decoration decoration
Stories

GROKLAW
When you want to know more...
decoration
For layout only
Home
Archives
Site Map
Search
About Groklaw
Awards
Legal Research
Timelines
ApplevSamsung
ApplevSamsung p.2
ArchiveExplorer
Autozone
Bilski
Cases
Cast: Lawyers
Comes v. MS
Contracts/Documents
Courts
DRM
Gordon v MS
GPL
Grokdoc
HTML How To
IPI v RH
IV v. Google
Legal Docs
Lodsys
MS Litigations
MSvB&N
News Picks
Novell v. MS
Novell-MS Deal
ODF/OOXML
OOXML Appeals
OraclevGoogle
Patents
ProjectMonterey
Psystar
Quote Database
Red Hat v SCO
Salus Book
SCEA v Hotz
SCO Appeals
SCO Bankruptcy
SCO Financials
SCO Overview
SCO v IBM
SCO v Novell
SCO:Soup2Nuts
SCOsource
Sean Daly
Software Patents
Switch to Linux
Transcripts
Unix Books
Your contributions keep Groklaw going.
To donate to Groklaw 2.0:

Groklaw Gear

Click here to send an email to the editor of this weblog.


Contact PJ

Click here to email PJ. You won't find me on Facebook Donate Paypal


User Functions

Username:

Password:

Don't have an account yet? Sign up as a New User

No Legal Advice

The information on Groklaw is not intended to constitute legal advice. While Mark is a lawyer and he has asked other lawyers and law students to contribute articles, all of these articles are offered to help educate, not to provide specific legal advice. They are not your lawyers.

Here's Groklaw's comments policy.


What's New

STORIES
No new stories

COMMENTS last 48 hrs
No new comments


Sponsors

Hosting:
hosted by ibiblio

On servers donated to ibiblio by AMD.

Webmaster
Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium - Updated
Monday, November 22 2010 @ 01:33 PM EST

Novell has sold itself to Attachmate Corporation. There is a side deal selling "certain intellectual property assets" to CPTN Holdings LLC, "a consortium of technology companies organized by Microsoft". SUSE goes to Attachmate, I gather, and will be a separate unit, so what goes to Microsoft's consortium?

No doubt we'll find out in time. It is being reported that what it will get is 882 patents. Blech. How many does Novell own? Is that all of them? If so, will we get to watch Son of SCO, but with patents this time? But keep in mind that the WordPerfect litigation could be in this picture, and I wonder if this could be a kind of deal to tactfully settle it out, with Microsoft paying to end it this way? $450 million isn't a lot, though, so how could it be all of the patents? Nevertheless, selling any patents to Microsoft is like selling your baby to a pedophile in the limited sense that you can reasonably predict what it will do with the acquisition.

Novell's CEO is telling "valued customers" in an email that it's a merger agreement, that Novell believes "the transaction is great news for our customers," that all contracts will be honored, and that the IP sale to Linux's sworn enemy "will not impact customers", whatever that means. Not a word about Linux and what it means for SUSE. Not a word to reassure the community. ComputerWorld's Chris Kanaracus has the interesting detail that Elliott Management, the group Novell rejected earlier, will become a shareholder in Attachmate:

Attachmate's offer of $6.10 per share follows the $5.75 a share offer made in March by investment firm Elliott Management Corporation, one of Novell's largest shareholders. Novell rejected that offer. But as part of the deal announced Monday, Elliott is to become an equity shareholder in Attachmate, according to a statement.
So. The vultures won, I gather. Here is the Attachmate statement, so you can decide for yourself. But here's a word from Elliott in that statement:
“Elliott is pleased to have been a major catalyst in this transaction, enabling Novell’s shareholders to realize substantial shareholder value,” said Jesse A. Cohn, portfolio manager at Elliott Management. “Novell has a robust product set that we believe will create a significant value opportunity as part of the Attachmate Corporation portfolio of products.”
A major catalyst. Significant value opportunity. Get the picture?

Here's what Ron Hovsepian is telling Novell's "valued customers" by email:
Dear Valued Novell Customer,

I am writing to let you know that today we announced that Novell has entered into a definitive merger agreement under which Attachmate Corporation would acquire Novell for $6.10 per share in cash in a transaction valued at approximately $2.2 billion.

We believe this transaction is great news for our customers. Novell has a long history of innovation and market leadership, and this tradition will be preserved and built upon through this transaction. We place tremendous value on the relationships we’ve cultivated with our customers and I can assure you that providing you with the innovative products, solutions and support you’ve come to rely on remains a top priority.

We can also assure you that the planned transaction with Attachmate Corporation does not alter our obligations to honor all contractual commitments. This includes maintenance and technical support for our products. We continue to execute aggressively on our product development efforts and are committed to providing exceptional service and being easy to do business with.

Novell also announced the sale of certain intellectual property assets to CPTN Holdings LLC. The sale of certain intellectual property assets will not impact customers. Customers will continue to be authorized to use Novell products under this intellectual property.

Attachmate Corporation plans to retain both the Novell and SUSE brands and operate them as two separate business units, along with its other holdings, Attachmate and NetIQ. The transaction with Attachmate Corporation and the sale of certain intellectual property assets to CPTN Holdings LLC are currently expected to close in the first quarter of 2011.

Until the merger transaction closes, it is business as usual. We have no plans to change your current sales coverage or ordering practices. If you have any questions or wish to discuss this matter further, please feel free to contact your local sales leadership.

I want to thank you personally for your ongoing business and express my deep appreciation for the trust and confidence you have placed in Novell over the last year. We hope you share our enthusiasm about Novell’s exciting future.

Sincerely,

Ron Hovsepian

Forward-Looking STATEMENTS

This communication contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations and beliefs of Novell and are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those described in the forward-looking statements. Many of these risks are beyond our control or ability to predict. Important factors that could cause actual results to differ from those set forth in the forward-looking statements include, but are not limited to, the risk that the proposed sale of certain intellectual property assets and the proposed merger may not be consummated in a timely manner, if at all; the risk that various closing conditions will not be satisfied or waived, including the risk that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the transactions; and other risks and uncertainties discussed in Novell’s filings with the Securities and Exchange Commission. You should not rely upon forward-looking statements as predictions of future events. Novell expressly disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein.

ADDITIONAL INFORMATION ABOUT THE MERGER AND WHERE TO FIND IT

In connection with the proposed merger, Novell intends to file relevant materials with the SEC, including a proxy statement. Investors and security holders of Novell are urged to read these documents (if and when they become available) and any other relevant documents filed with the SEC because they will contain important information about Novell, the proposed sale of certain intellectual property assets, the proposed merger and the parties to these proposed transactions. Investors and security holders may obtain these documents free of charge at the SEC’s website at http://www.sec.gov. In addition, the documents filed with the SEC by Novell may be obtained free of charge by directing such request to: Novell Investor Relations at 1-800-317-3195 or from the investor relations website portion of Novell's website.

Novell and its directors and executive officers may be deemed to be participants in the solicitation of proxies from Novell’s stockholders in respect of the proposed merger. Information regarding Novell’s directors and executive officers is contained in Novell’s Annual Report on Form 10-K for the fiscal year ended October 31, 2009, its proxy statement for its 2010 Annual Meeting of Stockholders, dated February 26, 2010, and subsequent filings which Novell has made with the SEC. Stockholders may obtain additional information about the directors and executive officers of Novell and their respective interests with respect to the proposed merger by reading the definitive proxy statement and other relevant documents regarding the proposed merger, when filed with the SEC.

Well, I told you in 2006 that Novell had sold out, did I not? The Microsoft patent deal was a big hint. The sale to the Microsoft consortium could be about that too, actually.

I hope you will be careful never to sign over your copyrights to any commercial vendor where the wording allows the vendor to change the license any way it pleases. Sometimes what pleases it most is to get a huge basket of money.

The full press release:

Novell, Inc. (NASDAQ: NOVL), the leader in intelligent workload management, today announced that it has entered into a definitive merger agreement under which Attachmate Corporation would acquire Novell for $6.10 per share in cash in a transaction valued at approximately $2.2 billion. Attachmate Corporation is owned by an investment group led by Francisco Partners, Golden Gate Capital and Thoma Bravo. Novell also announced it has entered into a definitive agreement for the concurrent sale of certain intellectual property assets to CPTN Holdings LLC, a consortium of technology companies organized by Microsoft Corporation, for $450 million in cash, which cash payment is reflected in the merger consideration to be paid by Attachmate Corporation.

The $6.10 per share consideration represents a premium of 28% to Novell's closing share price on March 2, 2010, the last trading day prior to the public disclosure of Elliott Associates, L.P.'s proposal to acquire all of the outstanding shares of Novell for $5.75 per share and a 9% premium to Novell's closing stock price on November 19, 2010.

"After a thorough review of a broad range of alternatives to enhance stockholder value, our Board of Directors concluded that the best available alternative was the combination of a merger with Attachmate Corporation and a sale of certain intellectual property assets to the consortium," said Ron Hovsepian, president and CEO of Novell. "We are pleased that these transactions appropriately recognize the value of Novell's relationships, technology and solutions, while providing our stockholders with an attractive cash premium for their investment."

Mr. Hovsepian continued, "We also believe the transaction with Attachmate Corporation will deliver important benefits to Novell's customers, partners and employees by providing opportunities for building on Novell's brands, innovation and market leadership."

"We are very excited about this transaction as it greatly complements our existing portfolio," said Jeff Hawn, chairman and CEO of Attachmate Corporation. "Novell has an established record of innovation, impressive technology and brand assets, and a leading ecosystem of partnerships and talented employees. The addition of Novell to our Attachmate and NetIQ businesses will enhance the spectrum of solutions we can offer to customers. We fully support Novell's commitment to its customers and we look forward to continuing to invest for the benefit of Novell's customers and partners."

Attachmate Corporation plans to operate Novell as two business units: Novell and SUSE; and will join them with its other holdings, Attachmate and NetIQ.

Attachmate Corporation's acquisition of Novell is subject to customary closing conditions, including regulatory approvals and clearance under the Hart-Scott-Rodino Act, and is also conditioned upon the closing of the proposed sale of certain intellectual property assets to CPTN Holdings LLC. In addition, the transaction is subject to approval by Novell's stockholders. The sale of the intellectual property assets to the consortium is subject to customary closing conditions, including regulatory approvals and clearance under the Hart-Scott-Rodino Act, and is also conditioned upon the closing of the merger with Attachmate Corporation. Novell currently expects these transactions to close in the first quarter of 2011. J.P. Morgan is serving as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor to Novell. Credit Suisse and RBC Capital Markets are serving as financial advisors and Jones Day is acting as legal advisor to Attachmate Corporation.

About Attachmate Corporation

Attachmate Corporation, owned by an investment group led by Francisco Partners, Golden Gate Capital and Thoma Bravo, enables IT organizations to extend mission critical services and assures they are managed, secure and compliant. Principal holdings include Attachmate (www.attachmate.com) and NetIQ (www.netiq.com).

About Novell

Novell, Inc. (Nasdaq: NOVL), a leader in Intelligent Workload Management, helps organizations securely deliver and manage computing services across physical, virtual and cloud computing environments. We help customers reduce the cost, complexity, and risk associated with their IT systems through our solutions for identity and security, systems management, collaboration and Linux based operating platforms. With our infrastructure software and ecosystem of partnerships, Novell integrates mixed IT environments, allowing people and technology to work as one. For more information, visit www.novell.com.

Some media reaction:
  • The Register: Attachmate is a conglomerate of legacy software suppliers who create tools for accessing, modernizing, and securing applications that reach back into proprietary IBM minicomputers and mainframes, now known as Power Systems running the IBM i operating system (what used to be called AS/400, iSeries, or System i platforms) or System zEnterprise. Those three companies are WRQ, Attachmate, and NetIQ....The three private equity companies that control Attachmate run their combined businesses as Attachmate (for host access and application modernization) and NetIQ (for systems management and security). In the statement, Jeff Hawn, Attachmate's CEO and chairman, said that it would operate Novell as two business units: one for the SUSE Linux stack and another for all of the other Novell bits. Over time, it stands to reason that NetIQ and portions of Novell dealing with access control and workload management will be merged.

    Novell shareholders have to wait to see exactly what Attachmate is selling off to Microsoft and then ponder the deal. Wouldn't it be funny if Microsoft ended up owning whatever rights to Unix that Novell thinks it has?

  • ZDNet: What is CPTN Holdings LCC and what kind of patents did it acquire? Mary Jo Foley has highlighted the Microsoft connection in the Novell sale to Attachmate. CPTN is a Microsoft-backed consortium. Here’s what we know: Attachmate will sell 882 patents for $450 million in cash to CPTN. Here’s what we don’t know: Any history about CPTN. There are no court documents—odd for an intellectual property consortium—and SEC filings turn up dry before today. It almost looks as CPTN was created just a few days ago. Also unknown: Other companies in this consortium.

  • WSJ:Attachmate Chief Executive Jeff Hawn said in an interview that the firm plans to run Novell as a private company, at least in the near term.

    "The rationale for the deal is it lets us do a lot more for our customers," Hawn said. He said Novell, Attachmate and NetIQ--which Attachmate took private in 2006--share many customers, and the companies' identity and security businesses are complementary. In addition, Attachmate plans to further strengthen Novell's Linux business, Hawn said.

    Novell President and Chief Executive Ron Hovsepian said in an interview that it hasn't yet been determined if current Novell management will stay with the company, but management will work on the transition at least through the deal closing.

  • BusinessWeek: Private-equity firms pool money from investors to take over companies, financing the purchases mostly with debt, with the intention of selling them later for a profit.

  • Steven J. Vaughan-Nichols, ComputerWorld: While none of the parties to this deal have talked to me, sources close to the buyout tell me Attachmate and Microsoft partnered up to make the acquisition sweet enough for Novell's board. ...

    At this time, we don't know exactly what Microsoft has bought. We do know that Microsoft's goal of making sure Novell didn't end up in VMware's hands has been achieved. It's also likely that Novell's long-running WordPerfect lawsuit against Microsoft is now dead. And Microsoft may have gained intellectual property rights that it believes could be used against Linux vendors that don't partner with Microsoft.

  • Stephen Shankland, CNET: According to a regulatory filing, CPTN will get 882 Novell patents: "Also on November 21, 2010, Novell entered into a Patent Purchase Agreement...with CPTN Holdings LLC, a Delaware limited liability company and consortium of technology companies organized by Microsoft Corporation. The Patent Purchase Agreement provides that, upon the terms and subject to the conditions set forth in the Patent Purchase Agreement, Novell will sell to CPTN all of Novell's right, title and interest in 882 patents...for $450 million in cash."...

    There are many possible Novell IP assets Microsoft might be interested in--Unix copyrights that figured centrally in Novell's Linux-related fight against the SCO Group, for example.

    Microsoft isn't saying.

    "We are pleased to be a part of the acquisition of certain intellectual property assets of Novell. Microsoft looks forward to continuing our collaboration with Novell into the future, to bring mixed-source IT solutions to customers," said Horacio Gutierrez, Microsoft's corporate vice president and deputy general counsel of intellectual property and licensing, in a statement. The company declined to comment further.

    If that statement is a hint, that could indicate the intellectual property could be involved in the 2006 partnership between Novell and Microsoft. Under that partnership, Novell agreed among other things to adapt Suse Linux to run well on Microsoft's Hyper-V virtualization software, which lets multiple operating systems run on the same server simultaneously. Microsoft and Novell delivered the software in 2008 that would let SLES run well virtualized on Microsoft's technology.

  • TechFlash: Novell says in its news release that the $450 million cash payment from the Microsoft group is "reflected in the merger consideration" paid by Attachmate, suggesting that Microsoft's role was key to the broader deal....

    Novell currently has 3,450 employees, while Attachmate employs 925 (including 350 in the Seattle area). A spokeswoman for Attachmate said that the company will operate four business units after the deal closes: Attachmate, NetIQ, Novell and SUSE. She added that the goal is to "do no harm" to the business units that Attachmate integrates.

  • Barron's: I was joined this afternoon by the CEOs of Attachmate and Novell (NOVL) to discuss the acquisition of Novell by Attachmate for $2.2 billion, announced this morning.

    On whether this was the best deal to do, Ron Hovsepian, Novell’s president and CEO, said, “I think the board made their decision as to what would create the best shareholder value at this time. They reviewed all the alternatives, and in their opinion, this is what they concluded was the best value for shareholders.”...

    Hovsepian says that SUSE has 80% share of IBM (IBM) mainframe computers based on the “Z” chip that use Linux, as one example of overlap between the companies’ markets.

Does this mean IBM is in the background trying to make sure things are not too bad? I have no idea. But separating out SUSE means it could later get sold off to someone else. Sad when that seems like the best possible thing to hope for.

But I expect that the recent attempts to ramp up the usual anti-Groklaw smear campaign by those who seems to have an attachment to Microsoft could be related to this news. I was wondering why.

From Novell's 8K:

Patent Purchase Agreement

Also on November 21, 2010, Novell entered into a Patent Purchase Agreement (the “Patent Purchase Agreement”) with CPTN Holdings LLC, a Delaware limited liability company and consortium of technology companies organized by Microsoft Corporation (“CPTN”). The Patent Purchase Agreement provides that, upon the terms and subject to the conditions set forth in the Patent Purchase Agreement, Novell will sell to CPTN all of Novell’s right, title and interest in 882 patents (the “Assigned Patents”) for $450 million in cash (the “Patent Sale”).

The Patent Purchase Agreement contains representations and warranties of the parties, including with respect to Novell’s title to the Assigned Patents, existing licenses and rights with respect to the Assigned Patents, restrictions on rights to the Assigned Patents, the validity and enforceability of the Assigned Patents and the equity commitments of the members of CPTN to fund CPTN in an aggregate amount equal to or exceeding $450 million.

The Patent Purchase Agreement will, by its terms, automatically terminate upon the termination of the Merger Agreement, except that, if Novell receives an acquisition proposal that contemplates an acquisition of Novell other than by an acquirer whose acquisition proposal contemplates that Novell will retain all of the Assigned Patents, Novell deems such a proposal to be a superior proposal to the Merger, and CPTN elects to continue the Patent Purchase Agreement, the Patent Purchase Agreement will remain in full force and effect. Under such circumstances, references in the Patent Purchase Agreement to the Merger Agreement will automatically be deemed to be to the acquisition agreement between Novell and the party from which Novell has accepted the superior proposal (the “Alternate Merger Agreement”). In addition, CPTN may also elect to continue the Patent Purchase Agreement in the event that the Merger Agreement is terminated for any other reason than Novell’s receipt of an acquisition proposal for the entire company that it deems to be a superior proposal to the Merger, in which case the Patent Purchase Agreement will remain in full force and effect and references in the Patent Purchase Agreement to the Merger Agreement shall automatically be deemed to be of no force or effect.

Each of Novell and CPTN has separate rights to terminate the Patent Purchase Agreement without the agreement of the other party if (i) the closing of the Patent Sale has not occurred or it will not be possible for the closing of the Patent Sale to occur on or prior to April 20, 2011 (or if extended, the outside termination date specified in the Merger Agreement or an Alternate Merger Agreement, if applicable), provided that this termination right will not be available to a party if its breach of the Patent Purchase Agreement has been the cause of or resulted in the failure to consummate the Patent Sale; or (ii) the closing of the Merger does not occur immediately after the closing of the Patent Sale (unless CPTN has waived such termination right), provided that this termination right will not be available to a party if its actions have been the cause of or resulted in the failure to consummate the Merger. In the event that CPTN has elected to continue the Patent Purchase Agreement following a termination of the Merger Agreement as described above, Novell and CPTN will enter into a royalty-free, fully paid-up patent cross license for no additional consideration, effective as of the closing, with respect to all patents and patent applications owned or controlled by them on mutually acceptable terms that are no less favorable in the aggregate to either party than the terms of any other patent cross license offered by CPTN to any other person (other than any member of CPTN or an affiliate of any such member).

Consummation of the Patent Sale is subject to certain conditions to closing, including, among others, (i) the expiration or termination of the waiting period applicable to the consummation of the Patent Sale under the HSR Act and certain other antitrust laws; (ii) all required governmental approvals under applicable law shall have been obtained; (iii) the absence of any law, order or other action enjoining or otherwise prohibiting consummation of the Patent Sale; (iv) the absence of any threatened or pending action by any governmental entity challenging or seeking to prevent, alter or materially delay the Patent Sale, seeking to restrain or interfere with the operation of CPTN or the Assigned Patents or seeking to require CPTN or any of its members or affiliates to divest any assets (including any Assigned Patents) or businesses or to agree to restrictions or limitations on its assets (including any Assigned Patents) or businesses; (v) the absence of any threatened or pending action with respect to CPTN by any person (other than a party to the Merger Agreement or its affiliate) that CPTN reasonably believes is reasonably likely to prevail in preventing, enjoining or materially altering or delaying the closing of the Patent Sale beyond a reasonable period of time under the circumstances and that, if successful, would reasonably be expected to adversely affect the benefits of the Patent Sale to CPTN in any material respect; (vi) the satisfaction or waiver of each of the conditions to the consummation of the Merger or alternate merger (other than the closing of the Patent Sale), and the parties to the Merger Agreement or the Alternate Merger Agreement, as the case may be, shall be ready, willing and able to consummate the Merger or alternate merger, as the case may be, immediately after the closing of the Patent Sale; (vii) the accuracy of the parties’ respective representations and warranties; and (viii) the parties’ respective compliance with agreements and covenants contained in the Patent Purchase Agreement.

Information Regarding Certain Relationships

Novell and Microsoft are parties to a Business Collaboration Agreement, a Technical Collaboration Agreement and a Patent Cooperation Agreement that collectively were designed to build, market and support a series of new solutions to enhance the interoperability of Novell’s products with Microsoft’s products.

That does make it sound like the patent sale is related to the joint work Novell has been doing with Microsoft. That patent deal expires in 2011, after all.

But I note that Miguel de Icaza tweets that Mono goes to Attachmate. Watch out, y'all. We warned you and warned you about Mono, did we not? Did you listen? I hope you will now. If you go to Google Patents and search for Miguel de Icaza, you'll find two patents.

The legalese in the 8K about various other buyers doesn't mean anything except that it's language saying that if the Attachmate deal doesn't go through, it would impact the patent sale. Then the consortium can back out or decide to go with the new buyer. That's just protective language. But it also indicates to me that the consortium sees some relationship between the value of the patent sale and the merger with Attachmate. And that is worrisome. I mean, are we looking at a kind of cloaked Microsoft buy by proxy of SUSE and with it Mono? Any antitrust possibilities, if so? Since Attachmate is a privately owned company, I guess that means Novell is going private, at least for now, I guess you could say.

When I go to the USPTO website and search the PAIR database for Novell as assignee and UNIX in all fields, I come up with 102 patents. If you just search for Novell as assignee, you only get 461. If I search for SUSE, I get zero. Of course, that's just the US. Novell has patents registered in other countries as well. If you want to search through that, just go here to the UK's Esp@cenet and you can search worldwide or by area. Here's one Novell registered in Europe, for example. "Processing HTML extensions to enable support of information cards by relying party." Speaking of stupid software patents. So it is not beyond conceivability that Novell has sold its entire patent portfolio. But let's wait until we know a bit more. What we know for sure is bad enough for one day.

And may I say thank you to Richard Stallman for inventing the GPL? Novell has released Linux under that license for some time, and so it provides Linux the only patent protection that Novell couldn't sell. And to the Linux kernel guys, time to rethink an upgrade on that license to GPLv3? You think?

And OIN? Linux Foundation? Who's who now? What happens to the memberships? The patents promises? I see Matt Osoff of Business Insider on the San Francisco Chronicle is saying Microsoft wants patents to use to force more cross-licensing deals:

The deal helps Microsoft in its decade-long fight against open-source operating system Linux in two ways.

First, it keeps a Microsoft competitor from buying Novell's SUSE Linux implementation. VMWare was looking at buying SUSE so it could sell a top-to-bottom software stack that would compete directly against Microsoft's Windows Server and its built-in virtualization technology. This was a major fear in Microsoft's server group, according to my sources there.

Second, although the companies didn't say exactly what patents were included, it seems likely that some of them are related to SUSE Linux. If so, these patents will give Microsoft further ammunition to sign cross-licensing deals with companies that sell other products based on Linux. And those licensing deals will continue to raise questions in the mind of potential Linux customers.

If that's so, Microsoft is a lot like SCO, a dying company hoping that Linux will pay it tolls for "IP" and thus help it to survive. What? You say it can't make much that way? Then that leaves another more obvious thought, that it wants to kill Linux with patents. Maybe both. But here's what I think we can rely on, judging from the past: Microsoft likes to scare people with patents. I'm not overly concerned, frankly. They are what they are and they do what they do.

Update: There's already a shareholder lawsuit:

Kendall Law Group, led by former federal judge Joe Kendall, is investigating Novell, Inc. (NASDAQ: NOVL) for shareholders in connection with the proposed acquisition by Attachmate Corporation. The national securities firm’s investigation seeks to determine whether Novell and its Board breached their fiduciary duties by entering into the agreement without properly shopping for a deal that would provide better value for shareholders. If you are a Novell shareholder and would like additional information about your rights, contact the Kendall Law Group at 877-744-3728 or by email at skendall@kendalllawgroup.com.

Update 2: And now there is another:

Law office of Brodsky & Smith, LLC announces that it is investigating potential claims against the Board of Directors Novell, Inc. (“Novell”) or the “Company”) (Nasdaq:NOVL - News) relating to the proposed acquisition by Attachmate Corporation (“Attachmate”).

Under the terms of the transaction, Novell shareholders would receive cash of $6.10 for each share of Novell stock they own. The investigation concerns possible breaches of fiduciary duty and other violations of state law. The transaction appears to be unfair, in part, given that Novell traded at $6.51 a share as recently as September 22, 2010 and an analyst set a price target for Novell at $7.50 per share. In addition, in March of this year, Novell rejected a $2 billion takeover offer from shareholder Elliott Associates LP as inadequate. Thus, shareholders need additional information to know if Attachmate is underpaying for the company.

If you own shares of Novell and wish to discuss the legal ramifications of the proposed transaction, or have any questions, you may e-mail or call the law office of Brodsky & Smith, LLC who will, without obligation or cost to you, attempt to answer your questions. You may contact Jason L. Brodsky, Esquire or Evan J. Smith, Esquire at Brodsky & Smith, LLC, Two Bala Plaza, Suite 602, Bala Cynwyd, PA 19004, by e-mail at investorrelations@brodsky-smith.com, visiting http://brodsky-smith.com/246-novl-novell-inc.html, or by calling toll free 877-LEGAL-90.

I have a question, actually, although I'm not a shareholder. What exactly did Attachmate pay? TechFlash, above in the media section, wrote: "Novell says in its news release that the $450 million cash payment from the Microsoft group is "reflected in the merger consideration" paid by Attachmate..." so how does that figure in, and what is the connection between the two deals or the two entities for that matter?

Update: After some reflection and reading what others have written and discussing this with a lawyer who handles this type of transaction, although not this one, I gather that what Novell is actually paying is less than it looks. I mean, they don't have to pay Elliott for its shares, I guess, since Elliott says it gets an investment share of AttachMate. The $450 million is subtracted from the total also, in that it seems to go to the buyer, not to Novell. That's odd. And surely Novell is retaining a license to use its patents in its ongoing business if it needs any of them to do that. [Also, now that I think of it, Novell reportedly has about a billion in the bank, no? So Attachmate gets that in the deal, so in effect Attachmate is buying Novell with Novell's own money up to that amount.]

So I think that explains why there are two incipient shareholder suits claiming Novell sold for too little. Whether they did or not isn't for me to even guess at. It's not my area of expertise. Even if it were, there aren't enough facts yet publicly known. I'm just trying to figure out why there would be litigation, and that seems to be the why of it.

As for the question of what happens to prior promises Novell made, if they are contractual, you go by the contract. In a stock for stock merger, I'm told by a lawyer, all obligations remain in force. In an asset sale, the two negotiate who gets what. But if the buyer *takes over* a contract, then they have to honor all of the terms of the contract, such as a patent license or cross license. Or it can, as part of the deal, insist that the seller renegotiate certain terms or they won't do the deal. What the terms of this deal are, we don't yet know. But what I learned is that shareholders will get more disclosure documents sent to them, and since I know some of my readers are shareholders, perhaps we'll find out more as this goes forward. And on the patents, any time patents transfer, you have to file documents about it with the USPTO, so in time we will get more clarity on that too. Meanwhile, I prefer not to guess too much, and I'm content to wait and get it right.


  


Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium - Updated | 388 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
This is going to be a huge... SCO Saga all over again.
Authored by: gfolkert on Monday, November 22 2010 @ 01:42 PM EST
Especially, since we *all* know that the "certain assets" being sold
to the consortium led by Microsoft is the UNIX related stuffs...

Crud

[ Reply to This | # ]

Corections here please, if needed
Authored by: tiger99 on Monday, November 22 2010 @ 01:46 PM EST
Please indicate the nature of the correctionin the title of your post.

[ Reply to This | # ]

Novell's 8k
Authored by: rsteinmetz70112 on Monday, November 22 2010 @ 01:47 PM EST
Novell's 8K

"Novell will sell to CPTN all of Novell’s right, title and interest in 882
patents."

http://sec.gov/Archives/edgar/data/758004/000119312510265964/d8k.htm

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

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

[ Reply to This | # ]

Off topic here please
Authored by: tiger99 on Monday, November 22 2010 @ 01:47 PM EST
If you post on-topic in this thread you may be flamed.....

Please remember the clickies, and PJ's posting policy guidelines.

[ Reply to This | # ]

Newspick discussions here please
Authored by: tiger99 on Monday, November 22 2010 @ 01:49 PM EST
Please indicat which Groklaw Newspick item you are referring to in the title of
your post, and it may be helpful to also make a clicky for when it scrolls off
the bottom of the page.

[ Reply to This | # ]

Comes may go here
Authored by: tiger99 on Monday, November 22 2010 @ 01:50 PM EST
For those who are still transcribing the depositions....

[ Reply to This | # ]

IP == 882 Patents, just about everything Novell owns
Authored by: stats_for_all on Monday, November 22 2010 @ 01:51 PM EST
Text below from the 8K filed by Novell (link at bottom).

Patent Purchase Agreement

Also on November 21, 2010, Novell entered into a Patent Purchase Agreement (the “Patent Purchase Agreement”) with CPTN Holdings LLC, a Delaware limited liability company and consortium of technology companies organized by Microsoft Corporation (“CPTN”). The Patent Purchase Agreement provides that, upon the terms and subject to the conditions set forth in the Patent Purchase Agreement, Novell will sell to CPTN all of Novell’s right, title and interest in 882 patents (the “Assigned Patents”) for $450 million in cash (the “Patent Sale”).

The Patent Purchase Agreement contains representations and warranties of the parties, including with respect to Novell’s title to the Assigned Patents, existing licenses and rights with respect to the Assigned Patents, restrictions on rights to the Assigned Patents, the validity and enforceability of the Assigned Patents and the equity commitments of the members of CPTN to fund CPTN in an aggregate amount equal to or exceeding $450 million.
From just filed NOVL 8K filed on the sale.

Patent-Pair assignment database can be searched for Assignee Novell, and shows (about) 775 entries. (or 31 pages x 25 entries per page). These include "applications" and granted patents, but not unpublished applications. So the total patents sold likely represent every single patent owned by Novell.
Patent Pair Assignment Database Caution the Patent Pair does not do GREP so Novell also finds Novellus patents.

[ Reply to This | # ]

Wordperfect suit and United Linux Arbitration now dead?
Authored by: SpaceLifeForm on Monday, November 22 2010 @ 01:51 PM EST
Novell sales declined last three years.

And how long ago was the Microsoft-Novell FUD agreement made?

Hmmm.


---

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

[ Reply to This | # ]

D O O M
Authored by: Anonymous on Monday, November 22 2010 @ 01:56 PM EST
Yay, another 10 years of lawsuits against Linux (to be resolved same way as
AT&T v BSD I am sure).

:- [

[ Reply to This | # ]

Kendall Law Group Investigates Novell, Inc. Acquisition for Shareholders
Authored by: Anonymous on Monday, November 22 2010 @ 01:59 PM EST
<a
href="http://eon.businesswire.com/news/eon/20101122005908/en/Kendall-Law-Gr
oup-Investigates-Novell-Acquisition-Shareholders"> link </a> It
appears many eyes are looking into this. This set of deals may fall through.

[ Reply to This | # ]

AntiTrust
Authored by: Anonymous on Monday, November 22 2010 @ 02:18 PM EST
Won't this be up for some sort of antitrust review?

[ Reply to This | # ]

  • Nope - Authored by: Anonymous on Monday, November 22 2010 @ 02:33 PM EST
    • Nope - Authored by: Anonymous on Monday, November 22 2010 @ 06:44 PM EST
    • Nope - Authored by: Anonymous on Monday, November 22 2010 @ 11:05 PM EST
    • Nope - Authored by: Anonymous on Tuesday, November 23 2010 @ 12:20 PM EST
What is CPTN getting?
Authored by: TemporalBeing on Monday, November 22 2010 @ 02:58 PM EST
Perhaps they are getting Mono and all that cruft? After all, didn't Novell agree
to continue development of Mono? Microsoft has an interest in keeping Mono
around, so perhaps it is about keeping Mono around while not quite admitting
it?

Though I can't help but think...
Crafty Patents To Nuke Holdings LLC?
Common Patents To Nuke Holdings LLC?
Common Patents Taken [from] Novell Holdings LLC?
Consortia [of] Patents Taken [from] Novell Holdings LLC?

What's CPTN stand for any how?

[ Reply to This | # ]

What will Attachmate do with Novell
Authored by: Anonymous on Monday, November 22 2010 @ 02:58 PM EST
Private equity typically does one of two things:
1. Cut expenses to the bone to make the company appear more profitable, and sell
it to someone else. This guts the new product lines, but that will be the next
buyer's problem.
2. Use company cash/borrowing ability to pay itself extraordinary dividends, get
their cash out of the deal, and let the bondholders or next buyer deal with an
over-leveraged company, typically through an eventual bankruptcy.

On rare occasions, there will be a private equity investment which can fix a
company which has lost its way, and make it profitable again. But, these are
rare, because most of the private equity investors are financial, and all they
care about is their return on equity, not their employees, nor their customers.
The financial investors don't know how to run the company. But, this isn't all
bad, as it tends to get rid of management just in it for themselves rather than
the shareholder, and this may be enough to rescue the company.

[ Reply to This | # ]

Why doesn't this get the same sort of scrutity as other monopolistic behavior?
Authored by: Anonymous on Monday, November 22 2010 @ 03:01 PM EST
Patents are government-granted monopolies. Why doesn't consolidation of patent
monpopolies get the same sort of scrutiny that other monopolistic activities do?

[ Reply to This | # ]

Oh Dear. Something is rotten in the state of Denmark
Authored by: SilverWave on Monday, November 22 2010 @ 03:13 PM EST
.

---
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 | # ]

Wait a minute! Is this why SCO delayed? A Hail Mary pass?
Authored by: SilverWave on Monday, November 22 2010 @ 03:17 PM EST
Well that doesn't look good.

---
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 | # ]

AttachMate
Authored by: dmarker on Monday, November 22 2010 @ 03:34 PM EST

 

Just putting forward what I know about Attachmate (I looked very closely at them a few years back (approx 2006) - as was interested in joining them at the time.

It is a privately owned middleware integration company that had its strength in the Unix market. Especially things like green screen emulation & inter systems connectivity. Host connectivity was their greatest strength.

The owners are a group of private investors (Golden Gate Capital, Francisco Partners, and Thoma Cressey Equity Partners), who own a collection of tech companies. Attachmate appear to do very well but being privately owned it was difficult to know just how big the business was. They list a very big number of global customers inc many top tier corporations.

They were headquartered in Seattle WA. Attachmate were in Bellvue & when WRQ (previously bought be the same investors) & Attachmate merged they moved to the WRQ offices nearby in Washington near Lake Union.

Just found this Wiki link - it is probably the better source for an up-to-date assessment.

Attachmate on Wikipedia

About the WRQ & Attachmate merger & the investors who own them

DSM

 

[ Reply to This | # ]

  • AttachMate - Authored by: Anonymous on Monday, November 22 2010 @ 06:37 PM EST
  • AttachMate / WRQ - Authored by: artp on Tuesday, November 23 2010 @ 12:35 AM EST
  • AttachMate - Authored by: JJSg on Tuesday, November 23 2010 @ 04:51 PM EST
Sun -> Oracle
Authored by: Anonymous on Monday, November 22 2010 @ 03:36 PM EST
I never thought that Sun selling out to Oracle would ever look this good to
me...

Thanks Novell, ever since that deal you have been making the FOSS community's
life harder. And now , when it was time to end, instead of having a redeeming
moment, you ruined it even more.

Michael Meeks was completely right the other day when talking about FOSS
development and corporations.

[ Reply to This | # ]

Novell Sells To M$
Authored by: Anonymous on Monday, November 22 2010 @ 03:36 PM EST
hahahahahhahahhhahahahahahaha oh my sides are hurting

[ Reply to This | # ]

Microsoft Shell Company buys Novell's IP
Authored by: Anonymous on Monday, November 22 2010 @ 03:48 PM EST
This could be the most depressing day in Groklaw history. ;-(

[ Reply to This | # ]

Novell Agrees to be ........ [To the tune of "Tarbaby the Rain Must Fall"]
Authored by: webster on Monday, November 22 2010 @ 04:05 PM EST
.

Is Novell more or less than it was? What is the Attachmate-Novell position on
SCO? Is a settlement with SCO part of the deal? Will Novell now go off and let
SCO do what SCO wants, or will Novell go off and do the same thing SCO did with
the undisputed UNIX rights?

Is there an opposite angle to this whole transaction? Is the Monopoly taking
all the patents and jettisoning the former "most favored SUSE Linux"?

The patents, so far as they are part of any SUSE Linux, are compromised-- at
least to the extent that they could mess up the clarity and conviction of any
jury trial even with just the GPLv2. Certainly every potential target has
purchased their periodic proof copy. Is this just a sign of the Monopoly
thrashing with its millions about in the bushes entwined by parts, private and
otherwise, of a viral, virile tarbaby?

.

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate
Authored by: Anonymous on Monday, November 22 2010 @ 04:15 PM EST
So Novell gets acquired by AttachMate or M$oft or whoever. But from whom?
I mean, sorry, but i do not understand! Seems as if M$, becoming the owner of
Novell, is paying itself for taking over Novell?
In all the deal who flies away with money? Who is the real bad guy?

[ Reply to This | # ]

Patents: Microsoft estopped?
Authored by: darkonc on Monday, November 22 2010 @ 04:16 PM EST
My argument would be as follows:

As a part or Novell distributing GPL code they had to agree that recipients of that code could use it (effectively forever) without any sort of royalties to Novell. To the extent to which Novell owned (valid) patents on that code, the right to exercise the patents related to that code would have to be granted with that (re)distribution. The sale of those patents would not negate the rights granted to the users of GPL code that was distributed with those grants.

Now, this would not apply to code which develops patent violations after the sale, but currently existing code (and derivatives thereof) would be immune to patent attacks using Novell patents

---
Powerful, committed communication. Touching the jewel within each person and bringing it to life..

[ Reply to This | # ]

How long before M$ acquire AttachMate
Authored by: calris74 on Monday, November 22 2010 @ 04:35 PM EST
They have the dollars

But I assume the US government would block the deal...

Did I really think that? I really need to climb out of the
rabbit hole, I'm becoming delusional.

[ Reply to This | # ]

Mono Future?
Authored by: Anonymous on Monday, November 22 2010 @ 04:37 PM EST
De Icaza's tweet just said that nothing is changing for now. Generally however,
that's what all companies say when they do a take over. The employees will find
out the new management's strategy when they get called to an unscheduled meeting
and are escorted out the door. I expect that the final ramifications of this
deal won't be known for at least six months.

Last week de Icaza published a post on his blog where he was asking about ideas
on how to raise money for a new start-up business. I would expect that he is
reviewing his options at this time regardless of his official statements.

Novell has a big rag bag of things they've been dabbling in for years, and
losing money steadily in the process. I rather doubt that the new owners will
want to continue with the same unsuccessful strategy.

[ Reply to This | # ]

Kernel guys - GPLv3 rethink
Authored by: Anonymous on Monday, November 22 2010 @ 05:40 PM EST
It will not and cannot happen. There is too much Kernel code written by too
many different people (some of them dead). The original copyright holder would
need to re-release under GPLv3 (unless the copyrights were assigned). Linus has
stated that he is quite happy keeping things the way they are under GPLv2.

[ Reply to This | # ]

Article states that Novell has 461 granted patents
Authored by: Anonymous on Monday, November 22 2010 @ 06:14 PM EST
bnet.com article

...according to the US Patent and Trademark Office database, Novell has a total of 461 granted patents. So under whose name are the other 421?

In addition, there are another 287 patent applications.

Add those together, and you still end up with only 748 granted patents or patent applications, which at a minimum leaves another 134 unaccounted for.

[ Reply to This | # ]

A question about stock holders
Authored by: Yossarian on Monday, November 22 2010 @ 06:52 PM EST
I am a stock holder of Novell. (I sold SCO short when it was
$1.5 and used the money to buy Novell and hold it long.)

Do I, and other small stock holders, get any say about this
sale? If there will be a vote, will big stock holders who have
direct involvement with the buying company be allowed to vote?

[ Reply to This | # ]

Arstechnica article - see the graphic
Authored by: SpaceLifeForm on Monday, November 22 2010 @ 07:28 PM EST
Link

---

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

[ Reply to This | # ]

A buyout clause in the IBM $50Mill investment in Novell
Authored by: Davo.Sydney on Monday, November 22 2010 @ 08:15 PM EST
I haven't looked at the contract between IBM and Novell yet, and I can't
remember seeing a copy. Surely there would be a SUSE/Novell "BUYOUT
CLAUSE" in it wouldn't there?. IBM aren't silly after the ambiguity in the
Novell-SCO APA. After all, $50 Million is the same amount SCO paid Novell for
Unixware (not including shares etc.) is it not?

If anyone has a link to it, it would be great if someone could post a link to it
here. Thanks in advance.

And surely even if there is a buyout, IBM would still have an interest, and
retain any rights they purchased, in SUSE, unless all they bought were shares,
which I would find difficult to believe...

[ Reply to This | # ]

Only way to stop that ironclad patent deal
Authored by: Anonymous on Monday, November 22 2010 @ 08:44 PM EST
According to the quoted press release, the only way to stop the patent deal is
for another consortium to make a higher offer for all of Novell and to make it
conditional on keeping the patents etc.

In all other scenarios, Microsoft still gets the patents.

Anyone with a spare 3G$ to outbid the combined offer from MS and Attachmate?

[ Reply to This | # ]

Jumping the gun?
Authored by: Anonymous on Monday, November 22 2010 @ 08:50 PM EST
PJ said in the update: "There's already a shareholder lawsuit."

The press release she linked to was already out by 10:00 AM! Are you sure there
was already a lawsuit? It looked to me that it was just some ambulance chasers
looking for a plaintiff. Don't you have to have someone to act as a plaintiff
before you can have a lawsuit?

Once they file, there isn't any reason for them to attempt to contact
shareholders like that. They just get the case converted into a class action and
automatically get rest of the shareholders that way.

[ Reply to This | # ]

Did Novell ever contribute patents to the ODSL patent pool?
Authored by: kh on Monday, November 22 2010 @ 09:43 PM EST
Did Novell ever contribute patents to the ODSL patent pool?

[ Reply to This | # ]

I Got Friends In Weird Places....
Authored by: TheBlueSkyRanger on Monday, November 22 2010 @ 10:33 PM EST
Hey, everybody!

Two questions:

1) Is it possible that M$ is preparing to take on Oracle? After all, they now
own Sun (Unix) and between OpenOffice.org and Java and MySQL and Unbreakable
Linux and such...is M$ gearing up to attack Oracle to stop them from bundling a
business solution (I can't believe I just typed that without irony) given that
M$ is also losing lots of customers and revenue?

2) Where was IBM with all this? I know they and Novell were good buddies, and
IBM already missed out once on a dynamite acquisition thanks to Oracle. Did it
just not make sense to do anything with Novell?

Dobre utka,
The Blue Sky Ranger

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium
Authored by: Anonymous on Monday, November 22 2010 @ 11:06 PM EST
you I remember when you could corel linux at target then they
were bought by microsoft and that version of linux was gone.

where is the doj in all this are they really that bought off
so that they won't touch microsoft.

this is a sad day. I still say novell netware blows windows
nt away as a server - lol - NDS is still better than active
directory.

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium
Authored by: Anonymous on Monday, November 22 2010 @ 11:11 PM EST
RIP Novell - lets hope suse gets bought by someone who
understands open source and can create value.

[ Reply to This | # ]

Leave Dana Blankenhorn out of this
Authored by: Anonymous on Tuesday, November 23 2010 @ 01:42 AM EST
PJ, you shouldn't allege an anti-Groklaw smear campaign.
Dana Blankenhorn wrote an article you don't like. I don't
agree with all of it either. But it won't do us any good to
make Dana part of a conspiracy theory including Microsoft
and the Novell deal.

Dana gave you an award. He raved about your great work. He
still said nice things about you in that Friday afternoon
article. He just decided to criticize you because several
named sources complained about postings being "expunged"
here on Groklaw even if there's nothing objectionable in
them. Some of us think it's good that you moderate Groklaw
and maintain a certain standard. But people have the right
to disagree and consider this a form of heavyhandedness and
not open-source-like. Dana came down on that side but he'll
always be closer to open source and Groklaw than to
Microsoft. He doesn't seem to promote the Novell thing BTW.

Let's unite not divide the community.

We don't know if Muller ran just one attack or if there's a
whole campaign against you in the making. He still hasn't
mentioned Groklaw (the name) even once on his blog. He just
uploaded something to scribd. There's a good chance that
he'll leave it at that. But you never know. On ZDNet he
wrote that he keeps a whole collection of things to use
against you.

Like Dana I'm a big fan of Groklaw. I like Dana's blog
though often disagree. It's always an interesting read.

But I don't see a conspiracy against you. Or are you telling
us that it was just Microsoft and FM who deleted those
Groklaw comments? No, it was you and your volunteer
supporters maybe. Be more careful about those accusatory
remarks. ZDNet belongs to CNET belongs to CBS Interactive.
It's a big network. I wouldn't want to make myself enemies
there if it can be avoided. This isn't just Dan Lyons on his
personal blog talking about the OSDL having paid you 50
grand. Or MOG. Or Paul McDougall of InformationWeek. This
time it's something much bigger and very few people will
believe it has anything to do with Microsoft buying Novell's
patents.

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium
Authored by: IMANAL_TOO on Tuesday, November 23 2010 @ 02:45 AM EST
Attachmate's offer of $6.10 per share follows the $5.75 a share offer made in
March by investment firm Elliott Management Corporation, one of Novell's largest
shareholders. Novell rejected that offer. But as part of the deal announced
Monday, Elliott is to become an equity shareholder in Attachmate, according to a
statement.
http://www.computerworld.com/s/article/9197598/Update_Attachmate_to_buy_Novell_f
or_2.2_billion

The $6.10 per share consideration represents a premium of 28% to Novell's
closing share price on March 2, 2010, the last trading day prior to the public
disclosure of Elliott Associates, L.P.'s proposal to acquire all of the
outstanding shares of Novell for $5.75 per share and a 9% premium to Novell's
closing stock price on November 19, 2010.
http://www.novell.com/news/press/novell-agrees-to-be-acquired-by-attachmate-corp
oration/

Elliott's man in Hollywood is 29-year-old Jesse A. Cohn, a Wharton grad and
portfolio manager who had specialized mostly in technology investments and
biotech companies before deciding in 2006 to invest in Hollywood, too. That was
when talk of making bundles on DVD releases, online distribution, and all things
digital attracted a ton of private equity investors (many of whom went bust).
Cohn's first investment was a ho-hummer as well.
http://www.businessweek.com/bwdaily/dnflash/content/may2009/db20090522_021634.ht
m


Jesse Cohn and producer Tucker Tooley arrive on the red carpet of the Los
Angeles premiere of 'A Perfect Getaway" http://www.life.com/image/93096869




A spin doctor or a cohnman?




---
______
IMANAL


.

[ Reply to This | # ]

What Novell's assets and related patents will AttachMate pursuit ?
Authored by: Anonymous on Tuesday, November 23 2010 @ 04:31 AM EST
If AttachMate want to buy Novell, its because they're interested upon their
assets, including the related patents.

Arstechnica mention that Novell was operating in this areas:
development tools
cloud computing
mobile space
netbook stack
Mono projec
virtual appliance tools
suse linux

I guess that AttachMate is not interested to get involved at all these areas,
and can easily give up on the related patents, as well as other older Novell
patents not related to its actual products. Anyway, AttachMate could not afford
to give away to M$ any Novell's proprietary patents related to the areas they
pursuit for busines.

Does everybody agree with me, on this?

In my opinion, AttachMate is not looking after, at least, cloud computing and
mobile space. So, the proprietary patentes related to those, as well as the
above mentioned older Novell patents, are all included in the "Patent
Purchase Agreement".

Any different opinions on the above, or about what other patents may be included
in the "Patent Purchase Agreement"?

Where I don't have any clue, is about the M$ vs Novell Agreement. What will
stand out, after the termination date of it?

[ Reply to This | # ]

Sometimes what pleases it most is to get a huge basket of money?
Authored by: Anonymous on Tuesday, November 23 2010 @ 04:37 AM EST
I hope you will be careful never to sign over your copyrights to any commercial vendor where the wording allows the vendor to change the license any way it pleases. Sometimes what pleases it most is to get a huge basket of money.
It is not a matter of pleasure. As a matter of law, they have to work according to their stockholders' wishes.

In today's world, the interest of significant stockholders in publicly traded companies invariably is money. If that weren't their principal interest, they would not have had enough money to be a major stockholder in the first place (unless they got their shares by being company founders, but those tend to be flushed out of the system eventually).

[ Reply to This | # ]

What happens to the SCO lawsuit now - do AttachMate pick this up?
Authored by: TiddlyPom on Tuesday, November 23 2010 @ 04:51 AM EST
I presume that existing cases have to run their course?

Does this mean that AttachMate are free to (say) let SCO off the hook to
continue their attacks on Linux?

If Microsoft have picked up "anti-Linux" patents - are they
susceptible to some form of anti-trust legislation or other 'poisonous monopoly'
lawsuit?

Personally I think we should be on our guard after what has happened but not
despondent. That is exactly what Microsoft (and other proprietary software
vendors) want - to demoralize the Linux/BSD community - and it is important to
not let them win in any way. The next step is to see what AttachMate and
Microsoft plan to do with their 'assets' and see whether they can affect the
Linux community.

If Microsoft have got access to the Unix copyrights then they MUST be referred
to the monopolies courts.

This is bad news - but not the end of the world.

---
Microsoft Software is expensive, bloated, bug-ridden and unnecessary.
Use Open Source Software instead.

[ Reply to This | # ]

"Method binding network administrators as the root user on linux "
Authored by: Anonymous on Tuesday, November 23 2010 @ 07:50 AM EST
From a Patent application dated June 22, 2006.

-BS-

[ Reply to This | # ]

Kendall Law Group
Authored by: Anonymous on Tuesday, November 23 2010 @ 10:06 AM EST
The Kendall Law Group made a similar announcement about investigating on behalf of Novell shareholders back before any decision had been made by Novell's board whether to accept or deny the original offer by Elliott & Associates. Here is an article from Enhanced Online News on that announcement from March 4, 2010. with a snippet below:
DALLAS--(EON: Enhanced Online News)--Kendall Law Group, a national shareholder rights law firm, launched an investigation into Novell Inc. (NASDAQ: NOVL) in connection with the proposed acquisition by Elliott Associates, L.P. The firm is concerned that the Board of Directors of Novell may breach their fiduciary duties by failing to seek other deals to better represent the value of the company if they agree to this proposal.
If you search on "Kendall Law Group" you'll find many announcements like this about them "investigating" the boards of directors of other public companies on behalf of their shareholders as well. Seems like ambulance chasing to me.

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium
Authored by: phantom21 on Tuesday, November 23 2010 @ 10:56 AM EST
The MS thing is the reason, when Novell made their deal with them in 2006, I
stopped using SUSE.

I don't trust, and have no reason to trust, Microsoft and anything they do. If
a company makes a deal with MS that company generally dies.

I would have much preferred SUSE had been sold to VMware.

But. this will give a lot of grist for Groklaw's mill.

[ Reply to This | # ]

Maybe ...
Authored by: Anonymous on Tuesday, November 23 2010 @ 12:09 PM EST
Novell sells patents and copyrights to MS. MS reinterprets the APA and gives
the "required" copyrights to SCO. A reinvigorated SCO marches on with
further lawsuits.

[ Reply to This | # ]

  • Maybe ... - Authored by: PJ on Tuesday, November 23 2010 @ 12:59 PM EST
  • Maybe ... - Authored by: tknarr on Tuesday, November 23 2010 @ 12:59 PM EST
The press release as it should have been...
Authored by: Anonymous on Tuesday, November 23 2010 @ 12:41 PM EST
Novell is pleased to announce that we've seen the writing on the wall and decided to sell out before it's too late.

Our cash cow Netware is in a terminal dive, our detail with the Devil Microsoft was not as lucrative as we had hoped, and no one is buying our Linux offerings since we contracted Mono. We need to maximize shareholder value by selling off all the pieces before we crater.

[ Reply to This | # ]

So many anonymous posters dispensing advice
Authored by: cjk fossman on Tuesday, November 23 2010 @ 01:08 PM EST
This seems to happen every time there's a new major story
line in Groklaw.

At least this old mantra seems to be gone: "Groklaw was so
great when it did XXX but now that it does YYY it doesn't
work."

[ Reply to This | # ]

Novell going cheap?
Authored by: Anonymous on Tuesday, November 23 2010 @ 03:19 PM EST
networkworld.com

...To put that in perspective — for those folks who thought Novell wasn't worth the purchase price — Novell has annual revenue of about $860 million dollars and nearly $1 billion in the bank at the end of the 2009 fiscal year. So $2.2 billion, not really a stretch. One might even say the company went a bit cheap.

I don't know much about finance, but still that does seem a bit on the cheap side. It looks like, at least on paper, that if someone purchased Novell and kept it intact that they'd have the potential to more than make their money back within two years without changing a thing. Surely, that's not normal.

[ Reply to This | # ]

On update 2
Authored by: Anonymous on Tuesday, November 23 2010 @ 03:23 PM EST
They needed to combine the offers from both companies to express a stock buyout
price. So in essense you could remove the patent buyout leaving 2.1 billion
rounded. But a buyout offer is always set at a single stock price.

[ Reply to This | # ]

Here is another thought re Microsoft's posittion ....
Authored by: dmarker on Tuesday, November 23 2010 @ 05:03 PM EST
Thinking out loud

Self has long wondered if Microsoft was vulnerable to Unix patent/copyright
violations. Most of us know Bill Gate's attitude to other people's ip &
property and with the development of NT, I always wondered if MS might
'borrowed' code or more from UNIX. MS had the source starting from Unix Ver 7,
under license from Western Electric when it was the vehicle for licensing Unix.

In my theoretical scenario ...
No one has ever had the opportunity to put MS under a microscope in regard to
its NT code (or Windows code) and if MS had something to hide it may have had an
incentive to fund tSCOg's antics as a multi-year distraction and now may be
close to getting the patents / protection it needs to avoid any serious
scrutiny.

So am putting forward a theory that MS has been trying to hide its own
violations of UNIX copyrights / patents and that encouraging Caldera/tSCOg to
maintain its litigation was an effective tactic at deflecting attention. A side
effect has been to identify just who did have the control of UNIX copyrights
(Novell) and if MS may see a way clear now to gain full protection from past but
hidden misdeeds. The 2006 Novell - MS protection deal seems to support such a
notion.

I can't see that owning UNIX ip can be primarily to destroy Linux distros
because no one has produced a shred of evidence that anything Linux violates
UNIX patents/copyrights.

DSM




[ Reply to This | # ]

How much will Attachmate pay?
Authored by: AntiFUD on Tuesday, November 23 2010 @ 06:32 PM EST
In answer to PJ's question posed at the end of Update 2 to this article:

This is a bit 'back of the envelope' but from what we know:

$2,200 - Purchase Price (Stock and Options at $6.10)
($1,100)- Cash and Short Term Investments (B/S as at 31/7/10)
($450)- Sale of Patents to CAPN LLC
($150)- Conversion of Elliot Capital 7.03% Novell holding (9/30/10) into
Attachmate Stock
________
$500 - Net Cash cost to Attachmate and/or its major stockholders

---
IANAL - Free to Fight FUD - "to this very day"

[ Reply to This | # ]

Why the two "shareholder lawsuits"
Authored by: Anonymous on Wednesday, November 24 2010 @ 12:11 AM EST
So I think that explains why there are two shareholder suits claiming Novell sold for too little.
First, I don't see any indication any shareholder lawsuits have been filed yet. There are at least two law firms that would like to file lawsuits and the why of that is simple. They are scrambling now because they want to make sure they don't get left out if someone else files and converts the case into a class action. When these cases are converted into class actions, anyone who managed to file by then gets a piece, everyone else gets cut out. That intensifies the ambulance chasing. Of course, since it would be a class action suit, if they can cause enough problems to get a settlement, the lawyer's cut is huge. So you have the same mentality as with the patent trolls.

Of course, the need to have something to work with. I can see two things that they might hope might lead to something they could at least make some noise about.

First, a correction. PJ said:
I mean, they don't have to pay Equity for its shares, I guess, since Equity says it gets an investment share of AttachMate.
That should be "they don't have to pay cash for its shares," but they are obviously paying something. Equity will be paid with shares of AttachMate Corperation. Those shares have value. That's value lost by the existing owners of Attachmate, in addition to the cash, so it needs to be considered as part of the cost.

PJ was barking up the wrong tree when she pointed out that Attachmate is paying less cash then it appears at first. There are three problems there: 1) It still doesn't say anything about what was the right amount of cash - maybe the lower amount of cash is the right amount. 2) It doesn't take into account the value of the equity that Attachmate corp lost as part of the payment. 3) It's too obvious -- mutual funds and large investors wondering if $6.10 is enough couldn't possibly miss that. However, the payment of shares to Equity opens the possible argument that the payment to Equity was too much. If the value of the shares of Attachmate that Equity got amounts to more than the equivalent of $6.10 per share, then Equity got preferential treatment in the deal that they helped arrange. Of course, you would need to know more to evaluate that, but the lawyers might hope they might find something there that they could make some noise about.

The other thing that the lawyers might hope might lead to something they can at least make noise about has to do with the rumors and the stock price swings in September. By September 17 the Wall Street Journal was reporting that Novell was in advanced talks to sell SUSE to VMWare and it was known that other investors were looking at the remainder of Novell. As PJ pointed out, Matt Osoff said:
VMWare was looking at buying SUSE so it could sell a top-to-bottom software stack that would compete directly against Microsoft's Windows Server and its built-in virtualization technology. This was a major fear in Microsoft's server group, according to my sources there.
Notice how that is making it look like there is a lot of money at stake. Something that would strike fear in Microsoft's server group would be worth something. He wasn't the only one saying stuff like that. So people started getting all excited and started speculatively buying Novell's stock and the price shot up to just above $6.50 on September 22. After the close, Reuters knocked the stock price back down with this article. (I suspect that Novell's management or J.P. Morgan may have intentionally killed the speculation by arranging leaks for that article, but there is no way to know.) I don't see anything particularly bad in the article, and this article specifically says it was the Reuter's article that cause the stock price drop, so I don't think it was anything else. If there is a smoking gun, it's something that is in that article, or which came out at the same time as that article, because the speculation dried up in the market when it came out.

Realistically, J.P. Morgan has done tons of these deals and presumably the attorneys at Skadden, Arps, Slate, Meagher & Flom LLP is competent, and obviously Novell's board decision was going to be scrutinized and shareholder lawsuits were an obvious possibility, so the chances that Novell's board didn't follow the right steps in valuing everything and picking the best deal is practically nill. If there actually is someone out there willing to pay more, they are free to jump in with a higher offer. I would be very surprised if that happened, though, because it's not as if people haven't known that Novell was for sale, so anyone interested had plenty of time to submit a bid. Novell's board legally couldn't reject a higher bid. If they tried, the chances of them getting away with it would be nill, so they wouldn't try, even if they had some reason.

This doesn't meant that some people won't be disappointed that the won't get more than $6.10 and start complaining loudly about it or file shareholder suits. Greed does that sometimes.

[ Reply to This | # ]

"If you go to Google Patents and search for Miguel de Icaza, you'll find two patents"
Authored by: Anonymous on Wednesday, November 24 2010 @ 11:13 AM EST
So what? Did you have any point to that statement? If you go to Google Patents
and search for Red Hat, you'll find a bunch of patents.

[ Reply to This | # ]

Novell will continue to own Novell’s UNIX copyrights following completion of the merger
Authored by: phands on Wednesday, November 24 2010 @ 03:03 PM EST
http://www.novell.com/company/ir/message.html

Looks like CPTN isn't going to replace SCOX in the anti-Linux jihad.....

>>
On November 22, 2010, Novell issued a press release announcing a definitive
merger agreement under which Attachmate Corporation (“Attachmate”) would acquire
Novell for $6.10 per share in cash (“Merger Agreement”). Novell will continue to
own Novell’s UNIX copyrights following completion of the merger as a subsidiary
of Attachmate. Novell filed a Form 8-K/A with the SEC on November 22, 2010, with
respect to the Merger Agreement.
<<

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium - Updated
Authored by: jsusanka on Wednesday, November 24 2010 @ 03:33 PM EST
another microsoft partner buys linux technology. citrix
bought xen and we all see how that went.

I could go on but why isn't the doj stepping in? Is it
because it isn't microsoft directly? well tell me what is
the difference if a "partner" is just an extension of
microsoft where do they draw the line. it is obvious
microsoft has found a way around the doj by going through
partners and LLC's. I think it is time the doj restarts
their investigations.

[ Reply to This | # ]

Andy Updegrove's analysis
Authored by: Anonymous on Wednesday, November 24 2010 @ 04:26 PM EST
FWIW, Andy Updegrove has a new blog post: Understanding the Novell Deal (and when we'll learn more). He spent quite a bit of time looking at the 8-K.

[ Reply to This | # ]

Novell Agrees to be Acquired by AttachMate; Sells Some IP to a MS-Organized Consortium - Updated
Authored by: Anonymous on Thursday, November 25 2010 @ 12:28 AM EST
Interesting. I've been using WRQ, used to be Reflections, for sixteen years.

[ Reply to This | # ]

Groklaw © Copyright 2003-2013 Pamela Jones.
All trademarks and copyrights on this page are owned by their respective owners.
Comments are owned by the individual posters.

PJ's articles are licensed under a Creative Commons License. ( Details )