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Judge Tells SCO: No, *You* Have to Show the Code First - UPDATED: 7 PM EDT
Friday, December 05 2003 @ 04:13 PM EST

The big news from the hearing today is that Judge Wells told SCO that they have to go first. They have to show IBM what code they are alleging is infringing. All during discovery, SCO has been telling IBM they had to show all their code first, and then SCO would identify the alleged infringements. IBM kept telling SCO in reply that they had the burden, as plaintiffs, to at least tell IBM what code was involved. Today the judge told SCO that IBM was right. SCO has 30 days to comply. IBM doesn't have to turn over anything until they do it. The judge's order will be filed Wednesday, and SCO has a month to show the code. They can't force IBM to go first. That dance is over.

Cody Hilton of Guru Labs , a Utah Linux training company, attended the hearing, and the second big piece of news is that David Boies didn't show up. Darl's brother represented SCO. His brother is Kevin McBride, the same person we noted who was involved in writing the Open Letter yesterday.

Why Boies didn't show up is hard to understand. And then again, maybe not. Brent Hatch was there and so was Darl. There was no media presence at all. Or more accurately, there was a lot of press there in the building but they were all there to cover the Olympic bribery trial , which got thrown out by the judge. Nobody in the courthouse was interested in talking to Darl today, according to my eyewitnesses, to the extent that they noticed, and they were looking.

Cody talked to him, though, after it was over. He asked him why he was there, and Darl said he just wanted to get a feel for it. Cody asked him what he thought about how it went, with IBM winning both motions. Darl said he expected it. Cody rode in the elevator with IBM's Marriott and asked him how he felt about how things went. Marriott said, "We're happy. Everything went as we'd planned. We're happy with the decision."

For IBM, it was David Marriott and Todd M. Shaughnessy. There were about 15 people there sitting in the gallery, including one woman, who rumor had it might be the patent attorney SCO hired and mentioned as possibly having a conflict of interest. But that is only a rumor.

The room was small, with maybe seats in the gallery for about 20 people, but no one was denied entrance. There were seats available.

Cody says that when the judge entered, she told them that it was her inclination to grant IBM's motions, and then she let both sides speak. First, SCO's Keven McBride spoke for about 40 minutes. The judge interrupted a few times and to Cody, it seemed like the presentation was hard to follow. Basically, he was arguing that IBM should hand over code first, so SCO could go over it and then categorize the violations as to whether they were copyright violations, trade secret, etc. Then Marriott spoke for IBM. He spoke for only 20 minutes. Cody described it as clear, crisp, easy to follow, easy to understand. He cited a case, Xerox Corp. v. International Business Machines Corp., he believes, which you can find mentioned here, in footnote 3 of IBM's Memorandum in Opposition to SCO's Motion to Compel Discovery, where the judge ruled like this:

"[3] See also Xerox Corp. v. International Business Machines Corp., 64 F.R.D. 367, 371 (S.D.N.Y., 1974) ('[Plaintiff] should be able to identify in detail the trade secrets and confidential information alleged to have been misappropriated by [defendant]. Clearly until this is done, neither the court nor the parties can know, with any degree of certainty, whether discovery is relevant or not; and it is doubtful whether [plaintiff] can undertake a meaningful discovery program'.)"

The hearing lasted an hour and a half.

Frank Sorenson was there too and he also reports similarly:

"Judge Wells came into the courtroom, and announced that she had read all the filings and the relevant case law, and it was her intention to grant IBM's Motions and postpone any further Discovery until this matter was cleared up. SCO was then given a chance to try to convince her otherwise. Kevin McBride (who turns out to be Darl's brother) argued for SCO, and pretty much rambled for maybe 40 minutes.

"David Marriott then argued for IBM, and did a way better job, and did it all in 15-20 minutes!

"A little more back and forth, and Judge Wells ruled. IBM will prepare an order before next Wednesday, and SCO will get 30 days after that to satisfy interrogatories 1, 2, 4, 12, and 13. A follow-up hearing is set for January 23rd."

Here are Cody's notes so far. He cautions that his notes are a summary of what occurred in the courtroom from his perspective. There are gaps and some truncated dialog, as happens when you are scribbling as fast as you can. We will have more from Frank shortly and a complete transcript eventually. Here are the court minutes.

*************************************************

Judge: Intention is to grant IBM's motion to compel delivery (interrogatives 12 and 13) . Plaintiff to file responses within 30 days. Postpone discovery until compliance achieved. There is a protective order in place.

K. McBride: Would like to put motion on hold until specific discovery is covered.

Judge: There is a circular pattern going on in discovery.

K. McBride: Wants to convince the Judge that specific discovery should be entered. This case is basically about infringement. There needs to be a clear definition of what source code infringes on Copyright law, trade secret law, and contract violations. Cites case of Sun vs. Microsoft where Microsoft misappropriated derivative works. Microsoft made changes to Java. This is about the derivative works. SCO acknowledges that IBM owns the derivative works but there is a contact in place on what can be done with it.

Continues with an explanation of Unix. Describes Unix and the preferred OS for large corporations. Unix was licensed to large software vendors like IBM and HP. The license stipulated what the software could be used for. SCO needs to know what IBM put into Linux whether it violated Copyright, trade secret or confidential information. SCO needs to see source code, development methods, developer notes related to the Unix derivative AIX.

Linux is undermining Unix, and SCO does not know what it is IBM contributed into Linux. What IBM has indicated to the public is they have contributed to Linux and SCO wants to know what it is they are referring to.

Judge: SCO has also made comments in public about what SCO would show in court. The idea is to prove why/why not compel discovery

K. McBride: We will comply with interrogatives 12 and 13 if the Court wishes but would like to focus on interrogatives 1,2,4. SCO wants all development notes, source code, etc on AIX then they can compare and see what the violations are.

Judge: Reference to a case with Utah Medical Products and another with Lukadia (Sp). Something about knowing what is relevant to future discovery.

K. McBride: SCO has to distinguish what code violations is part of copyright, contract, or trade secret law. Has to see what IBM has included. Will be filing a copyright infringement case in a few weeks.

Continues on with a characterization of Unix-Ware,Unix on Intel. Explanation of the Monterrey project and the sharing of SCO technology with IBM for Unix on Linux OS.

Judge: Has SCO shown what secrets were stolen?

Marriott: Has not.

[begins his turn] I will show that 1. Information about Operating Systems and source code 2. Why Judge's preliminary decision is correct 3. Shortcomings of SCO's discovery.

Points out that Plaintiff has distributed Linux for a long time. States that the crux of argument is in paragraph 101 of the case. Marriott hands out two books one book is thick (800+ pages) and the other is thinner (300+ pages). The thick book is print out of a file from the 2.5 Linux. The thin book is a print out from a file from AIX. Using the books he says that IBM has been accused of taking code from the small private book and putting it into the large public book, but won't say what code is in question. SCO has so far just handed IBM the small book and said the volitions are in there.

Citing a Xerox case an one other the burden of proof is places on the Plaintiff. SCO has not identified specifically on Unix file in question. Nor have they identified one single file in Linux that is in question. SCO has been touting the existence of evidence but has not shown any. SCO executives have repeatedly said in the media there is evidence of violations but IBM has not seen the evidence.

SCO has not even shown IBM the apparent evidence SCO has shown to the rest of the world under NDA. SCO is even going after other companies that use Linux. SCO is accusing Linux users of violations when they haven't even shown IBM what the Linux violations are.

K. McBride: SCO must see the AIX derivative works to clarify what law applies to the violations. The evidence that SCO executives are talking about is contributions of SysV code to Linux by SGI. IBM has put Dynix code and derivative code into Linux and SCO wants to see it. SCO has produced 100 more CDs than IBM has during discovery. SCO wants IBM to produce all Dynix and AIX code to derive evidence.

Marriott: IBM can produce the Dynix code and did so as of yesterday. IBM can also produce the derivative code, but IBM will not, unless compelled to, provide all 40 million lines of AIX code.

K. McBride: We want all 40 million lines of code. We will give it to our experts so they can digest it.

Marriott: Because Linux is open to the public you can go on to the Internet to any number of sites and look up the offending code.

Judge: The initial order is appropriate. Will grant IBM motion to compel both interrogatives 12 and 13. SCO must file response in 30 days. SCO must file affidavit if they cannot respond. SCO is to correct deficiencies in affidavit filed 11/4/2003. Does Mr. K. McBride want IBM to indicate which files they want from SCO?

Marriott: We want what SCO has said 5 months ago they were going to give us. There is nothing new here on what we need.

Judge: All discovery will be postponed until SCO has responded to IBM. Next hearing 1/23/2004 at 10:00 is all motions are addressed. Will not rule on SCO' s motions. Will address them in January if SCO has completed motions

K. McBride: Can we have that date put on hold if we need more time.

Judge: I will hold you to the 30 days but the hearing date can be changed.

UPDATE:

Here is Frank Sorenson's report, and it's as close to a transcript as we can have until the actual transcript is available from the court. They take a week. Then should give it to us. We'd have it done in a day. The best quotation: David Marriott, the attorney for IBM: "We don't think they had any evidence at the time they filed the case and we don't think they have any evidence now." This report greatly clarifies details of what the case is about. Note, for example, SCO says the trade secrets issues they have stem only from Project Moneterey. Here is Frank's report, first his introduction and then the blow-by-blow:

************************************************

This write-up is the combined result of the notes of Evan McNabb and Frank and Elizabeth Sorenson. We also got some notes and a chart from Mark Belnap, and Stuart Jansen helped in typing everything up. We have requested a transcript, but the court reporter said it may take a week or so before it will be available (we'll get it the same time that the lawyers do). We wrote down everything we could, and have attempted to give a general play-by-play of what happened during the hearing. Most of the wording is approximate, but when in quotes, we're pretty sure we got it word-for-word. Stuff in brackets either gives a description of what is happening or the gist of what someone said.

Judge Wells has a very small courtroom, and can accommodate approximately 20 people in the audience. About 15 people were present in the audience, including the court security officer. Before the hearing began, members of the audience chatted a little, and realized that most of us were local Linux users (vim won the quick-poll).

The SCO lawyers came in at about 9:50, and sat at the Defendant's table (left). Judge Wells' Courtroom Deputy asked them to move to the correct table (right). SCO's attorneys were Kevin McBride (Darl McBride's brother) and Brent Hatch (who wore a light suit and Christmas bowtie). Darl McBride (who arrived just before the door was closed) sat immediately behind them with another attorney (we think) whose name we missed. He had no bodyguards (unless that was who we thought was the lawyer).

IBM's lawyers appeared at about 9:57, and David Marriott and Todd Shaughnessy sat at the table. Amy Sorenson [no relation] was also present, but sat on the back row of the courtroom.

As each party entered, they checked in with the courtroom deputy, Amy Pehrson, who also asked who would be speaking for each side. Kevin McBride spoke for SCO, and David Marriott spoke for IBM. Also present was some sort of intern or assistant to Judge Wells (She jokingly referred to him as the brains), and she also made sure that he had copies of all the documents. There was a court reporter present, and she was nice and friendly, and helped us figure out how to get a transcript. At 10am, the deputy asked if everyone was present from both parties (yes), then went into Judge Wells' chambers. She emerged shortly, commanded "All rise!", and the judge came in.


Judge: I have reviewed all of the memorandums, including the most recent filings, and am up to date. [Note: We stopped by the Court Clerk's office on the way out for copies of the most recent filings, and the file was in Judge Wells' chambers--she really was up-to-date. ] After reviewing everything, my intention for the day is to grant IBM's motion, and to require SCO to file responses within 30 days, or to require SCO to file affidavits as to why they couldn't respond. IBM's responses should correct deficiencies to the 11/4 Addendum to include Interrogatories 12 & 13. I'd like to postpone any other discovery until this has been done. [Checked with both attorneys to make sure there was a protective order in place.] I am willing to hear arguments from both sides for or against proposed intention. [Asked who wanted to go first.]

K. McBride: [Offers to start.]

Marriot: [Agrees.]

K. McBride: May I have a few minutes to convince you otherwise? Because the issues are complex, and we want to suggest a more appropriate path, put the motion on hold until a specific discovery is produced.

Judge: It appears that "what is happening is somewhat circular." Seems to be failure to confer under rule 37. [Note: Rule 37 says you have made good faith efforts to obtain complete responses to the interrogatories without court action, but have been unable to do so.] We can't get off the ground until we get started.

K. McBride: What really should happen is specific discovery should be identified and then we will reply with our discovery. The case at the fundamental level is infringement. We need a clear definition of "what source code is at issue" before discussing types of infringement. "This is a complex case, your honor." [NOTE: He pointed out a number of times that this was a complex case. In case any of us missed it the first and second times.] There was some contract disputes, some copyright disputes, and some of neither. This is the frontier of interaction between copyright and contract law. [Cited Sun v. Microsoft, 1999 in 9th circuit court handed out copy of material related to case.] "Some paragraphs are worth reading." Microsoft made changes and distributed Java. The case is about interaction of copyright and contract law. [ Pulled out big chart and asked for permission to display it. Mark Belnap later copied this chart down, and we have tried to recreate it here]

Judge: "If you can find a place to put it, go for it." [Invited IBM to come behind the bench to see chart if necessary.] "My court room is spatially challenged."

K. McBride: [Gives small copies of chart to IBM lawyers]

K. McBride: I will give a background of licensing issues between the two companies. This case "involves the genesis of computer software for large corporations." All corporations use Unix at the Fortune 1000 level and have used it for over 20 years. AT&T started Unix and licensed multiple parties to modify it. SCO acquired all the rights to Unix. "SCO is in the shoes of AT&T." IBM had a special license, but Sequent had a standard license. There was a scope clause in the license limiting what you could use the software for. You could use it and modify it, provided it was treated as part of the original software product. IBM is obligated to maintain some kind of confidentiality under some kind of law, whether copyright, contract, or trade secrets. [NOTE: The level of specificity is McBride's, not ours.] Do we have a copyright case? A trade secret case? [NOTE: somewhat rhetorical] They can't step out of making money with it. "You can't use your stuff in violation of our license." We have no problem saying that AIX is IBM's, they just can't use it in violation of our contract. [NOTE: he did specifically state several times that they acknowledge that AIX belongs to IBM]

We need to identify first all this stuff IBM put into Linux. We know that IBM gave away source code, development methods, and sequences into Linux. "We don't have issue with the non-infringing part of Linux." "We're not making it up new." IBM did contribute stuff to Linux, "we just don't know what it is." Linux is undermining the entire Unix operating system market. We know IBM contributed stuff because they boasted about their contributions in the press.

Judge: "It isn't just IBM making public statements is it?" My concern is, I want to focus back on the question of motion to compel.

K. McBride: I'll hurry up. [Starts reading IBM quotes so fast the court reporter had to ask him to slow down. Quotes IBM about donating to Linux and making it as strong as Linux.] We're happy to live with what they've said and what we've said. Specifically addresses interrogatories 12 and 13. IBM's interrogatory 12 is not a part of the case to us, but if they court wants us to, we'll do it. For IBM's interrogatories 1, 2, and 4, we need IBM to produce all versions and developer notes for AIX. Then we can compare and make very clear specification about what contributions and what kinds. Staying discovery would do tremendous injustice and keep us from explaining to the court what's what and why.

Judge: So, tell me why [she mentions two particular cases IBM brought up in their Memoranda ] don't apply to this case. These cases say that the burden of proof is on the plaintiff. What is relevant to future discovery? "None of us know!"

K. McBride: Neither of these cases address our specific facts. We won't know what is trade secrets and what is contract and what is copyright until we see IBM's discovery. We will file a second amended complaint regarding copyrights within the week.

Our trade secrets claims come from the joint development starting in 1997 time frame, Project Monterey. [History of RISC and Intel platforms, no one was focusing on Intel except SCO, who spent 16 months making Unix work on Intel.] IBM was left out in the cold without an operating system they could sell as Intel chips got big. In Project Monterey, we we gave them our stuff, trade secrets stuff, and they did Linux at the same time secretly, and then stepped out of Monterey and used our stuff. We've given everything to them, all of our knowledge and trade secrets. They have the code.

Judge: What about the pages in non-machine-readable format?

K. McBride: We gave them all our source code.

Judge: But did you give it to them in 100,000's of pages of unusable text?

K. McBride: "You have to have discovery of the universe" and then we can figure stuff out.

Judge: [Turns the time over to IBM's attorneys]

D. Marriott: I will cover three issues: 1) operating system and source code background; 2) what is at issue, proposed ruling is great; 3) some examples of shortcomings of SCO Group's Responses to Interrogatories.

Without software, a computer is a lump of metal. You take source code, put it through a compiler, get out 1's and 0's. [Gives the judge, assistant, and SCO's attorneys a booklet with all of his supplementary material for his arguments.] One of the pages shows an example of source code, comments in red and code in black. "Unix is a family of operating systems." Linux is also an operating system. Only Linux is developed publicly, as a "massive collaborative exercise". [explains Linux development process, and shows diagram from book--we think it is the diagram Linus and Andrew Morton presented here, and which was discussed here on Groklaw.]

Show [from the book] an example email submission to Linux by an employee of SCO. SCO began in 1994 as a Linux distributor, contributed to Linux. The Crux of SCO's case is paragraph 101 [in book--we think he is referring to SCO's amended complaint].

[Holds up 2 books, one with about 200 pages in it and the other with about 500 pages. Gives copies to Judge, assistant, and SCO. McBride jokes as he gets his copy, "Is this AIX you're finally producing?"] The little book represents Unix source code, the large book represents a single file of Linux source code. They are claiming that we took some of this [little book] and put it in this [big book]. [Talked for a bit about the 2 books (each book represents a chapter of a larger book, which represents a single version of Linux or Unix). He compares sizes, subtley pointing out how silly the claim sounds. Pointed out that SCO still has not said what parts of small book IBM supposedly put in which parts of big book.] We don't even know what book [version], chapter, or file of Unix we're talking about. We don't know what book [version], chapter, or file of Linux we're talking about. [He mentions that the physical book he's holding up (the bigger, Linux book) actually contains the printout of a single file from a single version of Linux.] This file has 31597 lines, and comes from Linux 2.5.69 [include/asm-ia64/sn/sn2/shub_mmr.h fits this description].

In order to file the complaint, SCO had to have what they say they have. Case law says a party may not dump information on a party and expect them to extract relevant information. Actually, many cases that say that. We moved to compel after waiting 4 months, then got some supplemental responses that are still inadequate. There are 14,548 chapters [files] in Unix, millions of lines of code, and we don't know which lines they say we misappropriated.

It is not just IBM that has a problem with this. They are also accusing Linux users. This is like stopping someone walking out of Barnes and Noble who just bought a Linux book and saying, that book holds our stuff, now you have to pay us in order to keep the book.

[Talks about how SCO has shown stuff to other people under an NDA. ] "We shouldn't need an NDA. We have a protective order."

The only case that SCO quotes actually doesn't contradict our case examples. It is a copyright case which, as of now, SCO hasn't accused us of yet.

"We don't think they had any evidence at the time they filed the case and we don't think they have any evidence now." "No reasonable person could conclude that SCO has" stated their claims with specificity.

K. McBride: "There is no trade secret in Unix System 5. Copyright yes." "There are trade secrets in UnixWare... that was given to IBM in the joint development project."

"Confidential information is not a trade secret."

These are the most recent CD's produced from both us and IBM [holds up 2 CD-R's ]. Ours is numbered 122, and theirs is only numbered 21. I guess we just got 22 and 23 today, but we've produced 100 more CDs than they have. IBM should be ordered to give us AIX and Dynix, then we can make more concrete allegations after 30 days.

Marriott: We have agreed to give AIX and Dynix, just not every iteration. That would be 40 million pages.

K. McBride: "We want the 40 million pages!"

Judge: "And you will digest them by Sunday?"

K. McBride: We have expert analysts who can go through it [they want 30 days to go over the code].

D. Marriott: [closing remarks] Linux is an open development model, and Her Honor can go online and see it being developed at any time.

Judge: Okay, this is my ruling, it is essential to get the ball rolling. My initial ruling stands. At this time, I will grant IBM's Motion to Compel both sets of interrogatories. IBM is to add Interrorgatories 12 and 13 to the listed deficiencies. SCO will have 30 days after the ruling is recorded to comply. If they can't in good faith, they should file affidavits as to why they cannot.

IBM should correct the deficiences in their addendum filed Nov 4th [to add interrogatories 12 & 13]. [Marriott needs to get the complete list of missing/incomplete stuff to McBride.] All other discovery is postponed. By Wednesday of next week, IBM should submit the order, then SCO has 30 days, and then let's have a hearing about 2 weeks after that, around mid January.

[discussing of timing, etc. Judge was willing to give more time, after the 30 days was up for briefings, but not more than 30 days to comply. Hearing set for 23 January at 10am] Address remaining motions of SCO's with the assumption that SCO has completed discovery with the required specificity. She is not ruling on SCO's motion at this time.


Some notes: Our general feeling is that McBride was choppy, chaotic, and random in his speaking. It felt like he was running a filibuster. IBM was direct and to the point in everything they said and did. They were prepared every time that the judge asked them a question and appeared to be right on top of everything that was going on. SCO presented exhibits to the court that were copied and stapled. IBM's exhibits and other documents had simple comb bindings and looked more professional.

When McBride was speaking, he wandered around the courtroom and seemed to be talking off the top of his head. Marriott stood at the lectern and seemed to be working from well-prepared notes that he had practiced. We enjoyed listening to his arguments.

Judge Wells seemed to have little patience for the filibuster She stated that the proceedings needed to conclude before noon (probably lunchtime!), but with both sides having a chance to state their case. She interrupted McBride several times to help focus him back on the point of the hearing. She was very fair and direct. She gave McBride every chance to convince her that she should not grant IBM's motions. She brought up several points that weren't directly addressed during arguments, indicating that she had read and absorbed the material, and noticed some of SCO's antics. She especially did not seem impressed about handing over the code on paper, rather than in a useable format. McBride remarked that he believed they had resolved that problem.

After the hearing, Darl turned around and recognized Evan from the protest. Darl said that he wasn't surprised about what happened, but it was what they had expected. We later shook hands with the IBM lawyers. They "like to keep up with what's going on" [partially referring to Groklaw].


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