SCO Targets Two in Linux End-User Lawsuits

UPDATE: The company files its complaints late Tuesday but postpones its official announcements until Wednesday morning.

The SCO Group will file lawsuits against two commercial Linux operating system users Tuesday night and announce their names Wednesday, officials said.

Company spokesperson Blake Stowell told the lawsuits had not been filed yet and would not be filed in Utah but would be before the courts closed for the day. At press time, courts on the East Coast and Midwest have already closed for the day, leaving only western states open to receive the filings.

Originally, the SCO Group had planned to file only one lawsuit Tuesday and announce the name of the company. The two companies they filed against will be publicly announced Wednesday morning in separate announcements, Stowell said.

The Lindon, Utah, company has long threatened to showcase a large Linux-using company with a lawsuit, but it has yet to follow through, instead concentrating on its $1 billion contract dispute against IBM .

In Las Vegas late last year, McBride said SCO would take the legal action in 90 days. The company also sent notices to Linux end-users warning them of the legal consequences of ignoring its licensing program.

While the IBM/SCO Group case slowly wound its way through pre-trial hearings, the SCO Group launched its IP licensing program to entice enterprise Linux OS users, with the caveat they would be susceptible to legal trouble if they didn't sign up for the program.

The program charges a $199 per desktop initial license as well as an additional $49 annual fee to use the SCO IP binary code. Server prices range from $699 to $4,999 for the initial license and annual fees of $149 to $1,079.

The first inkling the SCO Group was going to target Linux end-users came in May, when officials said Linux was an unauthorized derivative of UNIX, and that liability could extend to commercial users. In July, the company received copyright registrations for UNIX System V source code.

At the time, McBride said there were 2.4 million users taking advantage of his code to run the Linux operating system. "We expect SCO to be compensated for the benefits realized by tens of thousands of customers," he said.

But the claim is disputed. A couple of months before the SCO Group secured its copyrights, Novell (now in the midst of its acquisition of commercial Linux vendor SUSE) Chairman, President and CEO Jack Messman wrote an open letter to McBride saying that while the SCO Group may have bought UNIX System V code assets from them in 1995, the purchase not include copyright or patents.

SCO's latest legal stance comes two days after Texas Web-hosting house signed an IP licensing agreement worth more than $1 million. With the license, SCO Group officials say the hosted server company can legally use the Linux OS on their machines without incurring legal retribution.

The effectiveness of the license is somewhat debatable; the courts have yet to rule that any SCO-owned code has found its way into the Linux kernel, via IBM. Last week, Judge Brooke Wells allowed the SCO Group to include copyright infringement charges to its lawsuit after IBM said it wouldn't argue against the addition.

The original lawsuit was essentially a contract dispute, with the SCO Group maintaining Big Blue violated its licensing contract when it took UNIX System V source code and leaked it into an earlier revision of the Linux kernel code.

The case is bogged down in a fact-finding phase and the trial may not start until next year. The SCO Group has not been able to prove any of its code was used by IBM engineers to bolster the Linux kernel, saying it first needs to see IBM's code to determine where the actual infractions lie. The judge ruled the SCO Group would not see the code, and that it was dependent on the SCO Group to provide the evidence -- not IBM.

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