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Judge approves sale of SCO's Unix system
This is an archived article that was published on sltrib.com in 2011, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

A federal judge has approved the sale of the Unix computer operating system owned by The SCO Group of Lindon.

U.S. District Judge Kevin Gross turned aside a challenge by Novell Inc. and gave his blessing to the sale of the application that runs certain business functions, such as the system that takes orders for McDonald's customers.

The sale to a company called UnXis will close by March 31 unless Novell files an objection, posts a bond and obtains a stay, Richard A. Bolandz, CEO of UnXis, said Tuesday.

SCO owes Novell about$3 million, the result of a trial in which a federal jury in Salt Lake City found in Novell's favor in a dispute over which company owns the copyrights to Unix after a 1995 sale of the system. That dispute and a lawsuit against IBM drained SCO's resources and sent it into bankrupcty in 2007.

Gross in a ruling Monday said he "understands Novell's desire to punish debtors for years of expensive and painful litigation." But he said the sale was a "fair and reasonable transaction in the good-faith exercise of debtor's business judgment."

Bolandz said he hoped to convince Novell not to pour more legal fees into stopping the sale and instead enter a business relationship with UnXis, which was formed in June 2009 to purchase Unix and is backed by MerchantBridge & Co. and Gerson Global Advisors, as well as Stephen Norris, owner of an investment fund bearing his name.

"What I suggested to them is if they work with us, they have access for [their] tool suites to our server base of over a million servers," said Bolandz. "That makes business sense."

Novell representatives declined to comment.

It's unclear whether SCO will continue to pursue the Novell and IBM lawsuits if the sale closes. Bolandz said the company is out of money. SCO is waiting the outcome of its appeal of a 2010 jury verdict and other judicial decisions in its suit against Novell.

UnXis paid only $600,000 for the Unix operating system. Bruce Comer, managing director of Ocean Park Advisors, which conducted the Unix sale, said in a court filing the only other bid was for $18.

tharvey@sltrib.com

Bankruptcy • Novell can still object to the sale of the computer operating software.
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