Novell licensing beef with SCO tied to 1995 version of Unix
Lawyers for The SCO Group Inc. told a federal judge Tuesday that anything it might owe to Novell Inc. for improperly licensing an older version of the Unix computer operating system to other companies is minimal.
But Novell attorneys told U.S. District Judge Dale Kimball that the pre-1995 version of Unix to which it still holds the copyright, under an earlier ruling by the judge, was a substantial part of what SCO licensed in agreements with Microsoft, Sun Microsystems and other companies.
The two companies squared off in a scheduled four-day trial that stems from Kimball's Aug. 10 ruling that Novell still retained the copyrights to Unix when it sold the operating system software business in 1995.
The trial is the latest round in court over litigation that SCO began in 2003 when it sued IBM, arguing that IBM had used the Unix source code - the backbone of a computer operating system - to make enhancements to the Linux operating system that made it able to compete with Unix.
SCO sued Novell in 2004, saying Novell was interfering with ownership rights in the IBM case. But Kimball's Aug. 10 ruling made SCO potentially liable for up to $37 million in fees and interest for licensing the older system without Novell's permission or giving it a portion of the money collected.
Novell, however, began the trial Tuesday by dropping the amount it claims it is owed to $19.9 million, almost all of it from SCO's licensing agreements with Microsoft and Sun.
Novell attorney Michael Jacobs argued that SCOsource, the business unit formed to market Unix licenses, was based substantially on SVRX, the older version of Unix to which Kimball's ruling applies.
"SCOsource was all about SVRX," Jacobs told Kimball, who is hearing the case without a jury.
Jacobs argued that the value in the Unix licenses stemmed from the older version of Unix.
But SCO attorney Stuart Singer told Kimball that although the updates to Unix after 1995 for which it owns the copyright were built upon the older versions, those parts had virtually no value because customers wanted the updated versions.
"We submit there is no value beyond the minimal amount for the SVRX licenses," said Singer.
Kimball is scheduled to hear arguments today on Novell's motion that there is substantial evidence for the judge to decide in its favor.
Even if Novell wins a judgment, a Delaware bankruptcy court where SCO sought protection last year has retained control of SCO's finances and would have to approve any payout.
Unix is a computer operating system originally developed in 1969 by Bell Labs. Since then, multiple versions of Unix have been developed:
* Unix System V, or SVRX, is a version of Unix developed by AT&T and Unix Systems Laboratories.
* UnixWare is the name for more recent versions of Unix System V developed and licensed in the early 1990s by USL and Novell. UnixWare got its name because it was a combination of Unix System V code and some components of Novell's NetWare source code.
* In 1995, Novell sold the UnixWare business to The Santa Cruz Operation. Santa Cruz released several subsequent versions of UnixWare.
* The SCO Group, originally Caldera International, acquired the UnixWare business from Santa Cruz in 2001.
Source: Federal court files