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Novell Files Motion to Set Aside Judgment Re SCOsource Monies
Wednesday, December 23 2009 @ 01:27 AM EST

Novell is asking the Utah District Court to set aside the earlier judgment by the Hon. Dale Kimball that Novell is not entitled to any of the SCOsource money from Microsoft or from Linux end users like EV1. That decision was based on his earlier ruling in August of 2007 on summary judgment that Novell owned the copyrights, not SCO, and that since SCO couldn't offer a release of copyright infringement claims, since it didn't own the copyrights, the licenses must not be SVRX licenses. I never could see the logic in that, but that is what happened. But since the Tenth Circuit set that summary judgment aside on copyright ownership, the judgment that Novell has no claim on the money must also be set aside, Novell argues.

In effect, if SCO were to be declared the owner of the copyrights, then Novell would like its 95 percent of any royalties. Of course, SCO is broke, so why is Novell asking for money, when it's so unlikely it will ever get any? I can only guess, but I believe they see that SCO is thinking of gearing up the SCOsource business if it can win the copyrights at trial, and Novell is moving to block. If the licenses are determined to be about SVRX, then SCO would be obligated not only to pay almost everything to Novell, but to ask Novell for permission to sue. Think somewhere between slim to none, the odds of Novell granting SCO permission to sue Linux end users.

Here is the motion, the memorandum in support, and a declaration by one of the attorneys:

12/22/2009 - 608 - MOTION to Set Aside Judgment filed by Defendant Novell, Inc.. (Sneddon, Heather) (Entered: 12/22/2009)

12/22/2009 - 609 - MEMORANDUM in Support re 608 MOTION to Set Aside Judgment filed by Defendant Novell, Inc.. (Sneddon, Heather) (Entered: 12/22/2009)

12/22/2009 - 610 - DECLARATION of Grant L. Kim re 608 MOTION to Set Aside Judgment filed by Novell, Inc.. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4)(Sneddon, Heather) (Entered: 12/22/2009)

If you review Novell's arguments in this Motion for Partial Summary Judgment on the SCOsource issues, you'll see why I think that is what this is about. Of course, Novell would like its money too, but it also is stalwartly standing up to the bully trying to kick sand in Linux users' faces. And it viewed and views those SCOsource licenses as SVRX licenses, and while Judge Kimball ruled against them on that point, I think erroneously, they'd like another chance to present its case, now that the basis for Kimball's ruling has been reversed on appeal. Here's a bit of Novell's argument back then:
1. The Asset Purchase Agreement prohibits SCO from modifying existing SVRX Licenses and from entering into new SVRX Licenses. (Declaration of David E. Melaugh in Support of Novell's Motion for Summary Judgment on its Fourth Claim for Relief, filed herewith ("Melaugh Decl."), Ex. 9 (APA) at 4.16; Order at 92.)

2. SCO can amend existing SVRX Licenses only "as may be incidentally involved through its rights to sell and license [UnixWare software]" or "to allow a licensee under a particular SVRX License to use the source code of the relevant SVRX product(s) on additional CPU's or to receive an additional distribution, from [SCO], of such source code." (Id.; see also Melaugh Decl., Ex. 10 (Amendment No. 1) 10 (amending APA 4.16).)

3. SCO can enter into new SVRX Licenses only "as may be incidentally involved through its rights to sell and license [UnixWare software]." (Id.)

4. In addition, before entering into "any potential transaction with an SVRX licensee which concerns a buy-out of any such licensee's royalty obligations," SCO must obtain Novell's consent. (Melaugh Decl., Ex. 12 (Amendment No. 2) at B.) This prohibition is subject to no exceptions.

So if, in some crazed alternate universe, SCO were declared the owner of the copyrights and ramped up SCOsource, it would be Novell's position that SCO had no authority to enter into such deals without Novell's permission, and should it get it, unlikely at best, then Novell would take almost all the money anyway, a distinct disincentive.

If this doesn't make sense to you, don't apply to law school. This is exactly how lawyers think. They set a goal, and they then look for a way to reach it.

Here's the rule that Novell is using as the foundation of its motion, FRCP Rule 60(b)(5):

(b) Grounds for Relief from a Final Judgment, Order, or Proceeding.

On motion and just terms, the court may relieve a party or its legal representative from a final judgment, order, or proceeding for the following reasons:... (5) the judgment has been satisfied, released, or discharged; it is based on an earlier judgment that has been reversed or vacated; or applying it prospectively is no longer equitable;

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