SCO says clause bolsters Linux claim
By Stephen Shankland, CNET
News.com
9/6/2003
URL:
http://asia.cnet.com/newstech/systems/0,39001153,39135666,00.htm
SCO Group last week discovered a clause in a contract that could bolster its
potential legal claims against Linux users.
The company said it has uncovered a 1996 amendment to the contract under which
Novell sold many of its Unix assets--which appears to give SCO claim to at least some Unix
copyrights.
The amendment seems to reverse a provision in the original 1995 asset transfer
agreement under which Novell sold much of the Unix business to SCO's predecessor, the
Santa Cruz Operation. That sale specifically excluded copyrights from the transfer. The
amendment modifies this exclusion, so that SCO seems to receive at least some Unix
copyrights.
"Our interpretation of this is that we have the copyrights for Unix and
UnixWare technologies," said SCO spokesman Blake Stowell. The amendment, dated Oct.
16, 1996, was signed about a year after the original transfer agreement.
Even SCO challenger Novell seems to concur, in part, with SCO's interpretation,
though Novell said it doesn't have a copy of the amendment in its files and still
takes issue with SCO's actions against Linux users.
The amendment "that came to Novell's attention today appears to bear a
valid Novell signature, and the language, though convoluted, seems to support SCO's
claim that ownership of some copyrights for Unix did transfer to SCO," Novell said in
a statement issued Thursday. "The amendment does not address ownership of patents,
however, which clearly remain with Novell."
The amendment was part of a larger financial transaction between the Santa Cruz
Operation and Novell, but Stowell didn't have details of that broader agreement.
Novell also reiterated its demand that SCO substantiate its claims that proprietary
Unix code has been copied into Linux, an open-source operating system modeled after Unix,
but whose underlying source code is public.
The copying claim, which grew out of SCO's U$1 billion lawsuit against IBM,
spurred SCO to send letters to 1,500 large companies warning that using Linux could expose
them to legal liability.
At least one independent observer agreed that the amendment appears to give SCO
copyrights.
"They do have the copyrights," said John Ferrell, an intellectual property
attorney with Carr and Ferrell, after reviewing the contract amendment.
However, for SCO to bring copyright-based lawsuits against Linux users, SCO would
have to show that the copyright transfers have been registered at the U.S. Copyright
Office, Ferrell said.
Signing a contract that transfers the copyrights but not registering that transfer
"is akin to buying the Hearst Castle and not recording the deed with the county
recorder," Ferrell said.
The amendment changes the intellectual property that wasn't sold to the Santa
Cruz Operation. It was modified to exclude from transfer "all copyrights and
trademarks, except for the copyrights and trademarks owned by Novell as of the date of the
agreement, required for SCO to exercise its rights with respect to the acquisition of Unix
and UnixWare technologies."
A SCO paralegal found the amendment Thursday in a filing cabinet, Stowell said.
It's titled "Amendment No. 2"; Amendment No. 1 is "completely
immaterial" to the issue of copyrights and trademarks, said Stowell, who said he
believes there are no other amendments.
SCO plans to detail the amended filing and its implications in a news conference
Friday.