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Final Judgment in SCO v. Novell: SCO Loses Again
Thursday, November 20 2008 @ 08:36 PM EST

The final judgment [PDF] from Utah is here at last. It recites what the August 10, 2007 and July 16, 2008 orders said, but it also resolves the recent dispute over SCO's desire to voluntarily waive some claims and then bring them back to the table after an appeal, should it prove successful. Here's SCO's motion to voluntarily dismiss, and Novell's response, so you can verify that this judgment indeed represents another loss for SCO. You'll see that it was Novell that suggested the wording regarding SCO's voluntarily dismissed claims that we see in the judgment, that they be dismissed "without the possibility of renewal following appeal."

SCO caved on its voluntarily dismissed claims, then, and Novell did not. So, another loss for SCO. No matter what happens on appeal, then, SCO can't resurrect those claims. It can appeal the rest of the matters it lost in August 2007 and July of 2008.

Novell, however, in an identical circumstance, can pull its voluntarily dismissed claims out of its back pocket and go after SCO. And I'm sure it would. In the wording of the judgment, Novell has "the right to pursue these claims only in this action, should there be a subsequent adjudication or trial in this action." So if there were an appeal and SCO got the case sent back to Utah for a jury trial, for example, SCO's favorite daydream, then Novell could bring back to the courtroom all its voluntarily dismissed claims.

Here, in contrast, is the wording on the SCO claims from the judgment:

3. The remaining portions of SCO's claims for Breach of Contract (Count II), Copyright Infringement(Count IV), and Unfair Competition (Count V) are voluntarily dismissed with prejudice, without the possibility of renewal following appeal.
So, all the tricky language SCO suggested to the judge was for naught. Whew.

Here's the docket entry:
11/20/2008 565 - FINAL JUDGMENT in favor of Novell, Inc., SCO Group and also against Novell, Inc., SCO Group. Case Closed. Magistrate Judge Brooke C. Wells no longer assigned to case. See Judgment for details. Signed by Judge Dale A. Kimball on 11/20/08. (ce) (Entered: 11/20/2008)
Now it's on to an appeal, if SCO can afford it, I suppose. As SCO's lawyer, Arthur Spector, told the court at the September hearing in the bankruptcy, that could take a year and a half or it could take five.

Of course, Novell could appeal also, independent of SCO, and it might decide to, in some alternate universe where companies throw away a hard-won victory. I guess they could appeal the amount they won, trying to get it higher, or Novell might want to appeal the judgment from July that SCO had the right to enter into the Microsoft and SCOsource end user licenses. I know I would like them to. If SCO appeals, then I think Novell might just go ahead. If not, who'd blame them for wanting to forget they ever met anybody called SCO?

If it were me, I'd decide based on whether I thought SCO was going to get new funding. If they did, I'd go ahead and appeal, because otherwise whoever buys up the litigation or backs it could restart SCOsource. I think that's what all the delay in bankruptcy has been about, actually. SCO isn't so keen on showing its hand, I'd imagine.

Anyway, after the lull in SCO news, for sure it's going to get really interesting again pronto.

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

IN THE UNITED STATES DISTRICT COURT
DISTRICT OF UTAH, CENTRAL DIVISION

_______________________

THE SCO GROUP, INC., a Delaware

corporation,

Plaintiff and Counterclaim-
Defendant,

v.

NOVELL, INC., a Delaware corporation,

Defendant and Counterclaim-
Plaintiff.

____________________

FINAL JUDGMENT

Case No. 2:04CV00139

Judge Dale A. Kimball

____________________

Whereas by Memorandum Decision and Order dated August 10, 2007, the Court having ruled on the parties' summary judgment motions, and the matter having come before the Court for trial on April 29 and 30 and May 1 and 2, 2008, and the Court having issued its Findings of Fact, Conclusions of Law, and Order dated July 16, 2008, and the parties having stipulated or moved to dismiss the claims remaining after the foregoing Orders, and the Court having considered the submissions of the parties concerning the entry of Final Judgment, and good cause appearing, it is ORDERED, ADJUDGED, AND DECREED that:

1. SCO's claims for Slander of Title (Count I) and Specific Performance (Count III) are dismissed pursuant to the Court's Memorandum Decision and Order dated August 10, 2007.

2. SCO's claims for Breach of Contract (Count II), Copyright Infringement (Count IV), and Unfair Competition (Count V) are dismissed pursuant to the Court's Memorandum Decision and Order dated August 10, 2007, insofar as these claims are based on ownership of pre-APA UNIX and UnixWare copyrights.

3. The remaining portions of SCO's claims for Breach of Contract (Count II), Copyright Infringement (Count IV), and Unfair Competition (Count V) are voluntarily dismissed with prejudice, without the possibility of renewal following appeal.

4. With respect to Novell's claims for Declaratory Relief (Count IV), pursuant to the Court's Memorandum Decision and Order dated August 10, 2007, Novell is entitled to direct SCO to waive claims against IBM, Sequent, and other SVRX licensees; Novell is entitled to waive such claims on SCO's behalf; and SCO is obligated to recognize such a waiver. In addition, pursuant to the Court's Findings of Fact, Conclusions of Law, and Order dated July 16, 2008, SCO was not authorized under the APA to amend, in the 2003 Sun Agreement, Sun's 1994 SVRX buyout agreement with Novell, and SCO needed to obtain Novell's approval before entering into the amendment; but SCO was fully authorized under the APA to enter into the 2003 Microsoft Agreement and the SCOsource Agreements with Linux end-users without any approval by Novell.

5. With respect to Novell's claims for Constructive Trust/Restitution/Unjust Enrichment (Count VI), Breach of Fiduciary Duty (Count VII), and Conversion (Count VIII), pursuant to the Court's Findings of Fact, Conclusions of Law, and Order dated July 16, 2008, Judgment is hereby entered in favor of Novell for $2,547,817, for the revenues from the 2003 Sun Agreement attributable to the unauthorized amendment of the SVRX confidentiality provisions in Sun's 1994 SVRX buyout agreement with Novell. Pursuant to the parties' agreement reflected in Novell's Unopposed Submission Regarding Prejudgment Interest dated August 29, 2008, that award is increased by $918,122 in prejudgment interest through August 29, 2008, plus $489 per diem thereafter until the date of this Judgment.

6. Further with respect to Novell's claim for a Constructive Trust (Count VI), as reported in Novell's Submission Regarding the Entry of Final Judgment dated August 29, 2008, the parties have reached an agreement as to the amount of the constructive trust ($625,486.90), and the parties will be reporting that amount to the Bankruptcy Court in the related bankruptcy proceeding, if they have not already done so.

7. Novell's claim for Accounting (Count IX) is mooted by the Court's Memorandum Decision and Order dated August 10, 2007.

8. Pursuant to the parties' Joint Statement dated August 17, 2007, and Supplemental Joint Statement dated August 24, 2007, Novell's claims for Slander of Title (Count I), Breach of Contract (Count II), and Declaratory Relief (Count V) are voluntarily dismissed, with the right to pursue these claims only in this action, should there be a subsequent adjudication or trial in this action.

9. Pursuant to the Court's Order dated September 7, 2007, granting Novell's Motion to Voluntarily Dismiss Its Third Claim for Relief dated August 24, 2007, Novell's claim for Breach of Contract (Count III) is voluntarily dismissed, with the right to pursue this claim only in this action, should there be a subsequent adjudication or trial in this action.

DATED this 20th Day of November, 2008

BY THE COURT:

___[signature]___
Judge Dale A. Kimball
United States District Court Judge


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