Don’t pay SCO without a refund guarantee

Software company SCO is suing IBM for billions of dollars and threatening users of Linux with legal action, claiming that IBM has...

Software company SCO is suing IBM for billions of dollars and threatening users of Linux with legal action, claiming that IBM has put parts of SCO’s intellectual property into the open source operating system.

Although Ovum analysts are confident that SCO will lose its case, this serves as an important warning about the potential dangers of downloading software with unknown origins.

In March 2003, Linux distributor SCO announced it was suing IBM for allegedly placing Unix code, to which SCO had obtained the rights via an acquisition, into Linux. At the time, SCO’s chief executive claimed that thousands of lines of Unix code had been copied into Linux by IBM.

SCO argued that IBM had deliberately set out to destroy it and asked for more than £1.67bn in damages. Not long after this, SCO began to threaten companies using the disputed versions of Linux with legal action unless they bought a licence.

As the dispute rolled on throughout 2003, SCO repeatedly claimed it had clear evidence that thousands of lines of code had been "misappropriated", but steadfastly refused to show anyone the smoking gun.

Since then, SCO has admitted that it does not have any proof that Linux contains sufficient original Unix code to make its claim viable. SCO is now asking the court for the right to scour all of IBM’s Unix source code (which consists of hundreds of millions of lines of code) to find some evidence.

SCO now insists that, under the original agreement IBM signed with AT&T, it owns all of the code that IBM subsequently wrote in addition to the original software product.

It is very unlikely that SCO’s line of argument in the court will prevail. SCO is asking the court to accept that the original licensing agreement, which related to a little under 100,000 lines of code, grants it control over the 63 million lines of code that IBM subsequently wrote to develop its version of Unix, AIX.

If the court were to accept SCO’s interpretation of the contract (and SCO’s interpretation is disputed by the people from AT&T who signed the original contract), the outcome would be truly bizarre.

To confuse matters further, SCO’s ownership of the Unix copyrights is being disputed by Novell (which bought Unix from AT&T) in another courtroom. Novell sold certain rights to the original Unix operating system to the Santa Cruz Operation (which was subsequently acquired by SCO).

Novell has claimed that the agreement allowed for the transfer of copyrights that were necessary for the Santa Cruz Operation to benefit from Unix, but that none were subsequently requested or transferred.

Unless SCO can convince the court that the agreement did transfer the Unix copyrights, then its case against IBM is likely to fail completely.

In the meantime, SCO continues to assert that users of Linux are legally obliged to buy a licence from it to use the operating system.

Given the confusing nature of the case and SCO’s claims, it is not surprising that very few Linux users have elected to take up SCO’s offer. Ovum’s advice to users remains the same today as

it was in June 2003 – do not pay SCO without a money-back guarantee.

Unless SCO is willing to guarantee a full refund to those companies which have paid for a licence in the event its court claims fail, it makes no sense to pay SCO for something that it alleges, but has yet to prove, that it owns.

Gary Barnett is IT research director at Ovum

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