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Want to Buy SCO's Software Business?
Monday, August 09 2010 @ 10:33 PM EDT

SCO would like to sell it. "As is, where is", they say. It defines what it is selling as "essentially all of the Debtors' software business assets". Excluded is SCO Japan and SCO Canada and the litigation rights regarding Novell, SUSE, IBM, Red Hat, etc. You also don't get "Seller’s rights and obligations with respect to the SVRX Licenses (as defined in the Santa Cruz-Novell APA)". So... you buy the business, but SCO then contacts all your customers every month or so to collect money for Novell? Caveat emptor, y'all.

"Additional Disclosure Schedules may be added Upon Finalization of Agreement," SCO says. Like... um... the buyer? Little details like that? I mean who'd want the business on these terms, I wonder? Ralph Yarro? Darl? Whoever it is, he or she is ready to roll:

At the Trustee’s request, OPA has begun the process of marketing the Debtors’ business by preparing a due diligence room and marketing materials, identifying potential purchasers and engaging in preliminary discussions with certain interested parties. Immediately upon approval of this Motion, OPA is poised to commence the sale process without delay.
So. An auction. Kind of like Jeapordy, though, with certain interested parties ready to hit the buzzer. But, you may say, what about Novell? It blocked SCO earlier from selling these same assets:
14. Before the appointment of the Trustee, the Debtors attempted to sell their assets and were met with objections by Novell, based on, inter alia, the uncertainty of the Debtors’ rights in the UNIX and UnixWare copyrights in light of the then pending Utah Litigation. Now that the 10th Circuit, the District Court on remand and the jury have ruled and the Debtors’ interest in the Acquired Assets is clarified, the Trustee seeks to sell the Acquired Assets to maximize value for the estates.
What about the appeal? Isn't SCO planning to win? What happens to the assets is SCO were to win? I guess then Novell can't get them to pay off their damages, as the assets transfer without encumbrances. Oh, say. Another smooth move from SCO. SCO wanted payment of the costs to Novell to wait for an appeal, but the assets it wants to transfer asap. SCO really doesn't want to pay Novell, I guess. It sees the handwriting on the wall, and it wants the software business off the table and in a friendly pocket. That's how it looks to me.

It also wants to hire a firm, King & McCleary, to do taxes for SCO. It believes SCO lacks the employees necessary to do the job. And the job is federal and state tax returns for *2008* and 2009:

Based upon the status of these chapter 11 cases and the state of the Debtors' businesses, the Trustee believes that the engagement of King & McCleary is necessary in order to bring the Debtors into compliance with applicable non-bankruptcy law. Specifically, the Trustee does not believe that the Debtors have the necessary staff to perform the Tax Services internally.
2008? It proposes August 23rd be the date for a hearing on this motion. "Stalking Horse Identified, if any" on October 11, with the qualified bid deadline set for October 5. The documents says there could be one or more buyers. Then the auction on November 1 and a projected closing date of November 30.

Here are the filings:

08/09/2010 - 1140 - Motion to Approve // Motion for an Order Authorizing the Engagement of King & McCleary, LLC to Perform Certain Tax Return Services Filed by Edward N. Cahn, Chapter 11 Trustee for The SCO Group, Inc., et al.. Hearing scheduled for 8/23/2010 at 03:00 PM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #3, Wilmington, Delaware. Objections due by 8/16/2010. (Attachments: # 1 Notice # 2 Exhibit A # 3 Proposed Form of Order # 4 Certificate of Service) (Fatell, Bonnie) (Entered: 08/09/2010)

08/09/2010 - 1141 - Motion to Approve Sale // Motion Of The Chapter 11 Trustee For Order (1) Authorizing The Marketing, Auction And Sale Of Substantially All Of The Debtors Software Business Assets Consistent With Form Asset Purchase Agreement And Free And Clear Of Liens, Claims And Encumbrances, (2) Authorizing Assumption, Assignment, And Sale Of Certain Executory Contracts And Unexpired Leases, (3) Approving Bidding Procedures In Connection With Auction, (4) Establishing Sale Hearing Date And (5) Granting Related Relief Filed by Edward N. Cahn, Chapter 11 Trustee for The SCO Group, Inc., et al.. Hearing scheduled for 8/23/2010 at 03:00 PM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #3, Wilmington, Delaware. Objections due by 8/16/2010. (Attachments: # 1 Notice # 2 Exhibit 1 - APA # 3 Exhibit 2 # 4 Exhibit 3 - Sale Procedures Order # 5 Certificate of Service) (Fatell, Bonnie) (Entered: 08/09/2010)

Here's an interesting couple of paragraphs from the proposed APA about intellectual property and licenses:
4.8 Licenses and Permits. Seller possesses all material licenses, permits, approvals and notifications, governmental or otherwise, necessary for the operation of the Business, all of which are set forth in Schedule 4.8, except where the failure to have such license, permit or approval would not have a material Adverse Effect on the Business. Except as set forth in Schedule 4.8, all of such licenses, permits, approvals and notifications are freely assignable and transferable to Buyer at the Closing and will continue to be in full force and effect after such transfer.

4.9 Intellectual Property. Except as set forth in Schedule 4.9, Seller owns, or has the right to use, all Intellectual Property used in the conduct of the Business as currently conducted that is material to Seller, taken as a whole. Except as would not reasonably be expected to have a Material Adverse Effect, Intellectual Property used in the conduct of its Business as currently conducted that is material to Seller (a) does not, to the knowledge of Seller, infringe on or otherwise violate the rights of any Person and (b) is in accordance with any applicable Contract pursuant to which Seller acquired the right to use any Intellectual Property.

It doesn't own the copyrights, and yet whoever buys the software business is told it has all it needs. So. Did some SCOfolk fib about how necessary it is to own copyrights to run a software business?

Here's the APA's disclaimer:

4.10 Disclaimer. THIS IS AN “AS IS, WHERE IS” SALE. EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION 4, NONE OF SELLER NOR ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, REPRESENTATIVES OR THE TRUSTEE OR ITS AFFILIATES, AGENTS OR REPRESENTATIVES, MAKES OR HAS MADE ANY OTHER REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WRITTEN OR ORAL, AT LAW OR IN EQUITY, IN RESPECT OF SELLER, THE ACQUIRED ASSETS OR THE BUSINESS. SELLER DISCLAIMS ANY OTHER REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, INCLUDING AS TO THE CONDITION, VALUE OR QUALITY OF THE ACQUIRED ASSETS OR THE BUSINESS, MERCHANTABILITY, USAGE, TITLE, SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE. EXCEPT AS SET FORTH IN THIS SECTION 4, THE CONDITION OF THE BUSINESS AND THE ACQUIRED ASSETS SHALL BE “AS IS” AND “WHERE IS”.
Here's what you get:
ACQUIRED ASSETS

[List to be Completed, Reviewed and Revised by SCO Personnel as appropriate and is subject to change]

(a) UnixWare Operating System Products
  • SCO UnixWare 7 Release 7.1.4
  • SCO UnixWare 7 Release 7.1.3
  • SCO UnixWare 7 Release 7.1.2
  • SCO UnixWare 7 LKP

(b) OpenServer Operating System Products

  • SCO OpenServer Release 6.0
  • SCO OpenServer Release 5.x (including all prior versions and releases)

(c) Layered Operating System Products

  • SCO UnixWare and OpenServer Development Kits (all version)
  • SCO Office
  • SCO Open UNIX Development Kit
  • SCO UnixWare 7 Online Data Manager
  • SCO UnixWare 7 Disk Mirroring
  • SCO UnixWare “OS Compatible” Requirements o SCO UnixWare OpenServer Kernel Personality (OKP)

(d) Mobility

  • Internal use of SCO Mobile Server
  • Internal use of HipCheck
You also get some trademarks. Here's the "Third Party Software":

Component Third Party Licensor
Adobe Flash Player California Software Labs
Advanced Server & LAN Manager- AFPS ATT
Backup Edge Microlite
Binary Drivers in UnixWare various OEMs and IHVs
C++ Compiler, Debugger, C++ Expression Evaluation EDG
Cheyenne Arcserve Computer Associates
Compaq Hot Plug PCI Software HP (Compaq)
DSHM – Dynamic Shared Memory Libraries EMC (was Data General)
I2O Symbios
Java Sun
License Key Management (ifor_LS, brand, PMD/SLD, License Manager) Isogon (Gradient)
Merge 5.3 and Me4rgePRO Win4Lin
Microsoft Xenix Code in old SVRX Microsoft
NetScape Components AOL
NetWare Novell
Office Mail Server Bynari
Open Desktop Secureware Hewlett-Packard
PP Sun
Reliant HA Siemens
SGI NFB Graphics Driver DDX Layer SGI
Sound Drivers 4Front Technology
TCX MySQL Database TCX
TriTeal CDE Desk Top TriTeal
Various Open Source utilities and commands such as perl and shell utilities, lynx and gzip code. Open Source
Veritas File System Veritas
Veritas Volume Manager Veritas
The sale also includes billing records, correspondence, "data (only to the extent that such data that contains personally identifiable information that may be lawfully transferred)", internal documentation, and "files relating to the Acquired Assets (only to the extent that any such materials or files exist)" but excluding things like seller's minute books, membership interest books and related organizational documents and also excluding "Seller's files, books and records relating to the Excluded Assets or to Seller's Obligations not included in the Assumed Obligations".

Love the part about only to the extent that they exist.

Here's what you don't get, the excluded assets:

(i) all rights of Seller under this Agreement and all agreements contemplated hereby;

(ii) all of Seller’s rights and obligations with respect to the SVRX Licenses (as defined in the Santa Cruz-Novell APA);

(iii) SCO Japan, Ltd., a Japanese corporation, and SCO Canada Company, a Canadian corporation;

(iv) (a) cash and cash equivalents and marketable securities (including cash in transit and cash and marketable securities in lock boxes or on deposit with or otherwise held by any financial institution); (b) accounts receivable (including accounts receivable for services rendered through the Closing Date with respect to which invoices are mailed after the Closing Date) and other trade receivables; and (c) all prepaid premiums and other prepayments and deposits with respect to the Company’s Employee Benefit Plans (if any), the Company’s insurance policies, and any other Contracts not purchased by Buyer;

(v) all rights of Seller in the Licensed Properties; and

(vi) all of Seller’s claims, causes of action and other legal or equitable rights and remedies (A) against Buyer with respect to the transactions contemplated by this Agreement and (B) relating to all rights and interests in all litigation claims pending or that may be asserted in the future, against International Business Machines Corporation, Novell, Inc., SUSE Linux GmbH or others, and (C) relating to every claim of any nature whatsoever, known or unknown that has been or may be asserted against RedHat, Inc. or others relating to or arising from all licensing, covenant not to sue rights, releases or other claims relating to any allegations that Linux violates SCO’s Unix or UnixWare intellectual property, contract or other rights.

The list of assets being licensed by third parties includes GPL'd code, like lynx, assuming they mean the browser. If so, they can't transfer it under the terms that the documents assert that they intend to, I don't think, because Exhibit C, the License Agreement, states that you don't get sublicensing rights:
1.1 Licensor grants to Licensee a personal, nontransferable (EXCEPT AS PROVIDED IN Section 9), nonexclusive, non-sublicensable (except as provided herein), royalty free right and license to use the Licensed Properties in accordance with this Agreement, including the right to modify and create derivative works of such Licensed Properties.

1.2 Licensee shall not have the right to, and agrees that it shall not, license, distribute or otherwise provide, disclose or transfer the Licensed Properties, in whole or in part, to any third party except as provided below in this Section 1. Licensee shall maintain the Licensed Properties in strict confidence in accordance with the confidentiality provisions of this Agreement.

Section 9 just says you can sell this business on to another buyer. And none of the above can be done to GPL code. Anyway, with GPL code, you get your license from the original licensor, not any middle men, even if you get the code from a middle man. And if it's modified by the middle man, GPLv2 requires this, as explained in the FAQ:
GPLv2 says that modified versions, if released, must be “licensed … to all third parties.” Who are these third parties?

Section 2 says that modified versions you distribute must be licensed to all third parties under the GPL. “All third parties” means absolutely everyone—but this does not require you to *do* anything physically for them. It only means they have a license from you, under the GPL, for your version.

So you couldn't require that the code be nonsublicensable or that it must be kept confidential, etc., as per SCO's draft. Note this section of the GPLv2:
6. Each time you redistribute the Program (or any work based on the Program), the recipient automatically receives a license from the original licensor to copy, distribute or modify the Program subject to these terms and conditions. You may not impose any further restrictions on the recipients' exercise of the rights granted herein. You are not responsible for enforcing compliance by third parties to this License.
But then SCO never did grok the GPL. If they'd understood it, they wouldn't have tried SCOsource, which conflicts with the GPL, as IBM will point out in a court of law, if and when it gets the opportunity at trial, because its counterclaims include some tied to SCOsource.

  


Want to Buy SCO's Software Business? | 142 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections Thread
Authored by: artp on Monday, August 09 2010 @ 11:03 PM EDT
Title block should be changed to: "Eror -> Error"
Opinions and disagreements go elsewhere.


---
Userfriendly on WGA server outage:
When you're chained to an oar you don't think you should go down when the galley
sinks ?

[ Reply to This | # ]

Off Topic Thread
Authored by: artp on Monday, August 09 2010 @ 11:13 PM EDT
Don't got here if it relates to tSCOg's software business.

Which ought to leave the field wide open, eh ? Questions as to whether tSCOg HAS
a software business, are, unfortunately, ON topic!


---
Userfriendly on WGA server outage:
When you're chained to an oar you don't think you should go down when the galley
sinks ?

[ Reply to This | # ]

News Picks thread
Authored by: artp on Monday, August 09 2010 @ 11:16 PM EDT
URL, please ?

Don't forget to change the Title Block. I have some very strong opinions on
"News Picks" which I am not afraid to share. :-)

---
Userfriendly on WGA server outage:
When you're chained to an oar you don't think you should go down when the galley
sinks ?

[ Reply to This | # ]

Useless?
Authored by: sk43 on Monday, August 09 2010 @ 11:20 PM EDT
One of SCO's finest products is included in the Acquired Assets:

SCO UnixWare 7 LKP

That's the Linux Kernel Personality. Unfortunately, it
won't work without CD #4 - the specially modified version of OpenServer 3.1
designed to work with LKP:

http://www.sco.com/support/docs/unixware/uw714latenews/714latenews.html

"The Linux RPM CD #4 has been removed from the UnixWare 7.1.4 Media Kit.
The Linux Kernel Personality (LKP) should not be selected from UnixWare 7.1.4
Updates CD #2 during either a fresh or upgrade installation of UnixWare
7.1.4."

A missing CD #4 would be a deal-breaker. Where is it listed in the Acquired
Assets?

[ Reply to This | # ]

  • Useless? - Authored by: bstone on Tuesday, August 10 2010 @ 07:12 AM EDT
Comes v MS Goes Here
Authored by: artp on Monday, August 09 2010 @ 11:20 PM EDT

Check for work to be done yet by visiting the Groklaw Comes page.

I don't know who started the "Comes Goes Here" threads, but it sure fits my warped sense of humor.

---
Userfriendly on WGA server outage:
When you're chained to an oar you don't think you should go down when the galley sinks ?

[ Reply to This | # ]

Marketing material
Authored by: Anonymous on Monday, August 09 2010 @ 11:24 PM EDT
Do you think we'll get to see this marketing material they talk about?
Presumably it will contain details of how much money the business is making,
which would be interesting to see (the MORs give some very vague numbers, but
they aren't much use).

[ Reply to This | # ]

I don't think this belongs here
Authored by: artp on Monday, August 09 2010 @ 11:33 PM EDT
I don't think this belongs here:

Various Open Source utilities and commands such as perl and shell utilities,
lynx and gzip code. Open Source

The reason I say that is because they don't have a license that is granted
specifically to them from the owner, they have a General license that is granted
en masse to whoever want to use it.

You can't SELL GPL or BSD code if it doesn't belong to you, and IO doubt that
you can SELL your license to it.

But it won't be the first time a cluebat has been necessary with tSCOg.

---
Userfriendly on WGA server outage:
When you're chained to an oar you don't think you should go down when the galley
sinks ?

[ Reply to This | # ]

This APA needs an amendment
Authored by: Anonymous on Monday, August 09 2010 @ 11:41 PM EDT
What if, at some future time, the purchaser decides that they need something not
transferred by this APA?

Clearly, there needs to be an amendment allowing the buyer to take over, on
demand, any asset needed for the operation of the business... :)

[ Reply to This | # ]

Want to Buy SCO's Software Business?
Authored by: symbolset on Monday, August 09 2010 @ 11:51 PM EDT
I wonder if Stephen Norris is still out there, circling.

[ Reply to This | # ]

Money scenario
Authored by: _Arthur on Tuesday, August 10 2010 @ 12:00 AM EDT
Let's try it with ballpark dollars.

Let's suppose SCO sells Unixware+Openserver for $3.5M.

What happens with the $$money ?

-$150K for OPA's cut
-$2.3M for Yarro's superpriority's loan
-$200K for SCO's back taxes, accountants, penalties
-$750K for Blank Rome and OPA
-$200K for other post-petition liabilities SCO forgot to include in its MORs

The remainder, if any, is to go to
-Novell (coverted/stolen money)
-Other creditors

And then, any stray dollar might go to SCO new Litigation business,
against mostly IBM.

And if IBM prevails on its counterclaims, IBM can only get an empty,
asset-less shell.
Not a bad strategy after all.

[ Reply to This | # ]

Want to Buy SCO's Software Business?
Authored by: WhiteFang on Tuesday, August 10 2010 @ 12:11 AM EDT
It was my understanding that the only way to get out of Chapter 11 bankruptcy
was to either convert to Chapter 7 or get a business plan approved.

This looks like their selling assets in order to continue litigation to me. i.e.
Selling all assets except right to litigate. Yes? No?

Could someone explain what I'm missing here?

---
"The so-called protection offered by DRM operates only at the
distribution end of the chain. It doesn't help artists eat better." Anonymous

[ Reply to This | # ]

No rights to sue anyone related to the business
Authored by: Anonymous on Tuesday, August 10 2010 @ 12:16 AM EDT

It would seem the buyer has no rights to sue anyone at all. Firstly, the warranty disclaimer makes it pretty clear you can't go after SCO and SCOfolk. Secondly, there are the clauses that exclude from the sale:

... all of Seller’s claims, causes of action and other legal or equitable rights and remedies ... (B) relating to all rights and interests in all litigation claims pending or that may be asserted in the future, against International Business Machines Corporation, Novell, Inc., SUSE Linux GmbH or others...

This leaves the buyer with no ability to sue concerning the business and products they are purchasing. Such a purchase makes sense only for parties that are so close to SCO senior management as to be able to strike behind-closed-doors agreements with them.

[ Reply to This | # ]

Want to Buy SCO's Software Business?
Authored by: WhiteFang on Tuesday, August 10 2010 @ 12:17 AM EDT
And further - doesn't Novell have the right to sue to get all the assets back
due to tSCGs multiple breaches of contract?

i.e. Conversion of Novell's money. Not waiving tSCOgs suits against IBM, Sequent
etc when so ordered by Novell. Entering into new licences when tSCOg plainly did
not have the right to do so.

Any potential buyer of tSCOg assets needs to know there is a real risk any
purchased assets may end up being awarded by the court to Novell.

Is there something else I'm missing here?

---
"The so-called protection offered by DRM operates only at the
distribution end of the chain. It doesn't help artists eat better." Anonymous

[ Reply to This | # ]

Umm Copyright violations
Authored by: Anonymous on Tuesday, August 10 2010 @ 12:22 AM EDT
SCO cannot sell OpenServer/UnixWare or whatever they want to call it free and
clear of IBM and Novell copyrights.

IBM and Novell can spend 15 minutes with the code and come up with a list of
comparisons equivalent to that SCO claimed against IBM. For the bankruptcy court
to grant free and clear title to the OpenServer/UnixWare would be unfair to
Novell owner of the SYSV copyrights and IBM who worked on code development with
Santa Cruz.

Also SCO has presented its leverage copyright claim against IBM. If it ever say
SYSV then it must be SYSV. The IBM case is still open so SCO cannot argue
against that line of copyright derivation.

Clearly OpenServer/UnixWare are entangled with Novell and IBM copyright code.
SCO must present its version control system for all the code and clear up any
claims from Novell and IBM before being allowed to continue with the sale.

Again, it would be terribly unfair for the bankruptcy court to damage Novell and
IBM by granting clear title to any copyright they own that may exist in
OpenServer/Unixware through sale in the bankruptcy court.

Either the sale must be conditional on Novell and IBM having yet to be
determined claims on the code base or any claims Novell and IBM have must be
resolved before the sale can proceed.

That should tie it into a nice mess.

[ Reply to This | # ]

tax returns for *2008*
Authored by: Yossarian on Tuesday, August 10 2010 @ 12:44 AM EDT
Even though it is illegal not to file tax returns, the IRS
usually leaves you alone if all you have is loses.
*But*, what about SEC?

All companies that are publicly traded have to follow SCO
rules about accounting and auditing, so investors would have
some idea what king of pig they buy in the poke. And taxes are
a part of normal audit. So who is responsible for missing the
tax deadline and how can he be, legally, punished for that?

[ Reply to This | # ]

Would you buy a Used Adobe Flash Player from This Man? n/t
Authored by: Anonymous on Tuesday, August 10 2010 @ 12:44 AM EDT

[ Reply to This | # ]

I bid $1
Authored by: Anonymous on Tuesday, August 10 2010 @ 12:51 AM EDT
Under those conditions, the "assets" are essentially worthless. But
there doesn't seem to be (another) downside, so I'll take the risk. Maybe I can
double my money!

[ Reply to This | # ]

ready "to roll" or "to be rolled"?
Authored by: David Dudek on Tuesday, August 10 2010 @ 01:24 AM EDT
Is that "Whoever it is, he or she is ready to roll" or "Whoever
it is, he or she is ready to be rolled"

---
David Dudek

[ Reply to This | # ]

I thought SCO said this was impossible?
Authored by: mobrien_12 on Tuesday, August 10 2010 @ 01:43 AM EDT
After all,didn't they say you can't buy a software business without the
copyrights? Are they still not saying this in their appeal?

[ Reply to This | # ]

What is the right to litigate exactly?
Authored by: kh on Tuesday, August 10 2010 @ 02:07 AM EDT
If they sell the business to someone else how can they retain the right to
litigate? What are they really selling? Just the business process of skimming
5% royalties before paying Novell?

How can they retain the right to litigate? What does it actually mean?

[ Reply to This | # ]

This is not a fire sale.
Authored by: Ian Al on Tuesday, August 10 2010 @ 03:10 AM EDT
I think it was Spector that told the court during the eighth, tenth or was it
the fourteenth sale attempt 'You can't sell the property while it is in flames.
You have to put the fire out, first.'.

So, what is for sale? The property is so unstable that it has to be sold, in
situ. The due diligence room is in another building so the property is probably
completely unsafe. The seller is unable to guarantee what is for sale, so it
seems likely that some of it was consumed in the flames. We know that anything
that was mobile was removed and sold off.

What about all those SVrX manuals, copyrights and the source code repositories
for SVrX necessary to develop the merged product? Don't forget that the court
was told that there was significant SVrX code in Unixware so the code is an
essential part to take the product forward and provide paid-for support to the
new customers. What about knowledgeable engineering and sales staff? It sounds
like a bit of an ask to run the business when they have all gone.

So, what are the sale items good for? They cannot be run as a business because
all the support has gone. They cannot be the basis for litigation because the
copyrights and rights to litigate are not included and the property is sold, 'as
seen'. Goodwill... forget I mentioned that. Existing customer base: the revenue
stream from the SVrX contracts goes to Novell and the Unixware and Openserver
customers will soon be gone because of failure to honour the support contracts.
What about all those valuable European subsidiaries? The ones that Blank Rome
staffers travelled in style to have a look at. Surely, they were not consumed in
the conflagration. Don't tell me they all turned out to be empty shells just
used for the SCOG accounting shell game... I said, don't tell me that!

It seems that the answer to 'what are the items for sale good for?' is 'even
less than SCOG is good for. At least they can fail litigation 101.'.

---
Regards
Ian Al
SCOG, what ever happened to them? Whatever, it was less than they deserve.

[ Reply to This | # ]

no rehab?
Authored by: Anonymous on Tuesday, August 10 2010 @ 03:40 AM EDT
if this sale occurs there is nothing but litigation. can it be argued, therefore
time to go 7?

[ Reply to This | # ]

Want to Buy SCO's Software Business?
Authored by: ionic on Tuesday, August 10 2010 @ 05:52 AM EDT
I wonder if this is a move to force Novell / IBM's hand in the bankruptcy
court?

They both appear to have been silent there lately, choosing not to object to
filings that perhaps one would have expected them to disagree with. I suspect
that this is to avoid the appearance of "big nasty Novell / IBM"
pushing the small, innocent SCO into Chapter 7.

If this sale attempt is, as it appears, a ruse to remove assets from the reach
of the creditors and more importantly to deprive Novell (and IBM?) of some of
their IP, then either Novell or IBM may be forced to petition in a strong manner
to prevent this. Cue screams from SCO of "Boo Hoo, the nasty Big Company
has stopped us from being able to recover"

[ Reply to This | # ]

I guess they're looking for a fool...
Authored by: rsmith on Tuesday, August 10 2010 @ 05:56 AM EDT

Because only a fool would buy this dying if not dead business. What is there available in UnixWare or OpenServer that is not to be found in open source operating systems? Who can think of anything worthwhile?

Why would anyone with a working brain want to sink money into this?

My guess is that the trustee has looked at the business in isolation, but not at the operating system market landscape. Maybe he lacks the people with sufficient knowledge to tell him that this is not a winning proposition.

---
Intellectual Property is an oxymoron.

[ Reply to This | # ]

Japan and Canada
Authored by: Anonymous on Tuesday, August 10 2010 @ 06:45 AM EDT
interesting choices.

[ Reply to This | # ]

Want to Buy SCO's Software Business?
Authored by: JamesK on Tuesday, August 10 2010 @ 07:43 AM EDT
Let me take my empties back and I'll see what I can do. ;-)


---
IANALAIDPOOTV

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

[ Reply to This | # ]

Cahn & Gross incompetence
Authored by: Gringo on Tuesday, August 10 2010 @ 09:26 AM EDT

At the time Cahn was appointed Chapter 11 Administrator, there was still some value in SCO's business. They had just launched a new Unix virtualization product, they had customers, sales reps and engineers, and they had staff on hand that could ensure a hand over that would provide some continuity to the business. The value of this business probably amounted to several millions of dollars - perhaps especially to Novel or IBM.

Cahn should have conceded the litigation and done the investigations into the former debtors in possession as well as BS&F to see if money could be recovered, audit the books, then began Chapter 7. There was no need to continue the Novel suite since that would have been conceded. (That would have "put the fire out" immediately) At least then there would be some restitution for the creditors, perhaps principally Novell & IBM, and therefore some justice done. Existing SCO clients would as well have been spared much pain and anxiety. (Didn't some of these send letters stating how important continuance of the Unix business was to them?)

As it happened, in just one year Cahn has destroyed all value in the company. These assets are now worthless without the aforementioned customers, sales reps, engineers, and staff on hand that could ensure a handover that would provide some continuity to the business. Judge Gross, who is ultimately responsible for the case, just stood idly by well Cahn destroyed all the value in SCO's assets.

Nice work - Cahn. Well done, Judge Gross! I guess these people have lived up to their names.

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does not make sense ...
Authored by: nsomos on Tuesday, August 10 2010 @ 10:24 AM EDT
I've been arguing that Cahn should sell non-exclusive,
non-transferable source licenses (note PLURAL), so that
existing customers (plural) have a way forward. He may
not have understood that these would be sold to as many
customers as were willing to buy them.

But if you are selling as a business, it does not make
sense to be non-sublicensable and just a right to use.

1.1 Licensor grants to Licensee a personal, nontransferable (EXCEPT AS PROVIDED IN Section 9), nonexclusive, non-sublicensable (except as provided herein), royalty free right and license to use the Licensed Properties in accordance with this Agreement, including the right to modify and create derivative works of such Licensed Properties.
So if it is a business, and to only ONE buyer, then
they should be able to sub-license and resell and so on.
If they can't do that, it isn't useful to a business.

So this does not make sense to me. Then again much of
what SCOG does, does not make sense.

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Can Lynx Object to the sale?
Authored by: tinkerghost on Tuesday, August 10 2010 @ 10:40 AM EDT
Because it would be a violation of their copyright & license, do the
copyright holders for Lynx have standing to file an objection to the proposed
sale?

---
You patented WHAT?!?!?!

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Want to Buy SCO's Software Business?
Authored by: Anonymous on Tuesday, August 10 2010 @ 11:17 AM EDT
<blockquote>You also don't get "Seller’s rights and obligations with
respect to the SVRX Licenses (as defined in the Santa Cruz-Novell APA)".
So... you buy the business, but SCO then contacts all your customers every month
or so to collect money for Novell?</blockquote>

The licenses being referred to are the pre-APA licenses with the various
companies that took out licenses with AT&T and/or Novell to create their own
flavor of UNIX.

I don't think that Novell owns any of the licenses that SCO has with their true
customers, which are the end users of UnixWare and OpenServer, like McDonalds.
The purchaser of this UNIX software business will still be to sell copies of the
latest versions of those 2 products, along with being able to develop and sell
new versions. Hey, maybe they'll finally develop the merged product.

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Included vs. Excluded assets
Authored by: DannyB on Tuesday, August 10 2010 @ 01:34 PM EDT
SCO has demonstrated an inability to distinguish between Included Assets and
Excluded assets. That is an inability to distinguish between mine and thine.

Why would anyone want to even think of getting near this?

SCO has destroyed everything it has touched. It could prove unhelpful to the
careers of a bankruptcy judge and an appointed trustee.

An early investor in the scam backed away years ago. Microsoft distanced
themselves. A customer who bought a SCOsource license ended up regretting it.
Someone who was forcibly "given" a SCOsource license bundled with
something else publicly disclaimed that they didn't want it.


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The price of freedom is eternal litigation.

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Why a new accounting firm?
Authored by: Anonymous on Tuesday, August 10 2010 @ 03:09 PM EDT
Why not use the outside accounting firm for doing the taxes that they have been
using for other accounting duties? If I recall, it was Tanner, LLC.

They already applied for and got approval back in 2008, and again in 2009, for
Tanner to expand their role to doing the taxes for each prior year. See docket
numbers 311, 330, 645 & 671 in the bankruptcy timeline.

Why are they hiring a new accounting firm to come in and do the taxes now?
Should they ask tanner for their money back?

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Want to Buy SCO's Software Business?
Authored by: Anonymous on Wednesday, August 11 2010 @ 05:07 AM EDT
did they ever sell their Caldera OpenLinux assets?

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SCO contacting customers - Want to Buy SCO's Software Business?
Authored by: Anonymous on Thursday, August 12 2010 @ 05:10 AM EDT
"...but SCO then contacts all your customers every month or so to collect
money for Novell?"

I don't understand. Back when this all began, Darl complained in a letter to
Novell that the five percent wasn't enough to cover the cost of making the
collections. If it was losing money in 2003, how can it possibly not be losing
money now, and if so why would they want to continue with that piece of the
business.

The only way I can see that it would make any sense is if they held on to the
money for a really long time, investing it in some kind of high yield fund,
before turning it over to Novell.

A really, really, really long time.

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