UPDATED: SCO sues Novell for 'alleged bad faith'

By Matt Whipp

Posted on 21 Jan 2004 at 11:00

Schultz told us: 'I wouldn't be surprised if Novell tries to consolidate the case with the one against IBM so all the issues can be sorted out together.'

We asked Blepp whether the transfer of Unix assets from the original SCO to Tarantella to
Caldera (which then became SCO) constituted a change of ownership, which would appear to at least give Novell a full Unix licence. 'Not in the language that Novell is referring to,' replied Blepp.

Novell says it doesn't comment on such matters but added: 'We certainly plan to defend our ownership of Unix copyrights. Interested individuals can see Novell's position on those copyrights in our Dec. 22 statement and in related correspondence with SCO, also publicly available on Novell's website.' SCO has also published revelant documentation.

Boies, Schiller and Flexner is also the legal team employed by SCO to take on IBM. On the IBM case, the firm is working at a cut-price hourly rate but with an arrangement to collect a percentage of monies from settlements and so on. Blepp would not comment on whether the arrangement had been carried through to the Novell case.

Schultz, though, pointed out that arrangement certainly gives the company room to take on more legal action without the drain on its financial resources.

'As far as SCO having the resources to fight this battle, they've pretty much put all their eggs in this basket, so one more lawsuit isn't going to bankrupt them. Given that their lawyers are being paid on contingency of the outcome and not on an hourly wage, this will raise the stakes of victory or defeat but won't affect their quarterly financials that much.

'[SCO intends] to make money by threatening people with lawsuits and selling licenses. Just as other companies invest in R&D, SCO has to invest in its legal team in order to raise the fear level high enough so that people capitulate to their demands. It's an all-or-nothing strategy, so I wouldn't be surprised if SCO spends every last penny trying to win this fight.'