Novell Wins Again - Jury Rules Copyrights Didn't Go to SCO!(Groklaw)

What a relief.

It is true that SCOSource is a dead duck right now. Perhaps SCO too. But, then SCO has been on the respirator for some time. Although the jury may have kicked out the plug.

Is the legal action against IBM still on? I suppose technically it still is. And while the big claim against IBM never really was based upon claimed copyright violations but rather contract law, SCO has a very lousy contracts case. We have to go back a few years to regurgitate all of the contract issues. But, almost all of them favored IBM not SCO.

And as positive as this case is for open source, the GPL and Linux in particular, this may mean that the charge of copyright violations may never reach a courtroom. So legally speaking Linux is not really off the hook. It may mean that SCO is no longer significant in any legal way. But, there will always be those who can claim that the Linux copyright violations were never decided by a court of law. And that might be correct.

Assuming Novell holds onto this verdict and the copyrights, Novell certainly is not interested in attacking the GPL and Linux. At least I would assume so. If someone buys them out, it is hard to tell.

To be honest, Linux would benefit by being challenged in court on the copyright issues.

By this time, it is easy to understand the statement that it is very rare that all of the legal issues raised by major litigation actually get resolved. In this case we see SCO get tossed out simply based upon the wording of the APA (even with the help of witnesses that clearly did not understand the deal).

And this may mean that the appeal pending before the US Supreme Court may be withdrawn. And that means that the law in the area of just what kind of written agreement is required to transfer copyrights remains unclear. Maybe Novell will continue to press the appeal and get a definitive decision. It would really benefit not only Novell but the entire industry. But, it is likely that Novell will offer to drop that appeal if SCO also decides not to appeal the instant case. You never know. But, often times it takes many years for a critical issue to actually be resolved in court. Clearly that is not the case currently or the appellate court would never have sent the SCO v. Novell case back for trial.

I do not want to sound like a cynic but the current decision by the jury is not necessarily the best possible outcome to this case. Much better would be a decision by the US Supreme court that simply says that the APA as written including its amendments does not sufficiently detail which copyrights transferred (if any) and therefore fails to do so. Simply put, when congress decided that copyright transfers had to be in writing they did not approve of a vaguely or even ambiguous transfer agreement being clarified by extrinsic evidence. Perhaps not even by testimony from lawyers on both sides. If the transfer depends upon oral testimony the transfer was NOT in writing. That would be the best resolution for the industry. And not the current situation where litigation is encouraged for years and years after a transfer of part of a business takes place.

When transaction lawyers know that the individual copyrights do in fact have to be listed in a written agreement, they know how to do it. And they can do it. Just like when the business was sold off to Caldera the lawyers said we have a problem with proving the chain of title. Lawyers know about such things. And they should be obligated to make it clear or the transfer fails.

Back on IBM:

SCO has a slim chance of making anything out of their contract issues in regard to IBM. As mentioned above, most if not all of the contract issues were discussed years ago both here and on Groklaw. And no doubt, if the IBM case does not go away, they will be discussed again and again. Whatever it takes for the public to understand the issues.

But, the statements coming out of SCO now are correct. The case against IBM was primarily based upon contract law. No so for Red Hat. Red Hat can pursue damages against SCO based upon the fact that SCO never held the copyrights in the first place. Yet it tried to harm Red Hat with allegation that SCO can not prove nor have the right to make public claims. SCO did that at its own risk. And SCO lawyers will have a very tough time trying to convince anyone that they had a good faith belief that SCO got the copyrights. Judge Kimball decided “no”. And now a jury decided “no”. Just how dumb do those lawyers want to paint themselves?

Of course SCO is broke. Even more broken than it was a couple weeks ago. And to be honest I can not understand how or why a trustee would continue to pursue the case against IBM. There is almost no chance that IBM is going to pay a dime to make that case go away. Not a dime. Not a chance. That suit is an insult to both the IP and contract lawyers at IBM. Not to mention the management. And at this point I would guess IBM wants a judgment against SCO even if SCO could never pay. Even a dime. But, IBM needs to defend itself. IBM needs to show the industry that its lawyers do know what they are doing. Both IP and contract lawyers need to prove that. IBM needs to maintain some degree of credibility in the industry.

Supplement:

Do not forget that the Novell APA also included that provision that Novell could nix action taken by Santa Cruz (and by extension SCO) against licensees.

As you may recall, Judge Kimball found the provision valid. And while the appellate court overturned the issue in regard to copyrights I do not think they addressed the provision regarding Novell being able to tell SCO want to do in regard to licensees. And keep in mind that SCO has to prove that provision invalid. So if no such decision in a court of law does that, it remains in affect. And that could seriously limit what SCO can pursue against IBM. As you may recall, Judge Kimball (also then sitting on the IBM case) decided that the provision in the APA pretty much mooted much of the IBM case. And while I do not recall if Judge Kimball was removed from the IBM as well, it may not matter much. That provision is valid until proven otherwise. SCO may have almost nothing to gain by trying to continue the IBM litigation. And since IBM has answered and provided counter charges, SCO can not just dismiss it either. Or, say “never mind”. IBM may not want to just let SCO off the hook. As explained above IBM has an interest in seeing its legal departments fully supported and credited. Nobody wants the public to be laughing at their legal departments.

Save for perhaps SCO.