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SCO sells company so they can continue litigation: how very American!

SCO used to sell operating systems and related software based around Linux, Unix, and in their early years Xenix. A few years ago they decided to start suing everyone they could think of with the claim that companies like IBM, Novell, and RedHat had “stolen” their Unix intellectual property. You can read all about the legal history of it here at Groklaw. After years of losing every legal battle they started, facing counter-suits from the people who *really* own the Unix intellectual capital, and filing for bankruptcy, they are doing the only reasonable (at least in America) thing: they are selling all of their real assets so that they can continue the legal battle

The whole SCO vs Linux (and IBM, and Novell, and…) thing was a joke from the outset. I kept expecting them to show at least some evidence of the “theft” they claimed for the first few months back at the beginning in 2003. But the only evidence they ever showed was utterly laughable: pieces of code that had been published in dozens of University texts going back decades, none of which was subject to any kind of copyright.

I have to believe that the senior players in the drama on the SCO side of things, particularly Darl McBride, were and still are willfully ignorant. The alternative is either a degree of stupidity that exceeds all reasonable measures or outright criminal misconduct by these corporate officials, one or the other. Unix spent its first two decades widely used as an educational operating system, passed back and forth by Berkley and AT&T in various releases, contributed to by tens of thousands of students. Microsoft licensed and created their own version of Unix, Xenix, based on a limited license of the AT&T release of UNIX, around 1980, and that was eventually spun off into the Santa Cruz Operation (SCO). Novell bought the AT&T System V licenses from AT&T sometime around 1991-1993. But the Berkley (BSD) version of UNIX was still in existence at that time, as were dozens of companies with limited licenses of the AT&T or BSD distributions: companies like Sun, Hewlett Packard, IBM, SGI, Digital Equipment, and others. None of those licenses “reverted” to AT&T or Novell. Linux was written independently from Unix, based on publicly available materials and code descriptions available to any student.

Eventually, SCO (which was by that time in the process of being bought by Caldera, a company that had made its start selling Linux) bought the right to some portion of the AT&T licenses from Novell. The contract was actually quite limited, but someone obviously said “We own Unix now!”, and some willfully ignorant executives thought that was really true. In 2003, facing dwindling revenues, SCO decided to start suing people who had (they claimed) stolen their Unix: companies that, unfortunately for SCO, actually knew the history and contractual agreements that existed. Companies like IBM.

For folks who don’t know, IBM is a $100 billion dollar a year company with 340,000 employees. SCO’s annual revenues are around $10 million. IBM has a legal staff that is probably ten times the size of SCO’s entire employee base. It is not very bright to sue a company like IBM without really having a really solid case. But one can assume that the executives at SCO figured they could gain something from the process.

Five years later, what they’ve gained is… five years of earning their salary despite their company shrinking into non-existence. And now they want to liquidate what is left to continue pursuing a legal case that anyone can see is not only a lost cause, but a wickedly misdirected waste of shareholder and societal value.

The truth is, Darl McBride and his executive team probably couldn’t manage a real company. They are part of a dark wart on the buttocks of American business today: the Intellectual Property Litigator. The challenge of actually dealing with customers, directing development, managing expenditures, and marketing a product that people want is utterly beyond them. All they can do is try to steal something someone greater than they could ever dream to be has imagined; actually turning that idea, that patent, that “intellectual property” into some kind of reality is too challenging for their meager, petty, and greedy little minds. But worse than that: SCO doesn’t even actually own the property they are suing people over- they just keep blowing smoke and pretending they do, in the hope that they can keep making payments on their yachts and Porsches indefinitely.

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