Canopy deal: Former CEO stays on board of SCO Group
Fired Canopy Group Chief Executive Ralph Yarro and two associates received an unspecified payoff in return for resigning from all positions with the technology venture firm and its portfolio companies.
Under terms of an out-of-court settlement ending dueling lawsuits for control of Canopy, Yarro, former chief financial officer Darcy Mott and former corporate counsel Brent Christensen sever all connections to the tech umbrella company with the exception of the SCO Group, best known for its controversial $5 billion lawsuit against IBM and other companies related to Unix and Linux operating system rights.
Yarro, seen as a behind-the-scenes supporter of SCO's expensive litigation strategy, remains as SCO's chairman and Mott continues as a director. The settlement also seems to have secured, for now, the position of longtime Yarro colleague Darl McBride, who serves as SCO's CEO.
In a joint statement issued Friday, attorneys for Yarro, Mott and Christensen, and legal counsel representing Canopy and members of the company's founding Noorda family, also said that in addition to "an undisclosed amount of money . . . Mr. Yarro will receive Canopy's shares of SCO stock."
Canopy reportedly holds about 30 percent of SCO's stock, the largest single ownership of the Lindon software company's shares.
The brief statement offered no other details, saying the remainder of the settlement is confidential.
Following their Dec. 17 ouster in a 2-1 vote by Canopy founder and tech guru Ray Noorda and his wife, Lawena, against Yarro, Yarro, Mott and Christensen filed suit in Provo's 4th District Court seeking at least $100 million and reinstatement.
The suit contended the coup was led by the Noordas' daughter, Val Noorda Kriedel of Orange County, Calif.; longtime Canopy investment adviser Terry Peterson, and William Mustard, an independent senior executive consultant appointed CEO in Yarro's place, and apparently now on permanent assignment to that post.
Canopy countersued, along with the elder Noordas, as officers of the Noorda Family Trust, Canopy's founding and primary investor. They accused Yarro, Mott and Christensen of siphoning off nearly $25 million via "a series of self-dealing and wasteful transactions."
Both sides alleged the other took advantage of the Noordas' trust and purportedly failing health. The mental acuity of Ray Noorda, 80, was questioned in particular.
David B. Watkiss, the attorney for Canopy Group, denied published reports that court-appointed physicians had found Noorda to be incompetent. However, he did confirm that "it is a matter of public record that Mr. Noorda suffers from Alzheimer's disease. [But] no court-appointed doctors have found Mr. Noorda incompetent."
As for Canopy and the Noordas' allegations of misappropriated funds, Yarro attorney Stan Preston noted that "it is not my clients who are paying cash to settle this case."
Watkiss declined to comment beyond the joint statement.
However, Preston characterized the funding misappropriation charges as "entirely without merit.
"My clients are very pleased with the settlement, which will allow them to continue to assist companies and create jobs in Utah. They are happy to have this matter behind them so that they can move forward with their lives."
Preston also offered an olive branch on behalf of his clients, who he said "extend their best wishes to the Noorda family [and] express their gratitude for having had the opportunity to work with and learn from Mr. Ray Noorda, one of Utah's greatest business leaders."
l Fired Canopy principals Ralph Yarro, Darcy Mott and Brent Christensen receive an undisclosed sum of money.
l The trio cuts all ties to Canopy with one exception: Yarro remains chairman of SCO Group and Mott remains an SCO director.