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The Truth About Compuware v. IBM
Sunday, October 24 2004 @ 02:19 AM EDT

Maureen O'Gara on October 4 "reported" that IBM was "smacked up side the head by the District Court for Eastern Michigan for 'gross negligence' in the way it repeatedly swore - under oath - that source code sought as part of court-ordered discovery by Compuware, which is suing IBM for software piracy - flat out didn't exist - only to be found - IBM lawyers said - 'in a closet' in Australia after discovery had closed and the case was about to be heard."

Then yesterday, she added this:

"Makes one wonders whether IBM looked in that closet in Australia where it said a few weeks ago it just happened to stumble over the source code - the source code it swore - literally swore in court for two years - didn't exist - the code that it was supposed to produce during the court-ordered discovery phase of the suit that Compuware brought against IBM for, well, for stealing its source code.

"IBM only managed to find the code after discovery had closed and the trial was about to start, a situation that it got its ears boxed for by the District Court for Eastern Michigan, which called its behavior 'gross negligence.'"

Makes one wonders, indeed. Well, as usual with Ms. O'Gara, it pays to be from Missouri. I have found the court documents, and as you will see, she doesn't tell the story quite the way it happened.

First, the court directly told IBM's attorney that it knew he would not lie to the court, so Ms. O'Gara's implication that the court did not believe IBM's account of what happened is not true. The court did criticize an IBM employee, who it said should have looked harder for the code. It said this employee was negligent, not IBM and not IBM's lawyers. The judge in no way indicated that IBM's lawyers were playing games. On the contrary. And he refused to order the sanctions that Compuware had asked for, saying they were too severe under the circumstances.

The circumstances are this: some early work on the code was done on a mainframe in Sydney, Australia. Later, everything was moved to a system in Perth, which is about as far away from Sydney as New York is from San Francisco. No one involved took any steps to preserve that early code, because it wasn't needed any more. Then the mainframe in Sydney was taken down and not used any more. The developers in Perth, once the lawsuit was filed, didn't think they had that pre-release early code. As a matter of fact, they didn't have it. As it turned out, someone in Sydney had put a backup on a tape with a lot of other things on it as well and stuck it in a closet there. Not knowing about the code backup, the Perth employee testified that they had no code to produce.

IBM found the backup code eventually, restored the tape, and voluntarily brought it forward in July. By the way, IBM says that the code proves Compuware has no case, so they logically might have wished to bring it forth sooner. Compuware asked the court to punish IBM by not allowing it to be used at trial, among other things, which is what I would expect a lawyer to ask for if code turns up that ruins his case. The judge said no, that IBM didn't deserve such severe sanctions. Sound like an ear boxing to you?

How do I know all this? Because I learned how to read. Instead of writing about cases off the top of my head or just parroting what some party to a case might say, I go and look. Now, I don't expect you to take what I say as necessarily being true either. Court documents are available to the public. We only need to go find them. So, since you are adults and can read and make up your own minds, here are the raw materials:

Here, for the lazy, is what the judge actually said in the hearing to IBM's attorney, Mr. Rafferty:

Judge: The costs for those re-depositions and for the expert to re-analyze that code is going to be born by IBM. I'm not willing -- Mr. Rafferty, I believe -- I have no reason to believe that you would lie to this Court.

I do think though, Mr. Turner clearly dropped the ball. I do think it's negligence, gross negligence probably. I think the sanction is pretty severe since -- would be rather severe that's being asked for though, under the circumstances if there's other remedies that I can fashion in this case for them to be able to prepare and that's what I'm doing in this case.

Let me tell you though, IBM better do -- if there's any other materials out there, I'm not going to be in this type of mood next time. Because there's no reason at this late of a date for Mr. Turner not to have found that material. And for him to say that it didn't exist, I find that somewhat outrageous. I'm bothered by that, very bothered by that.

IBM is going to pay the cost for this motion. They're going to pay the cost for the re-depositions of those experts and for the cost of the analysis on it. All right?

That's on page 19 of the transcript. I encourage you to read the entire transcript though, and then ask yourself: when you back up data on your computer, putting on CDs or floppies whatever you don't use any more and then removing it from the computer and putting it away on a regular basis in a drawer somewhere, do you find it easy to retrieve a particular file a couple of years later? That's just you, one person, in one location, with one computer. The judge, in my opinion, underestimated how hard it is to keep track of anything once it is no longer on the computer in a company as large as IBM.

You might also enjoy to read the judge's first words to the Compuware attorney, Daniel Johnson, because he doesn't sound so enamored of them either:

"Is every motion I get from you guys labeled emergency?"

And here is what the judge did *not* order, despite Compuware's pleas:

2. Plaintiff [Compuware]'s Motion for default judgment relating to Compuware's First Claim for Relief for Copyright Infringement and Second Claim for Relief for Trade Secret Misappropriation is DENIED.

3. Plaintiff's Motion for preclusion of File Manager pre-Version 1 code or any evidence of the contents of the development thereof is DENIED. Plaintiff's request for a jury instruction relating to the absence of File Manager pre-Version 1 code is DENIED.

4. Plaintiff's Motion for an order enjoining the sale, licensing, marketing, installation or other distribution of IBM's File Manager is DENIED.

This all happened in September, by the way. And now Compuware is complaining that the judge didn't sanction IBM. So which is it? They got smacked upside the head or they got off light? Here's what Compuware says in its motion, which will be heard, I believe, in November:

"Merely awarding the minimal costs (such as court reporter and copy charges) caused by IBM's discovery abuse, while forcing Compuware to pay the other expenses of the additional expert analysis and fact and expert discovery, would only compound the serious prejudice to Compuware and reward IBM for its discovery abuses. . . . and the Order should be modified to require IBM to pay all of Compuware's expenses caused by IBM's misconduct, including attorneys' and expert fees related to the motion, and attorneys' and expert fees for the additional fact discovery, expert discovery and expert analysis made necessary by IBM's failure obey the Court's orders.

I think I may safely say that having to pay for the court reporter is not exactly being smacked upside the head. Why is Compuware putting out press releases about it almost a month later? You tell me. Ms. O'Gara says it is warming the cockles of SCO's heart, or some such, but I believe I may safely say that can't be correct, since I've seen no evidence that SCO has a heart. Anyway, now you know the rest of the story.

Now, why would Ms. O'Gara keep writing about this case in connection with SCO? Perhaps it gives us a hint that we should look a bit closer for some connection? Why, knock me over with a feather. The lawyers for Compuware include two familiar figures. One is Daniel Johnson, who appears in the transcript, and who worked with David Boies on the Napster case. Another, listed on the court documents, is Stuart Meyer, and they are both with Fenwick and West. My, that sounds familiar, doesn't it? It should. He's been interviewed often enough about the SCO case, including this one entitled "SCO and Linux: The Legal Rights and Wrongs", without happening to mention that he is also representing a client suing IBM for copyright infringement. He also worked on the Napster case. Small world.

So, just at the very point in time that SCO is trying to persuade the judge and the world that IBM is trying to hide something in discovery, up pops this Compuware story, spin and all, all about IBM allegedly being grossly negligent and playing games in discovery.

What a coincidence.

Except that isn't what happened at all, not by my reading of the transcript. I encourage you to read it for yourselves, and the next time an impartial expert shows up with an opinion on the SCO case, ask yourself if there might be an angle. Do some research. Then make up your mind.

Here are some more links on Fenwick and West and another example of Mr. Meyer on SCO:

Assuming that SCO's claims have merit, where does the liability lie? Is it with the companies that distribute Linux software, the hardware makers like HP and IBM that sell Linux with their gear, or is it with customers who run Linux?

"Potentially, it could lie with a number of different parties. Under intellectual property laws, you can be liable if you are either a direct infringer or if you either induce someone else to infringe or do something that contributes to infringement by someone else. The answer could be 'all of the above,' theoretically.

Would companies have to have known that they were infringing to be liable?

"Not necessarily. There is also a knot in some areas of intellectual property that you can be infringing and have 'innocence of heart.' In patent law, for example, you cannot even know that a patent exists--and just by coincidence come up with a similar invention and be held liable for infringement. In copyright law, you have to actually copy the work, but it could be (akin to) copying a song you had heard before. George Harrison found that out the hard way.

Most people in the open-source community downplay the SCO suit as frivolous. Do you take it seriously?

"It's important to take any allegations of intellectual property infringement or misappropriation seriously. What that means is that you can't just rely on some offhand comment about it not being serious and move on. You really do have to have somebody look into it and decide for your own company what the ramifications are." "Many times, I run into people who say I can't believe someone has a patent on this or that. A couple of years later, they wind up in court. Don't read an article and decide based on that that something's not worth your time. It's very dangerous to declare something frivolous, because strange things happen in court. You have to be prepared for those."

Oooh. Scary stuff, huh? I dare say anyone reading those words might be inspired to run right out and buy a SCOsource license, just to be on the safe side.

And here are several more news accounts of the Compuware story, ones that at least let IBM comment about what it calls Compuware's "misrepresentations".

Sometimes people criticize Groklaw for having a point of view. At least you don't have to do 3 hours of research to find it. I tell you clearly what Groklaw stands for. If the other folks did the same and were up-front about their position, I think it would be a better world.


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