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To read comments to this article, go here
Monday's Agenda in SCO's Bankruptcy and the Letter from Russia - Updated with All the Exh. 1 Customer Letters
Thursday, June 11 2009 @ 03:40 PM EDT

We have now the Notice of Agenda of Matters Scheduled for Hearing, letting us know what is going forward at Monday's hearing in SCO's bankruptcy:
06/11/2009 - 799 - Notice of Agenda of Matters Scheduled for Hearing Filed by The SCO Group, Inc.. Hearing scheduled for 6/15/2009 at 02:00 PM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #3, Wilmington, Delaware. (Attachments: # 1 Certificate of Service and Service List) (Makowski, Kathleen) (Entered: 06/11/2009)
It will be the three motions to convert, the Trustee's, IBM's and Novell's, and the SCO motion to file under seal the Appendix to its Response to the three motions. So, 2 PM.

I was noticing something interesting in IBM's Reply to SCO's opposition to IBM's motion to convert SCO to Chapter 7. It has to do with the letters SCO attached as Exhibit 1 [PDF]. IBM takes note of those letters like this:
9. The customer letters in Exhibit 1 to the Debtors' Response are hearsay and inadmissible, and IBM intends to object to their consideration at the hearing on the Motions to Convert. (See Fed R. Ev. 802.) Even if they were admissible, however, they do not provide the unusual circumstances to establish that the requested conversion is not in the best interests of the creditors and the estate, nor do they establish a sufficient basis to support dismissal as the preferable alternative to conversion. The Debtors' argument that they should continue operations to protect their customers rather than their creditors, at the expense of what little cash remains in the estate for creditors, flies in the face of the purpose of Chapter 11. That the creditors have not objected is little surprise. As Congress recognized, creditors are often apathetic and uninvolved. That is one of the reasons Congress established the United States Trustee system, to act as a watchdog when creditors do not have sufficient interest to do so.6 The United States Trustee here has moved for conversion. Creditor apathy does not justify dissipating the remaining assets of the estate.
Hearsay. What might that mean in this context? One of the letters is from a gentlemen who is a CACI, Inc. contractor for the US Army, but at the bottom it says, "This letter is not meant to be an official CACI or Government endorsement of any product and is to be used to support SCO in submitting a customer summary to the bankruptcy judge only." So, it's not from the Army. It's not even from CACI in any official way.

Another letter is from someone at Business Console Ltd. in Moscow, whose major customer is Sberbank, or the Russian Savings Bank, "the largest bank in Russia". But it's not from Sberbank, is it? It's from "SCO's premier partner in Russia", Business Console. If Sberbank wanted to send a letter saying it can't live without SCO products, it could have. But that isn't what this is. It's a third party saying Sberbank needs them. A SCO partner, at that. That's about as weighty as SCO telling the court its customers need their products. Actually, less, because IBM claims it's hearsay and therefore inadmissible. I think that is what IBM is referencing.

Also, the letter is addressed to SCO, not to the court, and it asks SCO to work hard to get a reorganization confirmed, so as not to cause disruption to Sberbank. I assume that SCO and its premier partner in Russia did inform Sberbank before this deal was signed that the US District Court in Utah had ruled against SCO and in favor of Novell in that same month and year.

But I notice something else: the bank was already using OpenServer 5, if I've understood the letter accurately. The writer is not native English speaker, so I'm not positive, but that is how it reads to me, that they upgraded. Surely this partner of SCO knew there was litigation going on for years and years and years. How could Sberbank not know, if it was using SCO products? SCO sends out newsletters all the time. Why didn't they look into options long ago, then, so as to avoid interruption, if that is the concern? It's what analysts like Gartner suggested in 2003, actually, as I've pointed out before.

And there is no reason to assume no one will buy SCO'S OpenServer business and keep these customers smoothly sailing along, without SCO's litigation gamble hanging over their heads any longer. A Chapter 7 trustee can certainly sell the business to someone willing to buy it, can he not? He can use these letters to demonstrate value, I'd think.

If the letters aren't admissible, it doesn't matter, but what I'm thinking is that the letters aren't so helpful anyway, even if they were. Let's look at the letter from Russia now, in text, and I'll work on the rest of them and put them here as we get them done, and you'll find the complete Exhibit 1 beneath the double row of stars, now that IBM has stated it intends to raise them at the hearing as hearsay and therefore inadmissible:

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

*000 БИЗНЕС КОНСОЛЬ*
[Address and phone]

-------------------------------------------

The SCO Group Inc.
[address]
USA

Attn. Jeff Hunsaker, President and COO

Dear Mr Hunsaker,

Let me share our thoughts regarding SCO legal filings and prospects of your company's products usage.

Business Console Ltd. is SCO's premier partner in Russia. Our major customer Russian Savings Bank (Sberbank) is the largest bank in Russia with about 20.000 offices countrywide. The bank's most widely deployed application uses SCO Unix products family for about 10 years.

Sberbank considered alternatives to SCO platform in 2005 when they decided to replace then-current SCO OpenServer 5 yet after thorough evaluation and testing they favored SCO OpenServer 6 for its superior reliability, price/performance and well-established support.

The contract between SCO, Sberbank and Business Console covering software purchases and support was signed in October 2007. The bank purchased and installed SCO OpenServer 6 licences for about 2.500 servers since then. It was confirmed by Sberbank officials during recent meeting in March 2009 that the roll out will continue over years: about 15% of servers in operations become obsolete per year and replacement servers should be equipped with OpenServer 6.

As we have been informed, there is a potential move to put SCO under Chapter 7 (bankruptcy). We like to express, that this step would cause enormous problems for Sberbank and our company. The Bank would need the guarantee for further development and support on SCO OpenServer 6. Evaluating alternative solutions as well as porting the application software counting millions lines of code and rolling out an alternative solution would mean men years of work and high associated costs. This would be a heavy impact to Sberbank's business, especially under the current economic situation in the financial sector.

As such we kindly ask you to continue working on the reorganisation plan and get it approved by the Bankruptcy Court in order to let us continue SCO products sales and support for Sberbank.

Yours Sincerely,

[Signature, notarized]

Oleg Elenin, CEO

Business Console Ltd.
Moscow, Russia

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

EXHIBIT 1

(1)

SCO OpenServer UNIX
And it's Use by the US Army to Secure Communications

The OpenServer 5 UNIX operating system by the SCO Group, Inc. is one of the primary applications used in over 400 US Army accounts around the world in the support and defense of worldwide communications security in the Electronic Key Management System (EKMS).

The OpenServer 5 UNIX operating system was chosen by the National Security Agency (NSA) to support the communications security (COMSEC) Local Management Device (LMD) computer application software. The OpenServer 5 UNIX operating system is used not only by the Army but also by all other US military services as well as many of the US Civil Agencies.

There is no option in the near future of replacing the OpenServer 5 operating system and to lose access to the technical support as well as future upgrades, maintenance releases, and patches would be potentially harmful to the internal operations of the EKMS.

Sincerely,

David L. Dickerson, CISSP
Contractor, CACI, Inc
US Army CECOM LCMC CSLA
EKMS Joint Technical Working Group Co-chair
Fort Huachuca, AZ

This letter is not meant to be an official CACI or Government endorsement of any product and is to be used to support SCO in submitting a customer summary to the bankruptcy judge only.

(2)

000 БИЗНЕС КОНСОЛЬ


The SCO Group Inc.
355 South 520 West
Suite 250
Lindon, Utah 84042-1911
USA

Attn. Jeff Hunsaker, President and COO

Dear Mr Hunsaker,

Let me share our thoughts regarding SCO legal filings and prospects of your company's products usage.

Business Console Ltd. is SCO's premier partner in Russia. Our major customer Russian Savings Bank (Sberbank) is the largest bank in Russia with about 20.000 offices countrywide. The bank's most widely deployed application uses SCO Unix products family for about 10 years.

Sberbank considered alternatives to SCO platform in 2005 when they decided to replace then current SCO OpenServer 5 yet after thorough evaluation and testing they favored SCO OpenServer 6 for its superior reliability, price/performance and well-established support.

The contract between SCO, Sberbank and Business Console covering software purchases and support was signed in October 2007. The bank purchased and installed SCO OpenServer 6 licences for about 2.500 servers since then. It was confirmed by Sberbank officials during recent meeting in March 2009 that the roll out will continue over years: about 15% of servers in operations become obsolete per year and replacement servers should be equipped with OpenServer 6.

As we have been informed, there is a potential move to put SCO under Chapter 7 (bankruptcy). We like to express, that this step would cause enormous problems for Sberbank and our company. The Bank would need the garantee for further development and support on SCO OpenServer 6. Evaluating alternative solutions as well as porting the application software counting millions lines of code and rolling out an alternative solution would mean men years of work and high associated costs. This would be a heavy impact to Sberbank's business, especially under the current economic situation in the financial sector.

As such we kindly ask you to continue working on the reorganisation plan and get it approved by the Bankruptcy Court in order to let us continue SCO products sales and support for Sberbank.

Yours Sincerely,

[Signature and stamp]

Oleg Elenin, CEO

Business Console Ltd.
Moscow, Russia

(3)

DTR BUSINESS SYSTEMS

June 1, 2009

Alan Raymond
Vice President
SCO Operations, Inc.
[Address in Lindon, Utah]

Dear Alan,

In regard to the upcoming hearing regarding SCO's future, I would like to confirm that it is DTR Business Systems' intent to continue to provide our customers with SCO products for years to come,

As a long time partner of SCO representing hundreds of customers using SCO, it would not be in the best interest of our business, nor our customer's businesses to interrupt the availability of SCO products, nor to interrupt the services and support your organization provides to us.

The expense to our customers based on having to replace the products from SCO they currently use would put extreme financial strain at a time when some of our customers simply cannot bear the financial burden. The bottom line is that they would be forced to spend money on something that would provide them with no additional technical functionality.

It is our belief that with a successful reorganization plan in place SCO will receive the full support of its customer base to help it to profitability and long term success. We understand and support your company in its continuing effort to provide stable, dependable technology that we and our customers have selected again and again.

Regards,

[Signature]

Rene' Beltran
Executive Vice-President

DTR Business Systems, Inc. [Street address], Walnut, California [zip, phone]

(4)

From: Hans Daas [mailto:[name(AT)]zippak.com]
Sent: Tuesday, June 02, 2009 1:49 PM
To: 'Kerri Wallach'
Subject: RE: Letter to Court

ITW Minigrip and ITW Zip Pak have been using an SCO platform for their accounting and production needs since 1991. Not being able to obtain that technology in the near future would force us to find an alternative which will have a big impact on our way of doing business. It would take us a year or more to implement such an alternative that will probably not be as reliable as our current SCO product.

We ask the court to rule in favor of SCO

Hans Daas
IT Manager, ITW Minigrip/Zip Pak

To Whom it May Concern,

This letter comes to you from a completely satisfied customer of the SCO Unix Operating System. BudSco is an agricultural company in Salinas, Ca and has been in business for over 30 years. For more then 20 of the 30+ years we have used the SCO unix system, and it has been an extremely reliable product.

We have upgraded our hardware and software many times, and have never had any down time in doing so. Their service and support teams are always very friendly and professional, which makes using their product an excellent business tool.

We look forward to many more years as a customer of SCO, as their products and people are exceptional.

Lori Hobbs, Controller

BudSco, Inc.

P.O. Box [num]

Spreckels, CA [zip]

phone

(5)

Page 1 of 1

Arthur J. Spector

From: Jeff Hunsaker [[name(AT)]sco.com]

Sent: Friday, June 05, 2009 6:02 PM

To: Arthur J. Spector

Subject: Re: [Fwd: Customer Support-MOD]

----- Original Message ----- *From:* DES ISS ISD-ASP SM Fleet6e Clarke, Mike Mr [mailto:[name(AT)]a.dii.mod.uk]
*Sent:* 05 June 2009 16:13
*To:* 'Steve Skinner'
*Cc:* DES ISS ISD-ASP SM Fleet1 Lord, Lu Miss
*Subject:* SCO Support Performance

Steve,

As discussed last week, the MOD cannot endorse a private companies products or services. However, we are happy to provide, for your use, the following statement reflecting the technical support provided to us in relation to our various UnixWare applications..

**"The MoD Application Service Provider (ASP) has been provided with technical assistance on the Unixware operating system by SCO under a 12 month support contract placed in October 2008 via Software Box. To date, the ASP has raised 7 calls for support under this contract, all of which have been resolved to full satisfaction. From 2003 to 2007, the ASP placed similar 12 month support contracts direct with SCO. Under those contracts, a further 49 help requests were placed on the company, again with a 100% resolution success rate."**

Best regards

Mike

*Mike Clarke*
DES ISS ISD-ASP SM Fleet6e
[street]
Ensleigh,
Bath
Ens Mil: [number] 68164 BT: [phone]
[name(AT)]a.dii.mod.uk

6/5/2009

(6)

To whomever it may concern:

We, the undersigned members of iXorg, Inc, an international non-profit organization founded in 1989 to promote and educate computer system resellers, system integrators and consultants specializing in supporting the UNIX operating system, hereby request that the motion by Novell, IBM, et.al., to move SCO from Chapter 11 to Chapter 7 be denied.
We feel that moving SCO into Chapter 7 will do irreparable harm to iXorg, Inc, its member companies, and the thousands of customers supported by them.
It is critical to our survival and our customers that we have ready access to SCO products, timely updates and bug fixes and support from competent and qualified engineering personnel. In order to continue to support our customers, access to these vital resources must be maintained.
Specifically, our concern is that a move to Chapter 7 will damage SCO's reputation in the industry, causing the loss of both hardware and software vendor support, just when we in iXorg have spent hundreds of man-hours working on reestablishing and solidifying business relationships with these organizations.
Furthermore, we feel a move to Chapter 7 will cause more delays and interruptions in established product timelines and promised deliverables at a time in the economy when we can least afford these delays.
Respectfully submitted on behalf of the 65 member companies of iXorg, Inc.,

The Board of Directors, iXorg, Inc as:
Robert J. Ungaretti, President
Jean-Pierre Radley, Vice President
David Dew, Treasurer
Steve ]ames, Secretary
Paul McNary, Director
Mike Brown, Director
Deepak Thadani, Director

(7)

Betreff:
InnTech and SCO
Von:
"Esgardo Cook"
Datum:
Thu, 5 Mar 2009 15:12:32 -0200

An:

To who concern,

We (InnTech and SCO) have been working since 1990, during those years we were selling and supporting SCO UNIX and we have hundreds of customers and resellers spread all over Mexico, for them and for us would be of utmost importance that the future of SCO's Unix business will remain intact and can serve our customers need for many more years.

Most of the companies who are using SCO Unix it is for mission critical, then those companies need SCO to continue with their operations.

Best regards,

*P **Por favor considere el medio ambiente antes de imprimir este correo electronico.*

*InnTech entregando soluciones de INFRAESTRUCTURA (UNIX-LINUX), VIRTUALIZACION Y SEGURIDAD *



| I Esgardo Cook | Director Comercial | *Inn*tech | Conmutador [phone] | Directo [phone] |

| [name(AT)]inntech.com.mx | _ www.inntech.com.mx http://www.inntech.com.mx/>_ |

[Address] México D.F.


_*Ian Clough, Managing Director, Intech Ltd, UK*_
Intech Ltd are a software house based in the UK. Our major clients are US companies operating in the UK. We and our clients have been using SCO's Unix operating systems for 20 years. It is very important to ourselves and our clients that SCO's Unix business continues to function.

(8)


_*Malcolm Chenery, Business Development Director, Rubicon Computer Systems, UK*_
Rubicon Computer Systems Ltd, have been using various of SCO's Unix Operating Systems for in excess of ten years. One of our major ERP software products is designed to run exclusively within the SCO Unix Operating System environment. This product supports a significant number of end-user organisations, some of whom are in excess of £100 million turnover companies who supply Fresh Produce to all of the major UK based Retail Multiples. It is therefore vitally important that the future of SCO's Unix business remains intact and can continue to serve our needs as a supplier of robust software solutions, to both our current and future customer base for many years to come.


Betreff:
Regarding SCO Chapter 11...
Von:
"Jaime Yory"
Datum:
Fri, 6 Mar 2009 13:27:29 -0200

An:

CC:
'Pedro MuHoz'

Daniel,

we would like to communicate to you and to SCO management that our company Mayorista de Valor Agregado S.A. have been working with SCO Unix for more than 10 years, serving customers and resellers partners all over Colombia, Venezuela and Central America, It would be very important the future of the SCO's business. Most of our customers have been using SCO Unix to run their critical applications for many years and they need to see a viable future going forward. We hope good news regarding SCO Chapter 11 status very soon,

Sincerely,


*/Jaime Yory/*

*/Director, Int'l Operations/*

*/MVA USA, Inc/**.*

/[address]/

(9)

/[Address in Florida, Phone, Fax]/

email:/[name(AT)]mvausa.com/

/http://www.mvc1uso.com/ http://www.mvausa.com/>


Betreff:
Who may concern
Von:
"Xavier Miquel"
Datum:
Mon, 9 Mar 2009 14:50:54 -0200

An:

Who may concern:

We as Dakel Informática have been selling and supporting SCO UNIX since 1995, we are the unique SCO distributor in Spain, there are hundreds of customers and resellers in the country that run or support SCO Unix, in many cases running critical applications for the day to day business; for all our customers would be of utmost importance that the future of SCO's Unix business will remain intact. We intend to go on supporting the customer needs for many more years.

Xavier Miquel

Director

Dakel Informática S.A.

[address] Barcelona-Spain

[Telephone, Fax]

e-mail: [name(AT)]dakel.com www.dakel.com http://www.dakel.com>

(10)


Here's another supportive statement from a UK reseller :

_*Chris Netherton, Managing Director, Microtest Ltd, UK*_
Microtest Ltd have been using SCO's Unix operating systems for some 25 years as part of our specialist software applications supplied to the UK National Health Service. Whilst we have the option of migrating to Linux we know that we would not receive the commitment, level of support, performance or stability of product for which we have come to rely on with SCO. It is vitally important to us and our customers that the future of SCO's Unix business remains intact to ensure that we can continue to excel in the provision of key healthcare systems and serve the needs as a supplier to our GP Health Centres, Primary Care Trust customers and the UK Government for the foreseeable future.


Subject:
Over SCO and SRB
From:
"Juan Carlos Reyes, SRB Argentina"
Date:
Wed, 11 Mar 2009 13:29:32 -0200
To:


To:


*Daniel, *

*We wonder if you can communicate to SCO management that we as SRB have been working with SCO Unix for more than 5 years, selling products and supporting customers in Chile and Argentina, It would be very important for our customers the future of the SCO's business. Most of them have been using SCO Unix for many years and have desire to go on using them for many more years due to the stability and reliability of the products,*

*Regards,*

*/Juan Carlos Reyes/*

*/SRB "Security Relevant to your Business"/*

*[name(AT)]srb.com.ar *

*MSN: *[name(AT)]hotmail.com

(11)

*SKIPE:* [id]

*SRB Argentina SRB Chile*

*www.srb.com.ar http://www.srb.com.ar/> www.srb.cl*

[Street addresses]

C1032ABS Ciudad de Buenos Aires Las Condes, Santiago de Chile

Republica Argentina Chile

[Phone and faxes]


Chris Netherton, MD, Microtest

Microtest Ltd have been using SCO's Unix operating systems for some 25 years as part of our specialist software applications supplied to the UK National Health Service. Whilst we have the option of migrating to Linux we know that we would not receive the commitment, level of support, performance or stability of product for which we have come to rely on SCO.

In the recent National Health Service clinical systems OJEU contract award, Microtest came out in first place for software, systems, support and service and won the contract with the highest weighted score. It is vitally important to us and our customers that the future of SCO's Unix business remains intact to ensure that we can continue to excel in the provision of key healthcare systems and serve the needs as a supplier to our GP Health Centres, Primary Care Trust customers and the UK Government for the foreseeable future.

Ian Clough, MD, lntech Ltd

Intech Ltd are a software house based in the UK. Our major clients are US companies operating in the UK. We and our clients have been using SCO's Unix operating systems for 20 years. lt is very important to ourselves and our clients that SCO's Unix business continues to function.

(12)

Malcolm Chenery, Business Development Director, Rubicon Computer Systems Ltd
Rubicon Computer Systems Ltd, have been using various of SCO's Unix Operating Systems for in excess of ten years. One of our major ERP software products is designed to run exclusively within the SCO Unix Operating System environment. This product supports a significant number of end-user organisations, some of whom are in excess of £10O million turnover companies who supply Fresh Produce to all of the major UK based Retail Multiples. lt is therefore vitally important that the future of SCO's Unix business remains intact and can continue to serve our needs as a supplier of robust software solutions, to both our current and future customer base for many years to come.

----- Original Message -----
From: Rita Klevenski [mailto: [name(AT)]terian.com]
Sent: Tuesday, June 02, 2009 8:01 AM
To: [name(AT)]sco.com
Subject: Letter to Court

Jeff Hunsaker, President and Alan Raymond, Vice President of SCO Operations, Inc.

Terian Solutions, LLC as a long standing distributor of SCO would have a significant negative financial impact to our business and the business of our customers if SCO was liquidated and the technology was no longer available or supported.

We would sincerely welcome if the current reorganization efforts of The SCO Group Inc. would be supported and approved by the Bankruptcy Judge in order to continue our business relationship with the company for many years into the future.

Kindest regards,

Rita Klevenski

Terian Solutions, LLC

[Phone, mail]

www.terian.com

(13)

there will be several (3-5) more letters from ixorg on Wednesday morning. The below 2 letters will be resent on company letterhead on Wednesday:

To whom it may concern:

As a long-time Unix reseller (over 20 years), I am most concerned about SCO being moved to a Chapter 7 bankruptcy and feel that the motion to do so should be denied.

It is critical that SCO be allowed to continue developing new releases of its Unix operating system. Our livelihood depends on being able to procure new Unix licenses from SCO so that we can then resell them. In addition, SCO needs to be able to continue adding new features and support for newer hardware going forward. If we are unable to keep up with new hardware, we will be irreparably damaged because we won't be able to sell new systems and/or networks any more.

The SCO support organization is critical as well because there are operating system issues (from time to time) that cannot be resolved without access to the authors of the code. New releases are a prime example because this is typically when most bugs occur.

Losing the SCO products and support team would basically mean that we are out of business because we have thousands of software programs that would have to be converted to another platform. It would take at least a couple of years to do that.

We would throw ourselves on the mercy of the court and ask that you please don't take our SCO away!

Respectfully yours,

Chendal Coulter

President

Software Sourcery Systems, Inc.

(14)


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