Vista launched til they got Win7 out.
  • Noone got investigated for fraud or anything similar.
So is Darl the big winner here? Or can anyone else involved claim an even bigger victory?

[ Reply to This | # ]

Tenth Circuit Ruling?
Authored by: Anonymous on Tuesday, October 20 2009 @ 06:15 PM EDT
Has there been a ruling yet on Novell's motion for the en banc rehearing?

[ Reply to This | # ]

Darl, Maureen O'Gog and a superb find by Stats
Authored by: Brian S. on Tuesday, October 20 2009 @ 10:35 PM EDT
Stats really turns some stuff up, this from his post at IV:

Darl changed his email to a "hotmail" account at 7AM MDT on 10/16 Part of the mythos of the El ingenioso hidalgo Darl Quijote de la Mancha is the claim that he learned of his dismissal via the internet on Monday morning

. A DarlMcBride twitter account posted this early Friday (10/16) morning: As of today, my new email address is darlmcbride@h0tmail.c0m

(metadata) class="published timestamp" data=" time:'Fri Oct 16 14:22:49 +0000 2009 7:22 AM Oct 16th from web (ed. Pan kludged the domain, even DMC doesn't deserve spam, though spiders on Tweetville will have already harvested the plaintext verstion) The twitter account is almost surely genuine (cross linked with Hunsaker, Brazell and similar accounts)

What is the strategic reason for repeating the Monday-via-the-internet "little white lie" to O'Gara and the Trib reporter.

What can you say???

[ Reply to This | # ]

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