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Eyewitness Reports from the DC Hearing - SCO Trounced

Wednesday, July 21 2004 @ 12:23 PM EDT

UPDATE: [5:41 PM]

Confirmation. Groklaw's champion courtroom eyewitnesses got it exactly right. You can read all about it in the media now, with confirmation from the court, DaimlerChrysler, and SCO, who are reportedly "examining their legal options", ha ha. First Stephen Shankland's account:

"The SCO Group, a struggling company with a loud campaign to profit from Unix intellectual property, has largely lost a case it brought against DaimlerChrysler.
"In a hearing Wednesday, Judge Rae Lee Chabot of Oakland County Circuit Court in Michigan granted most of DaimlerChrysler's motion to dismiss the case, SCO and DaimlerChrysler representatives said. . . .
"'The case "for the most part probably is' over, SCO spokesman Blake Stowell said.
"'We're satisfied that DaimlerChrysler did finally certify their compliance with the software agreement, but we are still interested in gaining some information on why they didn't certify within the allotted time,' Stowell said. The case 'is not completely over yet, because the judge still held out the possibility that we could pursue trying to find out information from DaimlerChrysler on why they took so long to certify.'"

Don't you love it? Maybe it took so long because they were doubled up on the floor laughing so hard, they couldn't lick a stamp.

And a second confirmation, from ComputerWorld:

"Michigan judge throws out SCO lawsuit against DaimlerChrysler
"Everything but one minor claim by SCO was rejected
"In a move that could have legal ramifications for a number of lawsuits filed in recent months by The SCO Group Inc., a Michigan judge today threw out SCO's lawsuit against DaimlerChrysler AG"

I do so thank our volunteers for taking time out to run to the court to be our eyes and ears, not only ours, but the world's, because I believe we had it first.

I have just heard from two readers who did attend the DC hearing. The eyewitness accounts are subject to later clarification, simply because neither is a lawyer and that can lead to missing certain details, as they disclaim in the reports. But with that disclaimer, this is what they say happened. I know we all wish to thank them both for attending the hearing, so we can get a fast report.

What they are telling me is that DaimlerChrysler's motion for summary disposition was granted in all particulars except one, which is whether they replied fast enough or should have done so within 30 days. What that means is SCO's action against DC is over in all meaningful senses. I can't believe they will wish to spend the money to litigate over something so trivial with no conceivable damages or useful relief, even if they were to prevail, and I doubt they could anyhow. Still, this is SCO, so we will have to wait and see. But the most significant thing is, they can't do discovery the way they seemed to hope to be able to do. How much discovery do you need to do about being 30 days late? The bottom line is they were, by both accounts, trounced and trounced good.

So you can get the full flavor of the day, here are both reports.

******************************

REPORT 1, from eggplant37:

Well, like a wolf at a corpse, Judge Chabot has eviscerated SCO's case against Daimler. Here's my narrative of what happened in court:

I arrived at 0800 to the courtroom and found that SCO v DC was 18th on the motion callsheet, nearly close to the end of the session, as there were only 22 cases to be heard this morning. . . . DC's lawyers were rather jovial during the checkin period prior to court being called into session, and SCO's attorneys looked rather concerned but cool about it. Mark Heise reminded me of Superman actor Chris Reeves in appearance. Ryan Tibbits reminded me of a big, blocky Marine drill instructor as to his appearance.

The courtroom didn't open up until 0820 and I watched the various attorneys, both from the SCO v DC case and several other cases being heard this morning, as they checked in. At 0841, the clerk called the SCO v DC attorneys up for a brief discussion, during which I was able to overhear the clerk tell them that he would "like to get [them] in and out."

At 0850, the clerk came over to the SCO side of the bench and spoke briefly with them, telling them "five minutes", I think stating the amount of time that each side would be granted for arguments. DC's attorneys came over and confirmed with the SCO attorneys what the clerk had to say.

Court was called to session at 0905. Judge Chabot is a petite woman with a very short, close-cropped hairdo, and looked determined and no-nonsense in her affect. Judge Chabot heard and ruled on a motion in the first case heard in less than 30 seconds, which seemed to surprise both attorneys in that case. One attorney in that first case jokingly commented that she hoped that this ruling would set precedence in how speedily cases would be heard this morning, which was met with laughter throughout the courtroom.

Second case was heard at 0906, third case at 0917, fourth case at 0921, fifth case at 0931, 6th case at 0940 and 7th case at 0942, so this shows that Judge Chabot is one speedy lady who doesn't muck about while running her courtroom.

SCO v DC was called at 0942. Barry Rosenbaum arguing for SCOand James Feeny arguing for Daimler, and motions were heard to admit Heise and Steven Prout?? pro hac vice for SCO, and also to admit Mark Matuschak from Massachussetts pro hac vice for Daimler, which the Judge granted.

First, DC's lawyer argued Daimler's summary dispo motion, noting from the outset that this was a more technical case, dealing with software and licensing agreements, and that he would frame the case briefly, in about 30 seconds. Chrysler says that the case is about whether or not section 2.05 of the SA requires a certification of compliance with detailed enumeration of extraneous facts outside the agreeement, or whether it simply requires a brief certification that licensee has complied with the terms of the license agreement.

Mr. Rosenbaum then went on to recite the language of Section 2.05. He stated that the letter requesting the certification from SCO went quite far outside the unambiguous language in section 2.05 when it asked to enumerate information regarding DC's use of Linux. Daimler didn't file the certification until after SCO filed it's lawsuit, which on its face appeared to be about the contract provisions being breached due to DC not giving SCO their compliance certification in a timely fashion.

Mr. Rosenbaum then went on to recite paragraphs 2 & 3 of DC's response letter, stating that there were *no* cpu's running SCO's software, that not providing a list of cpu's that weren't in existence and hadn't been used in more than 7 years was more than sufficient to comply with the language of 2.05. Since the language of 2.05 is unambiguous, there is sufficient grounds to grant summary judgement on all assertions in SCO's complaint.

Mr. Rosenbaum's presentation was clear-cut and concise, and he finished by stating that the original letter didn't request a list of CPU's running SCO's software. Since there were no CPU's running SCO's products, DC felt it was immaterial as to whether or not they responded within 30 days.

At 0951, Mark Heise then argued the SCO side of the case. He asserted that he would be brief, which surprisingly enough he was. He felt that DC's SA gave them full access to the source code, the crown jewels if you will, and that DC had been given the right to use, modify and create derivatives for their own internal use, and that the SA required that they keep the software confidential, that it should not be exported outside the US -- which in this case seems to be a concern since Chrysler's recent merger with Daimler Benz of Germany. He also used his favorite tagline about the concepts, methods, etc that they are looking to protect in this case.

As Mr. Heise argued, Judge Chabot was looking less than impressed and certainly not entertained by SCO's argument. Heise went on to argue the point that DC's answer to the request for certification was not timely nor was it adequate in that SCO has fears that the source code still lives on disk on some computer somewhere at DC and they are entitled to know where it's stored. He also stated that DC is not alleviated from the terms of the SA once they have decided to take the CD's or tapes or whatever of the source code and toss them in a closet somewhere, and that they needed full certification that the software had been held in confidence by DC.

He went on to recite the terms of section 6.02 of the SA, stating that Chrysler, upon ceasing use of the software, was bound to either destroy all copies or return the software and to notify SCO that they did same. Again, he expressed his concern that in DC's use of the Linux software they were worried that they may be allowing SCO's methods and concepts out into the Linux community. He concluded that the fact that the client has not used the software in 7 years there is still no out from the original contract terms. He finalized that they would like to know, again, which CPU's that the source code is stored on, seeming not to believe that since decommissioning SCO's products, the software isn't loaded *anywhere* on DC's equipment.

At 0959, Mr. Rosenbaum was given another minute to answer SCO's arguments, and broadly stated, "Your Honor, this is a fishing expedition." In the original complaint, there was no claim that DC had exported the software or disclosed it to anyone outside the company, that the case is about DC's breach of section 2.05 of the SA. The language of the 2.05 section has nothing about a certification that DC kept the software confidential, at which point the judge looked rather amused.

At 1000 Judge Chabot issued her orders:

Summary disposition is granted except on the matter of breach of section 2.05, in that DC did not submit their response in a timely manner. All other claims were dismissed and she acknowledged that the contract doesn't require certifications that are outside the language of the contract. . . .

At this point, the court session was concluded and the judge left the room. I headed toward the door and proceeded to congratulate the DC attorneys. The SCO attorneys all looked rather discomfitted by the Judge's rulings, realizing that she just gutted their case. I could almost hear the screaming all the way from Utah.

So, there it is. I'm hoisting a beer in celebration as I write this. Congratulations again to Daimler Chrysler and their attorneys for very successfully trouncing this case, whittling it down to the only possible claim that SCO could have -- that DC should have answered up more quickly.

****************************

REPORT 2:

As far as I can determine, the DC's request for summary disposition has been granted. The only remaining issue is whether 30 days is an adequate time to respond.

Now take it from me with a pinch of salt, because I have never been in a court and don't understand legalese too well.

Before the judge came in, the clerk told the parties that they had 5 minutes each to plead the case. DC went on first. DC stuck to the facts. Never mentioned Linux.

SCO was up second. SCO went beyond the boundaries of the case, just as in the filed doucments, about "just specifying a list of CPU is not enough" , "what if the was exported to Germany for e.g., since Daimler is German" "even if it isn't used, but sitting on a server somewhere, who knows what will happen", "what if they used the source code and made derivative works out of it", "what if they contributed to Linux?" , "DC has to certify all these issues we are raising now.". So they went on like this for a while on topics that aren't supposedly covered in section 2.05 or the agreement. DC did a brief rebuttal, mainly about the fact that it's about 2.05, and that all the arguments that SCO is putting forth have nothing to do with 2.05, DC also mentioned to the court that SCO was on a fishing expedition by bringing up all the other issues.

Then the judge ruled without further questioning. Apparenly, she had done her homework and read up about it and made up her mind, and none of the morning's arguments changed her mind. She had a prepared ruling and read from it, That's why I couldn't get it all inside my head, she read it too fast. But I seem to hear that except for the 30 day limit specified by SCO, DC's motion for summary disposition was granted, effectively throwing out SCO's case. I seem to hear that SCO could litigate whether 30 days was adequate or not. As for the other contract issues not covered by 2.05, the judge says, well, it is not part of this case. I will have to wait for the official ruling transcripts to be absolutely sure about what I heard.

Four attorneys from DC were there, and four from SCO. Heise was there. There was another attorney who came in separately and introduced herself to the entire DC team, but sat apart and did not partake in the arguments or in the other cases for the day. I suspect that she might be from IBM or Novell or Redhat.

I had the impression that Judge Chabot was a no-nonsense type that did not suffer fools too well. I got this impression from the other cases that she was ruling this same day before this SCO case -- she was pretty sharp to the lawyers. But on the SCO case itself, she did not need to cut off any of the attorneys on either side.

Neither side brought up the other cases, IBM, Novell, or Redhat. Linux got mentioned only by SCO in a contrived way during SCO's arguments.

Eyewitness Reports from the DC Hearing - SCO Trounced | 550 comments | Create New Account

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OT and links, please

Authored by: overshoot on Wednesday, July 21 2004 @ 12:55 PM EDT

keep it neat, people!