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SCO Bankruptcy: SCO Withdraws Motion Re Confidentiality
Thursday, November 20 2008 @ 07:44 AM EST

SCO has withdrawn its "Motion of the Debtors for an Order Providing that Creditors' Committees are not Authorized or Required to Provide Access to Confidential Information of the Debtors or to Privileged Information", which it filed in September of 2007, when it first filed for Chapter 11 bankruptcy protection.

Remember that? They filed it back when SCO thought someone might care enough to actually form a creditors' committee. But since that never happened -- the top 20 unsecured creditors (SCO Group's and SCO Operation's list, PDFs) being mainly friends and allies of SCO -- it obviates the need to protect SCO's secrets from any such committee. There was supposed to be a hearing on that back in October of 2007, but that never happened, and so now for some unknown reason, they are clearing it off the docket.

Here's the wording of the Notice of Withdrawal [PDF]:

PLEASE TAKE NOTICE that The SCO Group, Inc., et al., the debtors in possession (the "Debtors") in the above-captioned chapter 11 cases, hereby WITHDRAW, without prejudice, its Motion of the Debtors for an Order Providing that Creditors' Committees Are Not Authorized or Required to Provide Access to Confidential Information of the Debtors or to Privileged Information (Docket No. 11).
Without prejudice. Lovely SCO touch. If a creditors committee is suddenly formed, SCO is ready. Why now? I'm only guessing but probably they are tying off loose ends, because their time to file a reorganization plan is almost up. And despite investors being "so excited about the business prospects of working with SCO" that Stephen Norris mentioned at SCO's Tec Forum, so far nothing in writing to file with the court, so it does begin to look like the clock may run out first. What a surprise. Look for a December 31st filing. Oh, wait. SCO shuts down for Christmas, I seem to recall, and recovers slowly. They are "officially" closed from December 24th until January 1st, so I'm thinking we might look for something by the 24th, unless SCO's participation isn't required to file later.

If you recall, the judge gave SCO extra time to file a plan exclusively, until the end of the year. Here's the order [PDF] on that. The idea was to give them time to negotiate with investors, starting from the date in July when the Utah court made a decision on what SCO owes Novell.

In reviewing the transcript of that September hearing, I noticed a detail I hadn't noticed before. SCO's attorney, Arthur Spector, when arguing in favor of more time to file, mentioned that Novell would have to spend millions on an appeal to get the $3 million the Utah court ruled SCO owes them:

Why do you care if we have another few months? It's not like -- it's not like you're counting on us having that money today that we're squandering it tomorrow. This is Novell. This is a -- a three and a half million dollar judgment that they'll eventually get, that they'll have to fight millions of dollars in appeals to get to!

Lovely attitude. I guess the life lesson for Novell is don't do business with SCOfolk whereby SCO is in a fiduciary relationship with you. They keep your money and then make you fight for it. SCO did try to hold back on paying immediately even the amount of interest on what the court ordered, the amount the parties even agreed to put in the constructive trust, and then Novell filed a motion asking the bankruptcy court to make SCO pay right away. There was some back and forth between the lawyers for both sides about the constructive trust monies, and the latest word is that a settlement has been reached, but until they file the actual paperwork, we don't know what the settlement is. I'm assuming that Novell gets paid the interest at least on what SCO owes Novell, but the full payment is the part Spector is talking about. So, life lessons. Might that be part of why SCO seems to find it so hard to find new partners? You think?

Also Berger Singerman filed its quarterly application for compensation, but we've seen all those bills before. In the old days, I'd have compared them with the filings, just to be sure, but as Dylan put it in his song, I used to care, but things have changed.

Kidding. I still care. But bankruptcy court is not likely to.

Here are the documents:

11/18/2008 - 609 - Quarterly Application for Compensation [Fourth] and Reimbursement of Expenses as Co-Counsel to the Debtors in Possession for the Period from July 1, 2008 through September 30, 2008 Filed by Berger Singerman, P.A.. Objections due by 12/8/2008. (Attachments: # 1 Notice # 2 Exhibit A # 3 Exhibit B # 4 Exhibit C # 5 Certificate of Service and Service List - Fee App# 6 Certificate of Service and Service List - Notice only) (Makowski, Kathleen) (Entered: 11/18/2008)

11/19/2008 - 610 Affidavit/Declaration of Service for service of the Notice of Agenda of Matters Scheduled for Hearing Filed by The SCO Group, Inc.. Hearing scheduled for 11/20/2008 at 09:30 AM at US Bankruptcy (related document(s) 608 ) Filed by The SCO Group, Inc.. (Makowski, Kathleen) (Entered: 11/19/2008)

11/19/2008 - 611 - Notice of Withdrawal of Motion of the Debtors for an Order Providing that Creditors' Committees are not Authorized or Required to Provide Access to Confidential Information of the Debtors or to Privileged Information (related document(s) 11 ) Filed by The SCO Group, Inc.. (Attachments: # 1 Certificate of Service and Service List) (Makowski, Kathleen) (Entered: 11/19/2008)


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