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First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Tuesday, September 18 2007 @ 11:53 AM EDT

We have the first report from the bankruptcy court, where SCO's initial hearing took place at 8:30 AM, from Groklaw member bezz:
Just back from the hearing and -- short story -- SCO got pretty much everything they wanted. Novell asked for a trust, but the judge denied it saying if he granted on the basis of what they presented, it would be preferential treatment. The judge invited Novell to file a motion to lift the stay in the Kimball trial and he would consider it at that time. Novell assured him they would file the lift stay motion and they will be back in Wilmington.

Keep in mind that no important motions were heard today. That happens at the next hearing. This was about paying sales taxes and not shutting off utilities. However, Novell did show up to let the judge know they want their money. The judge asked them to present a motion, and they will.

And here's a second report:

The Hearing only lasted one hour. Nothing major decided. Novell will submit a motion for releasing the stay on the trial scheduled for yesterday, and we are fairly certain that will be cleared to proceed. Darl McBride was in attendance although didn't say much.

Attorney Spector for SCO did most of the talking. Novell right on target although repeated many points. SCO spewed same stuff we have heard many times before. SCO STILL does not admit that Sun & M$ licenses were owed to Novell.

The first 7 people in the courtroom were Groklaw'rs!

Next hearing will be October 5th, at 1:30 pm, with Singerman replacing Spector for that Hearing, due to schedule conflict. (Wedding!) Singerman was remote on phone for today's hearing.

Frank found information on the trustee. He is Joseph McMahon, US Trustee, Trial Attorney, Wilmington DE. That means SCO misspelled his name, I'm afraid. Here's some more on what that role is. This explains why the DOJ was listed on the SCO filings.

Update 2: I have the longer reports from two of our eyewitnesses, and they've ordered a transcript for us also. First, from MikeD, who had a chance to talk to Darl McBride after the hearing:

There were 7 of us Groklawer's there. We all met and had breakfast after the hearing. We even got a picture of us all for PJ.

Short version - SCO got $20k approved for temp accountants and approval to pay their employees. That's it. Novell asked for some things and got nothing.

Court began at 8:30

Mr. Singerman participated for SCO on the phone.

Mr. Spector spoke for SCO first. He gave some background on SCO. Last 3 months $7.4 million last year; $4.7 million this year. Last nine months $21.9 million last year; $16.7 million this year.

Spoke of decline in business due in part to competition.

Spoke of SCO Mobile which could put them in league with Microsoft/Rimm/Motorola.

SCO has $2 million in debt.

Said 7 out of ten big business run on -Novell- servers. Another attorney ran up and whispered to him and he corrected that to say 7 of 10 run on SCO servers.

Said Linux is competition and "is a knock off of Unix".

Spoke about how their companies are worried about their continued operation.

Ms Jones then spoke for SCO.

Made some mention of "Epic" as an agent that I did not get.

Mr. Spector spoke again.

Requested SCO be allowed to use current business forms until they are used or 30 days?

Said he had discussions with Mr. McMahon. Mr. McMahon is apparently the assigned trustee.

New forms will have DIP (Debtor in Possession).

Larren Nashelsky spoke for Novell

- here to protect Novell's rights and property
- mentioned that SCO filed BK the day before the trial was to begin in Utah
- Gave background

Novell sold certain rights to SCO. Money is supposed to go to Novell and SCO gets 5%. Spoke about Judge Kimball's 102 page ruling that said Novell owns SVRX and patents. SCO "impermissibly" retained fees. Trial which was to start Monday was to determine what portion of those fees were owed to Novell.

What Novell wants:

  • "liquidate claims" (allow trial to go forward)
  • "where is our money"
  • "trial with Kimball should go forward to determine amount owed"
  • There should be no predetermination as to Novell's rights and property.
  • Novell's money should not be used for running SCO during bankruptcy.
  • All royalties should be turned over immediately.
  • Other than their 5%, SCO should not be allowed to use any of Novell's money.
  • Trial is needed to determine amount of money SCO has not turned over.
  • Judge Kimball found SCO had not turned over the appropriate fees from Sun and Microsoft.
  • Novell is NOT trying to stop SCO bankruptcy.
  • Novell wants their money which is not SCO's to spend.

Mr. Spector spoke again for SCO:

Items Novell is discussing took place in 2003.

The purchase agreement that was decided upon by Judge Kimball was extremely confusing.

Kimball did not grant constructive trust.

SCO does not have a problem with Novell's requests. Agreed to forward royalties minus 5% going forward.

Mr. Nashelsky: -95% of fees are Novell's and should be turned over to Novell.

- It's Novell's money and never was SCO's money.

- Novell's money should not be commingled with other money in bankruptcy (We discussed this at length at breakfast and others will comment - they used "commingle"many times in their discussion.

- Judge Kimball found $$$ were improperly converted and that the trial was to determine exactly how much of that money was rightfully Novell's.

- Asked the court to put Novell's money in escrow.

Judge Gross:

(speaking to Novell) Understood their position. However, it was 1st day of bankruptcy and it was not appropriate for him to rule on their request as "other debtors could be in the same position."

He ruled that he would enter the judgment as entered by SCO for now.

Mr. Nashelsky again asked that Novell's 95% be paid to them during bankruptcy.

The Judge said that his order will not prejudice Novell.

Mr. Spector spoke about ongoing business. Spoke about accounting people leaving and year end (Oct.) looming, requested temp employees.

Mr. O'Neil spoke for SCO and said they needed $20k for accounting temps through October.

The Judge said he felt that was appropriate.

Ms. Jones spoke for SCO and asked permission to pay sales and use taxes. ($54k/$9,300)

Judged granted

She asked that SCO be allowed to pay approx $6k on a $10k debt for utilities because there were concerned "the lights would be shut off".

Judge granted

Mr. Spector asked the judge to accept Darl McBride's declaration.

Judge granted.

Next hearing is 10/5 at 1:30 pm. Objection and motion deadlines are 10/2.

There were seven of us there, Other than the lawyers I believe there were only 3 or 4 other people there.

I tried to watch and listen to the players to get a feel for them.

The judge appeared friendly but very business-oriented. It appeared to me that he had prepared for this case. He had no trouble understanding what was going on and seemed to have a grasp of the background of the SCO saga.

Mr. Nashelsky for Novell was sharp as a tack. He was well prepared and went straight to the point.

Mr. Spector stumbled a few times while speaking. IMHO he was not nearly as prepared as Novell for this proceeding.

Several of us spoke to some of the Novell lawyers. I spoke with Julie Dyas. I asked if she had really got her law degree and PhD in the same year. Yes she did. I had printed the Novell Lawyers pictures the night before. She did not have a picture posted. She is an attractive young lady. I am not sure what her role is but in watching her I can tell you you want her on YOUR side in court. She was laser-like in her concentration. Ever meet a person where you just get the feeling "this is not some one to mess with"? - that was my impression of Julie.

I asked her why Novell had not challenged SCO's bankruptcy since they had more money than debt (for now). She told me this was not the time or place for that kind of challenge since it was the first bankruptcy proceeding.

It did not appear that Novell had a problem with SCO filing bankruptcy. They just want their money. Novell was clearly pushing to get the issue of how much they are owed back before the court. Our breakfast consensus was that they want the issue decided by Judge Kimball.

Some of us (the Groklaw 7) introduced ourselves as Groklaw followers. The Novell attorneys clearly know what that means. They all smiled when we said it.

After the hearing I introduced myself to Darl McBride. I told him I was one of those Groklaw people. He smiled and told me he admired our passion. There is a time and place to ask a CEO questions and a courthouse hallway is not the place to ask tough questions. I asked Mr. McBride how he was holding up through this ordeal. He told me that he knew it would be tough. He said that what he had not expected was the toll it has taken on his family. When he said that I was looking him in the eye and there was a brief sadness in his eyes and a quiet voice that surprised me. I wished him and his family well. As a human being, he seemed to be a nice guy. If only he had chosen a different path .....

All in all it was pretty dull. SCO had their bankruptcy application rubber stamped. I suspect we will see the fireworks beginning with the motions due 10/2 and the next hearing on 10/5. Novell clearly wants its day in court to decide how much money SCO owes them. The judge today gave no indication of how that may play out in the future.

And here is bezz's longer report:

The judge entered at 8:33. Laura Davis Jones began by thanking the judge for taking time out from a trial for today's hearing and introducing Darl McBride, Ryan Tibbetts, Arthur Spector, Stuart Singer and James O'Neill (already known to the judge). Singerman was on the phone. Mr McMahon (did not catch first name) is the US Trustee. Present for Novell were Larren Nashelsky, Julie Dyas and a gentleman whose name I did not catch.

Jones began for SCO with the Eqiq motion (12) which was granted.

Spector took over for SCO describing the business. Revenues for the latest reported quarter were $4.7 million vs $7.4 million for the previous year's quarter. For the previous 9 months, $16.7 million vs. 21.9 million for the previous year's 9 months. He stated SCO Mobile is a very lucrative asset because in many parts of the world people do not have desktop computers and rely on cell phones; SCO is targeting this market for future growth. SCO's UNIX assets are very valuable and between them and the Mobile business, SCO has a great potential for growth in the future. SCO has no secured debt and $2 million of trade debt.

He went on to say seven out of ten retail systems use Novell technology (OOOPS! SCO, not Novell); the whole courtroom got a chuckle out of that slip. McDonald's and the US Military are examples of the very large and potentially lucrative users of SCO technology.

But, over time revenue has slipped from $230 million to $20 million. That is due to competition, particularly from Linux, which SCO claims is a knock-off of SCO's UNIX. SCO has been spending a lot of money to compete, including a significant amount on PR and that is important for SCO going forward.

SCO has filed for Chapter 11 bankruptcy in order to get its day in court so management can work on new products and wishes to keep disputes in bankruptcy court for resolution.

Jones then resumed for SCO and addressed the Joint Administration of Cases motion (2) which was granted.

Spector then addressed the Business Forms, Employee wages and Temporary Accounting Staff motions (7, 8 and 14) which were granted. Mr. McMahon, the US trustee requested they add DIP to their stationary when the existing stock is exhausted. SCO is addressing cash flow issues with Mr. McMahon, too.

Novell then began with Mr. Nashelsky. He stated Novell does not oppose Chapter 11, but wishes to preserve its rights on counterclaims. Novell bought UNIX in 1993 and sold certain rights to SCO's predecessor in 1995, retaining other assets as its own. SCO began the litigation in Utah in 2004, and SUN and Microsoft gave money to SCO for UNIX licenses; under the August 10 decision, Novell owns the copyrights and the Sun and Microsoft funds were converted. The only things left to resolve in a 3 to 4 day bench trial was how much SCO owed for wrongfully retaining Novell's money and whether SCO had the right to enter into those license agreements in the first place.

He then asked the judge to lift the stay on the trial to determine how much SCO owes. The property (money) is not SCO's, but Novell's. There is no dispute that the SVRx money is Novell's and it should be turned over to Novell immediately. Kimball so ruled -- it was a breach of fiduciary duty. SCO is liable for a constructive trust and the trial was to determine how much. Novell is still demanding (and yet to receive) an accounting to determine what part of the money is Novell's.

Spector then responded for SCO. He wants a formal motion for a lift stay (as opposed to today's verbal). All this happened in 2003 on a very confusing 1995 APA. He also claimed that Novell employees have interpreted the APA in the same way as SCO. The August 10 ruling in Utah was a shock to SCO since they had so much evidence in support of their interpretation. Spector stumbled over the name of the Utah Court judge and the Bankruptcy judge reminded him it is Kimball.

Nashelsky then replied for Novell. The 95-5 split is clear. SCO knows the accounting but has comingled our property with theirs. SCO is trying to use Novell's property. They are not asking for an injunction -- the amount of the trust is to be determined and should be put in escrow by Judge Kimball's determination.

The judge then stated that Novell's request would give Novell priority as a creditor and if he granted it, then everybody coming in front of his bench would ask for the same.

Nashelsky replied that it is their money, it can be escrowed and SCO concedes it is Novell's money.

The judge ruled that Novell is not being prejudiced by the denial of a constructive trust and invited them to file a lift stay motion to proceed in Utah in front of Kimball. Nashelsky replied that he would file and will be seeing the judge again.

Spector for SCO then addressed some payroll issues and stated there will be layoff and severance issues to address to which US Trustee McMann and Novell concurred. They lost line employees in accounting and not the CFO, so they need some temps to get out the Annual Report to the SEC. The judge granted all those requests.

Jones for SCO then addressed the tax and utilities motions (9 and 10) which the judge granted.

Spector for SCO asked to admit McBride's First Day Pleadings (3) which the judge granted.

The next hearing date was set for October 5 at 1:30 PM. Spector has a wedding to attend, but Singerman will fill in for him. The Objection deadline is set for 4 PM October 20.

At 9:30, it was over.

The impression I get from our reports is that the judge isn't ready to rule on anything substantive until he's up to speed. His worry that there could be other creditors with a claim equal to Novell's is an example. That doesn't mean Novell lost. It means that he wants to see a motion in writing. There was no time for motion practice prior to this hearing, but now the judge wants to see this dispute on paper, and no doubt SCO will respond with any other creditors that might be on an equal footing. I know of none. And that gives other creditors a chance to tell their story to the judge. They all get notices in the mail. So I'd say it is off and running.

Also, you see now what happens when a Groklaw volunteer meets up with Darl McBride. He treats Darl with the respect to which all humans are entitled, and the fellow feeling. All that "most hated man in tech" FUD was never true. It's about the company to us, or I should say the policy of the company, not the individuals.

And here's a report from a third attendee, Groklaw member sylvester:

Boy that was fun, even if the whole thing on the face of it was a non-starter. The Groklaw'rs had no trouble meeting up beforehand, and familiarizing themselves with the surroundings. There were seven of us who identified ourselves to each other, and we spread around the audience area, which was composed of 12 padded benches that could have comfortably seated 60 people. Besides us, there were a couple of gentlemen that appeared to be friendly with the attorneys in front of the bar; they just sat in the middle of the audience and watched. And independent of each other, in the back of the room, a man and woman tethered to the sole electrical outlet, typing feverishly on their laptops throughout the proceeding, who bolted as soon as the hearing was over. Darl left the courtroom as soon as the proceeding was over and milled about the lobby, perfectly willing to exchange pleasantries while the lawyers finished up inside; he pitched the super short form of his argument with the outward conviction that he truly believes what he is saying.

On the right side of the audience, (stage left) those present for SCO were Laura Davis Jones who opened and moderated throughout; Arthur Spector who did most of the addressing the court; Darl McBride himself, who said nothing, and looked like he was struggling to summon up a smile when his attorneys pointed to him as the CEO; and Ryan Tibbits, Stuart Singer & James O'Neill who did not address the court openly.

On the left side of the room the names I caught were Larren Nashelsky who did most of the talking for Novell; Michael Nestor; and Joe McMahon (United States Trustee) who occasionally spoke tersely just to confirm one thing or another. There were several others present with them, but the introduction went by so fast I couldn't capture them.

Attorneys for SCO spoke first.

Ms. Jones spoke first, lots of thank you's and introductions up and back, a particularly big one for the judge opening up a spot on his calendar on short notice after the filing on Friday.

Essentially, Mr. Spector delivered the content of the Darl McBride's prepared declaration in support of first day pleading. He spoke of SCO as a formerly great company with an overriding fiduciary duty to its shareholders, creditors and customers. He portrayed the company as essential to "McDonald's, NASDAQ , and thousands of mid to large customers... to say not a company without significant impact on world economics."

He heavily pitched SCO Mobile as a viable company product offering, capable of supporting the future of the company, if given the chance to mature and evolve. He described it a leading edge voice mail service, citing its use in hurricane ravaged Florida, and "in India, where there are potentially a 100 million people" to deliver their service to. This he postulated, would be the basis for them being a "profitable, tax-paying and wage-paying company," who he cited IDC as calling SCO "among leaders such as Microsoft, RIM and Motorola."

And of course, he attributed the decline of the SCO business to competition from Linux, "which is at least partially, a 'knock-off' of UNIX. And they [Linux] fought back hard. With a very large PR budget."

In summary he stated the objective is to stabilize the company, to ensure their day in court on a number of issues. To give them some 'breathing space'. And to "protect its customers." They promised they intend to keep the lines of communication open with the US Trustee, Joe McMahon. To put a "DIP" (Debtor In Possession) imprint on any new forms and stationary orders, although they tongue-in-cheek "hoped to have matters resolved before the current stock is exhausted."

Novell responded after the first volley

Mr. Nashelsky indicated that Novell is not here to oppose SCO bankruptcy, but are "here to protect and preserve Novell's rights." And on the eve of the case going to trial for the counterclaims, SCO initiated this proceeding. Briefly gave a synopsis of the history of UNIX ownership and the APA in "not too much detail or debating..." the events of the past. He basically repeated the same mantra over many times in referring to SVRx royalties. "It's Novell's property, SCO collects it, SCO administers it, but it's Novell's property."

He spelled out the high points of Judge Kimball's Aug 10th, 102-page ruling denying SCO's summary judgment motions; granting in part for Novell; declaring Novell the rightful owner of the copyrights, SVRx royalties; and the Sun and Microsoft deal "impermissibly converted Novell's property." "What Novell wants... Judge Kimball... lift the stay and liquidate the counter-claims.. . trial to only last 3 to 4 days."

He took issues with the cash management piece. "...will prejudice Novell's right to Novell's property... Novell holds equitable title... No dispute, SVRx royalties, Novell retained. SCO collects 100% and receives 5% administrative fee."

Also took issue with SVRx royalties not turned over being commingled with other monies, that Novell is the equitable owner of the funds. That SCO breached fiduciary duty in SUN and Microsoft deal. That Judge Kimball ruled SCO's "conduct sufficiently wrongful to impose a constructive trust" and that the trial that was to have happened yesterday was to have decided the amount owed. ...until that determination is made, to prohibit SCO from using those funds, and that they be held in escrow and that they provide a detailed accounting of royalties. "We have a right to our property."

Mr. McMahon and the SCO attorneys got up to speak here and there about this and that had been discussed and resolved. Mostly related to expenditures. $20K authorized for accounting temporaries. Something about a "30 day waiver of 345 agreements". And some glowing compliment to McMahon about noticing the differences between 507-A4 and 507-A5 whatevers. Something about dollar amounts. I also recall the touting of "management's wisdom" of having made payroll the day before filing, so that is not presently the issue.

Judge Gross thanks the attorneys for their input.

The judge prefaced his ruling by indicating that although he appreciates Novell's position, he is reluctant to offer them any special treatment here, lest everyone coming into his court would now be begging for the same handling of their cases. As such, he ruled to "enter the order as presented."

Mr. Nashelsky took another swing at the ball by expressing concern of the SVRx royalty revenue stream, Novell's property, the 100% collected less 5% administrative fee, being commingled with other money in SCO's general coffers, and that at least it be ordered that they keep those funds in separate accounts. The judge indicated that he was satisfied that it had been this way all along, and that there was sufficient oversight of the process to maintain the status quo. He basically said he was reluctant to take an extraordinary step of granting Novell any affirmative measures at this point. As far as lifting the stay on the proceedings in front of Judge Kimball, that would be something better left for Novell to make a motion on. Mr. Nashelsky concurred and assured him that it would be forthcoming.

The whole thing took almost an hour, which judging from the new wave of attorneys rolling in at 9:30 for the next proceeding, makes me deduce that it ordinarily would have been a fifteen minute rubber-stamp procedural exercise.

The team then grabbed some food and coffee, shared our observations and discussed our opinions, sent PJ whatever we could from the road, ordered the transcripts, and headed home.

Commentary

All in all, the middle of the road opinion [mine] is that it met my expectations. I got the feeling that this type of filing is normally a no-brainer, and the Judge Gross was not about to upset the normal way of doing things, in a one-hour initial session. It's also my opinion that SCO bought themselves another short delay, but it will be back in a Utah courtroom eventually anyway. They're pushing Judge Kimball to show yet a little more tolerance of their behavior. I trust that if Judge Kimball has not been goaded into lashing out at them yet, he will continue to have the patience of a saint, and in due time administer the cold-hearted justice they so richly deserve.

It was interesting to see Darl in person, well worth the price of admission. I got the impression he genuinely believes (maybe having lied to himself for so long, it seems true) that he "owns" what he claims as his. He did not exude any of the arrogant confidence he has shown in the past. Rather, he came off as a wounded general who, although he started the war with a shock and awe attitude, has lost his whole army under the fatigue of real fighting, and is now desperately trying to preserve what little he has left, and cheat the hangman. But since this is bankruptcy court, I guess that it all meets expectations, too.

Here are some new filings, including a sign-in sheet showing what lawyers were there today. I note David Melaugh of Morrison & Foerster was there, in addition to the bankruptcy specialists from his firm, as was Stuart Singer from Boies Schiller for SCO:

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

24 - Filed & Entered: 09/17/2007
Auto-Docket of Credit Card
Docket Text: Receipt of filing fee for Voluntary Petition (Chapter 11)(07-11337) [misc,volp11a] (1039.00). Receipt Number 3054513, amount $1039.00. (U.S. Treasury)

25 - Filed & Entered: 09/18/2007
Order on Motion For Joint Administration
Docket Text: Order Authorizing Joint Administration of Related Chapter 11 Cases: 07-11337 and 07-11338. An order (the "Joint Administration Order") has been entered in this case directing the joint administration of the chapter 11 cases listed below. The docket in case no. 07-11337 should be consulted for all matters affecting this case. The following chapter 11 cases are jointly administered pursuant to the Joint Administration Order: The SCO Group, Inc., Case No. 07-11337; and SCO Operations, Inc., Case No. 07-11338. (Related Doc # [2]) Order Signed on 9/18/2007. (LCN, )

26 - Filed & Entered: 09/18/2007
Motion to Maintain Bank Accounts
Docket Text: Order Authorizing the Debtors' (I) Maintenance of Existing Bank Accounts, (II) Continued Use of Existing Business Forms, (III) Continued Use of Existing Cash Management System, and (IV) Limited Waiver of Section 345(b) Deposit and Investment Requirements. (Related Doc # [7]) Order Signed on 9/18/2007. (Attachments: # (1) Exhibit A) (LCN, )

27 - Filed & Entered: 09/18/2007
Order on Motion to Authorize
Docket Text: Order (I) Authorizing the Debtors to (A) Pay Prepetition Wages, Salaries, Commissions, Employee Benefits and Other Compensation; (B) Remit Withholding Obligations; (C) Maintain Employee Benefits Programs and Pay Related Administrative Obligations; and (II) Authorize Applicable Banks and Other Financial Institutions to Receive, Process, Honor and Pay Certain Checks Presented for Payment and to Honor Certain Fund Transfer Requests. (Related Doc # [8]) Order Signed on 9/18/2007. (LCN, )

28 - Filed & Entered: 09/18/2007
Order
Docket Text: Order (I) Authorizing the Debtors to Pay Prepetition Sales, Use and Similar Taxes and Regulatory Fees in the Ordinary Course of Business and (II) Authorizing Banks and Financial Institutions to Honor and Process Checks and Transfers Related Thereto. (related document(s)[9] ) Order Signed on 9/18/2007. (Attachments: # (1) Exhibit A) (LCN, )

29 - Filed & Entered: 09/18/2007
Order
Docket Text: Order Authorizing and Approving the Retention of and Appointing Epiq Bankruptcy Solutions, LLC, as Noticing, Claims and Balloting Agent. (related document(s)[12] ) Order Signed on 9/18/2007. (LCN, )

30 - Filed & Entered: 09/18/2007
Order
Docket Text: Order (INTERIM) (I) Prohibiting Utility Providers from Altering, Refusing or Discontinuing Service, (II) Deeming Utilities Adequately Assured of Future Performance, and (III) Establishing Procedures for Determining Adequate Assurance of Payment. (related document(s)[10] ) Order Signed on 9/18/2007. (Attachments: # (1) Exhibit A) (LCN, )

31 - Filed & Entered: 09/18/2007
Minute Entry
Docket Text: Minutes of Hearing held on: 09/18/2007
Subject: FIRST DAY MOTIONS and FIRST DAY MOTIONS. (vCal Hearing ID (57050)). (related document(s) [15]) (SS, ) Additional attachment(s) added on 9/18/2007 (SS, ).


  


First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings | 662 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections here
Authored by: Erwan on Tuesday, September 18 2007 @ 11:56 AM EDT
If any.

---
Erwan

[ Reply to This | # ]

OT, the Off topic thread
Authored by: Erwan on Tuesday, September 18 2007 @ 11:59 AM EDT
Remember, some like clickies...

---
Erwan

[ Reply to This | # ]

News Picks Discussions here.
Authored by: Erwan on Tuesday, September 18 2007 @ 12:00 PM EDT
As usual now.

---
Erwan

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:03 PM EDT
I'll be there for the next one, already clearing the deck!

How did Darl look?

[ Reply to This | # ]

So what does it mean?
Authored by: Jude on Tuesday, September 18 2007 @ 12:08 PM EDT
> Next hearing will be October 5th, at 1:30 pm, with Singerman
> replacing Spector for that Hearing, due to schedule
> conflict. (Wedding!) Singerman was remote on phone for
> today's hearing.

Does this mean October 5th is the earliest date on which the bankruptcy court
will consider allowing the other lawsuits to continue?

[ Reply to This | # ]

Damn!
Authored by: dobbo on Tuesday, September 18 2007 @ 12:08 PM EDT

More delay, delay, delay

Dobbo

P.S. PJ, I used the word "damn" here not as a swear word but to express that todays decision in court is bad, or unfit for a speedy end to this whole saga. And if you believe that I have some shares in a certain Utah based company that I can let you have cheep ($5 each) because in a little while they are going to be worth millions. :-)

[ Reply to This | # ]

But not everything they wanted (yet)
Authored by: bjnord on Tuesday, September 18 2007 @ 12:10 PM EDT
SCO got pretty much everything they wanted.
If I'm reading the minutes correctly, it looks like at least three things SCO asked for, related to their desire to have 4+ law firms involved and being paid, were deferred to the Oct. 5 hearing date. So they have Epiq Bankruptcy Solutions, but they don't yet have approval for some of the others, including Berger Singerman.

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:11 PM EDT
I'm surprised Novell didn't have that motion already compiled, and they just
needed to fill in some blanks, and take it to the clerk to file right there in
the courtroom. Seems like such a highpowered team would have been prepared to be
denied on the first attempt. Delaware is a business friendly place so this
should have been expected.

[ Reply to This | # ]

First In The Courtroom
Authored by: BassSinger on Tuesday, September 18 2007 @ 12:11 PM EDT
"The first 7 people in the courtroom were Groklaw'rs!"

So, how many of them were wearing red dresses?
;-}) <= Handlebar mustache above the grin

---
In A Chord,

Tom

"We cannot solve our problems with the same thinking we used when we created
them." -- Albert Einstein

[ Reply to This | # ]

Catch-up time
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:11 PM EDT
This judge sure has a lot to learn about this case.

BTW, how are judges selected for cases? Is it just a rotation? Or what else?
I was just wondering, because this case has oodles of twists and turns and if
there was any intelligence to the process I would have thought that a much more
seasoned judge would have been assigned. I am not saying this judge can't
handle it, just that he sounds kind of green. I wonder if he has any idea how
many people are watching what he is doing?


[ Reply to This | # ]

Oh Dear
Authored by: DaveJakeman on Tuesday, September 18 2007 @ 12:12 PM EDT
It looks like this judge has a lot to learn about the SCOG.

---
Monopolistic Ignominious Corporation Requiring Office $tandard Only For
Themselves

[ Reply to This | # ]

IP Only?
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:14 PM EDT
Is there any chance SCO could reinvent itself as an IP only company? It
certainly would decrease their expenses. And really, what's the long term
viability for SCO's software products?

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Novell rescuing money before it's spent.
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:15 PM EDT
The earliest date for paying the newly appointed "advisors" is the
25th October which gives Novell until then to obtain a ruling which keeps
"their" money safe from SCO spending it on their friends. I am
wondering whether it is feasible that the trial can be arranged and concluded by
that time.

The trial was ready to go but expected to take three weeks so I figure the
pressure is really on Novell to get a motion before Judge Gross and have the
stay lifted. Counting three weeks back from 25th puts us at 4th October. I guess
Novell would be hoping to get something arranged to start next week or they'll
be cutting it mighty fine. Assuming the stay is lifted, I will not be surprised
to hear SCO request for a delay in the trial because they, and BSF, are involved
in Chapter 11 proceedings and cannot devote time to the litigation.

-----------------------
Nigel Whitley

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and we are fairly certain that will be cleared to proceed
Authored by: ChocoNutDancer on Tuesday, September 18 2007 @ 12:16 PM EDT
"Novell will submit a motion for releasing the stay on the trial scheduled
for yesterday, and we are fairly certain that will be cleared to proceed."

When someone who was there gets the chance to read GL could they expound on the
"fairly certain" statement bit? Was it a gut feel, something the
judge said, the way he said it, etc?

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Disappointed...
Authored by: veatnik on Tuesday, September 18 2007 @ 12:22 PM EDT
I figured that a motion from Novell to allow the trial to continue (lift the
stay) in SLC would be the top priority. Sad to see that the Judge had to ask
them to file this motion.

Given that going backrupt might not even be warrented if the resulting amount is
zero and that chapter 7 would be the result if Novell gets what it thinks SCO
owes it I am suprized that the Judge just didn't lift the stay so things can
proceed properly. (Perhaps a motion from someone is required before he could
lift the stay?)

Looks like the effect is more delay. (Oct 5th, it will seem like an eternity!)


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First Word From the Bankruptcy Court Hearing
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:23 PM EDT
Well it looks like SCO is down the drain and the IBM trial will never happen.
Good riddance to an annoying pest like SCO.

Only thing that bothers me - have we *finally* proven with all the proceedings
up to now that Linux is squeaky clean and free of any of the so-called
"Unix IP" in the eyes of the world and the courts? One thing that the
IBM trial would have done is settle this matter once and for all.

We have no worry from Novell (I hope) trying to claim "Unix is in
Linux", but have we really achieved a state where Corporate America as well
as the average Joe that considers Linux on his system feels comfortable that
they won't suddenly get a letter from some legal firm telling him to start
writing checks up to some "SCO-Source" like scam?

-dh

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Questions, questions...
Authored by: Anonymous on Tuesday, September 18 2007 @ 12:51 PM EDT
There are so many things about all this I don't understand, and hope the
clued-in folks here will explain. I see a lot of complaints here that SCO got
everything they wanted. But I only see one thing that bugs me, and that is that
they apparently are being allowed to get chapter 11 protection without ever
admitting that they owe Novell any money; but the one and only thing that makes
them insolvent is the money they owe Novell.

Does SCO have to establish that they are insolvent? Or are they presumed to
have the right to file under chapter 11, until somebody else (e.g. Novell)
convinces the court otherwise?

I skimmed through the orders from today, and nowhere do I see the court saying
"Yes, you have the right to declare bankrupcy." Maybe this is the
same as my first question -- do you have to prove anything at all to be allowed
to file under chapter 11?

And would I be right in guessing that Novell's motion to lift the stay will have
to be fully briefed and argued before it's decided? So it's going to be months?
And what are the circumstances that permit the stay to be lifted -- what does
Novell have to argue?

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How does the law handle this?
Authored by: Jaywalk on Tuesday, September 18 2007 @ 12:55 PM EDT
Okay, we effectively have a case here where someone stole some money and then filed for bankruptcy. Now the thief is saying that the money should be used to pay off their creditors in a reorg, rather than given back to the victim.

Should the victim be treated like just another creditor?

---
===== Murphy's Law is recursive. =====

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LOL: Joseph McMahon signed himself as representing Novell...
Authored by: Anonymous on Tuesday, September 18 2007 @ 01:00 PM EDT
To be more accurate he ditto'd under a few dittos representing Novell.

I'm sure SCO will love the thought he is representing Novell :-)

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Other parties?
Authored by: Anonymous on Tuesday, September 18 2007 @ 01:01 PM EDT
Was IBM represented? How about Red Hat?

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I expect this is just a short break...
Authored by: Anonymous on Tuesday, September 18 2007 @ 01:04 PM EDT
The SCO/Novell trial will likely restart and finish within the month -- so that
the Bankruptcy trustee can determine the complete list of liabilities. This
will make Novell the largest liability by far.... eventually giving them much
more power.

Cc

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Unixware, SCOserver and
Authored by: Anonymous on Tuesday, September 18 2007 @ 01:04 PM EDT
Whatever other incarnations they have...

When they go belly up, who will be supporting businesses that still use them.
The 3 big companies(from a Canadian point of view) are McDonalds, Shoppers Drug
Mart and The Source.

Thanks.

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Who gets the keys to the door and the till?
Authored by: Guil Rarey on Tuesday, September 18 2007 @ 01:05 PM EDT
Admittedly, I haven't had time to go through all the filings - were SCO
management appointed trustees as debtor-in-possession or was a separate trustee
named?

How hard will it be to dislodge Darl, Ralph & Co. once the judge actually
reads Novell's filings? Does anyone know? Speaking of Novell's filings, have
they shown up on PACER yet? I have to believe that Novell is absolutely utterly
unsurprised by all of this and their filing was basically waiting a final edit
for the exact language of SCO's filings. So it should be in soon.

---
If the only way you can value something is with money, you have no idea what
it's worth. If you try to make money by making money, you won't. You might con
so

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A question!
Authored by: Nick_UK on Tuesday, September 18 2007 @ 01:09 PM EDT
So, SCO owes Novell monies that SCO [illegally] obtained from Microsoft et al.
That has now been deemed correct.

What would have happened if SCO never started the litigation and yet till
obtained licences to stuff they never had the right too?

Did they wake up the sleeping giant through all their litigation? Would have
Novell have even cared until they had to care?

Nick

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Credit card?
Authored by: Architeuthis on Tuesday, September 18 2007 @ 01:55 PM EDT
They don't even have a thousand dollars for the filing? On the other hand, maybe
they received one of them "zero interest until July 2008" offers and
figure they won't have to pay the principal anyway, for reason of not existing
at that point.

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Kimball wants this out of his court
Authored by: Anonymous on Tuesday, September 18 2007 @ 02:35 PM EDT
Kimball has probably spent as many sleepless nights as PJ reading and trying to make sense of all this crap.

In the mean time he's presided over some other important cases including those that have victims of violent crime.

All the while the SCO boys have harassed him by dragging this spurious lawsuit into his courtroom.

[ Reply to This | # ]

  • I doubt that.... - Authored by: Anonymous on Tuesday, September 18 2007 @ 03:07 PM EDT
    • I doubt that.... - Authored by: Anonymous on Wednesday, September 19 2007 @ 09:42 AM EDT
OUCH... this BK judge *does* know what's happening:
Authored by: Anonymous on Tuesday, September 18 2007 @ 02:50 PM EDT
From the eye-witness report:

"Spector [for SCO] stumbled over the name of the Utah Court judge and the
Bankruptcy judge reminded him it is Kimball."

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Flexibility of the Bankruptcy court?
Authored by: kh on Tuesday, September 18 2007 @ 03:09 PM EDT
In a normal court case once the court has ruled made/ruled it can't be changed.
At least only by an appeal or a retrial.

I would imagine that a bankruptcy court would need to have a bit more
flexibility to adjust it's rulings if, for instance, it finds evidence that the
company lied or omitted to tell the court things.

Is that the case?

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Any Favorites?
Authored by: Anonymous on Tuesday, September 18 2007 @ 03:11 PM EDT

Here's my favorite:

    SCO has filed for Chapter 11 bankruptcy in order to get its day in court!
Ok... let's get this straight. SCOG had a four-day trial starting on Mon. If they had gone that path, it would be over in a few days and they could begin filing their appeals.

Instead, to "get their day in court", they filed for bankruptcy the previous Fri. which effectively stayed the trial.

Well... I guess we'll find out if SCOG opposses Novell's request to lift the stay. If they oppose, they certainly do not want "their day in court" no matter how many times they make that statement.

RAS

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SCO ME
Authored by: Anonymous on Tuesday, September 18 2007 @ 03:13 PM EDT
"Spoke of SCO Mobile which could put them in league with
Microsoft/Rimm/Motorola."

Oh come ON! Has anyone even seen a single SCO ME product? It's like Darl woke
up some day and said "We are going to rule the mobile business, even though
we couldn't succeed at our core businees, or the litigation business"

I can start making an abacus which could "put me in league with
TI/Casio" for calculators?

[ Reply to This | # ]

  • SCO ME - Authored by: Anonymous on Tuesday, September 18 2007 @ 03:22 PM EDT
  • SCO ME - Authored by: Anonymous on Tuesday, September 18 2007 @ 03:38 PM EDT
    • Re:SCO ME - Authored by: Anonymous on Tuesday, September 18 2007 @ 09:07 PM EDT
  • SCO ME - Authored by: chuck on Tuesday, September 18 2007 @ 03:47 PM EDT
    • SCO ME - Authored by: bb5ch39t on Tuesday, September 18 2007 @ 04:07 PM EDT
      • SCO ME - Authored by: Jimbob0i0 on Wednesday, September 19 2007 @ 08:41 AM EDT
    • SCO ME - Authored by: Anonymous on Tuesday, September 18 2007 @ 07:02 PM EDT
      • SCO ME - Authored by: Anonymous on Wednesday, September 19 2007 @ 12:44 AM EDT
  • SCO ME - Authored by: snakebitehurts on Tuesday, September 18 2007 @ 03:50 PM EDT
  • SCO ME - Authored by: Anonymous on Tuesday, September 18 2007 @ 04:29 PM EDT
  • Hang on - Authored by: Anonymous on Tuesday, September 18 2007 @ 10:37 PM EDT
Chapter 11 vs. 7
Authored by: SLi on Tuesday, September 18 2007 @ 03:16 PM EDT
As I understand it, the point of Ch 11 vs. Ch 7 is that the company might be
worth more in the whole than the sum of its possessions. If that's true,
wouldn't it be more appropriate to, in the end, give Novell the entire
possession of SCO and let Novell put it into pieces if they so wish? Or would
Chapter 7 with Novell as the sole creditor to receive anything do just that?

Another note: Can anyone figure any other reason apart from open contempt of
court why SCO would leave the "wherefore we petition this court..."
part out from the notice filed in the Novell court, given it filed two notices
in IBM and Autodesk where there was that part?

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: drh on Tuesday, September 18 2007 @ 03:18 PM EDT
The first few comments I heard were somewhat disappointing, so I decided to wait
a bit and see what more came in. Glad I did.

So far this looks like the BK judge is being cautious, and doing only what he
deems is needed at the moment. The things SCO received appear to be standard
stuff, and do not help or harm anything. Novell being put off to another day is
appropriate for the moment, allowing the judge time to get a larger picture.
While we all are getting pretty well disgusted with the delay and SCOs less than
honorable conduct, the court appears to have acted professionally.

The only thing that really stood out to me were the comments about Novell
getting preferential treatment if their motion was allowed to carry. That does
not sound right to me, they should go first, it is their money and that has
already been decided.

Now we all have to wait and see what happens.


---
Just another day...

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Will a slow boat to S.America get there by October 5? n/t
Authored by: Anonymous on Tuesday, September 18 2007 @ 03:27 PM EDT
.

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Did they say "conversion"?
Authored by: bjnord on Tuesday, September 18 2007 @ 03:28 PM EDT
The judge then stated that Novell's request would give Novell priority as a creditor and if he granted it, then everybody coming in front of his bench would ask for the same.

Nashelsky replied that it is their money, it can be escrowed and SCO concedes it is Novell's money.

My big question is: Did Novell use the magic word "conversion" as they spoke? As I understand it, that word is hugely important in how the bankruptcy judge will view Novell's situation as being different from every other creditor.

[ Reply to This | # ]

Thank You Delaware 7
Authored by: rsteinmetz70112 on Tuesday, September 18 2007 @ 03:28 PM EDT
I appreciate each of you taking the time out to attend and let us know how
things went.

I am curious about how you recognized each other.

---
Rsteinmetz - IANAL therefore my opinions are illegal.

"I could be wrong now, but I don't think so."
Randy Newman - The Title Theme from Monk

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Bankruptcy == cards on the table
Authored by: Anonymous on Tuesday, September 18 2007 @ 03:30 PM EDT

I'm definitely not an expert... but doesn't bankruptcy mean that all creditors
have to come out of the woodwork?

So any connections between SCO and their various rumored backers should now
become open knowledge. No?

[ Reply to This | # ]

It's A Moot Point, But Perjury, Maybe?
Authored by: sproggit on Tuesday, September 18 2007 @ 03:38 PM EDT
From the sworn declaration of Darl McBride, in support of the 1st day pleading:

B. Events Leading to SCO's Filing of Chapter 11 Case

i. Competition

34. Sales of SCO's UNIX-based products and services have been declining over the last several years. This decline in revenue has been primarily attributable to significant competition from alternative operating systems, particularly Linux.




OK, so we've been through this [and chortled merrily] at this one before, but how close is this to outright perjury?

Please help correct any errors I make in the following observations:

1. According to SEC Filings, The SCO Group are on record as saying that, prior to the year in which they received payments from Microsoft and Sun, they had no record of profitable operations. Moreover, since those payments, they have had no record of profitable operations.

2. At the time that The SCO Group decided to launch the first of their legal suits [against IBM] the company were at the time participating in the GNU/Linux marketplace, with their own distribution. They had also been a founder member of the UnitedLinux consortium [along with SuSE and others]. It was the decision of the existing Management Team, including the present CEO Darl McBride to (i) launch suit against IBM and (ii) withdraw from the GNU/Linux technology marketplace [a market that is proving highly lucrative to IBM, Novell and others].

3. Despite the on-going cases [or perhaps even because of them] the worldwide market for GNU/Linux sales and services has grown year on year since the 2003 launch of suit against IBM.

4. Each of the technology companies with whom The SCO Group are engaged in litigation [IBM, Red Hat and Novell] are reporting profitable returns from their respective GNU/Linux business. [I don't want this comment to appear to be sniping, but:] This statement is also (I believe) true for Novell, which caused a certain amount of concern in the FOSS community after a 2006 deal with Microsoft.

5. Of all of the technology companies involved in these various SCO-related lawsuits [and to this author's knowledge all technology companies involved in the provision of GNU/Linux related products and services] The SCO Group are the only vendor which has, in the past 4 years, sent "alarmist" [wanted to use the word 'threatening', but decided not to!] letters to the top Fortune 1000 companies, setting out an intention to sue all companies using the GNU/Linux Operating System that failed to purchase SCO "licenses".

6. Of all the technology companies involved in these related lawsuits, The SCO Group are the only one which has actually sued customers [Autozone and Daimler-Chrysler], though the author concedes that these cases appear to be moot since the indicated parties appeared to have ceased used of any *Unix* product prior to commencement of their respective cases.



In short then, SCO Group CEO Darl McBride produces a clear an unequivocal testimony in a Court [a Bankruptcy Court, but a Court nonetheless] and states for the record that despite some illustrative evidence listed above, he claims proof positive that the mere existence of Linux in the marketplace was sufficient to drive The SCO Group to the verge of bankruptcy.

With the recent disclosures of the very small number of shareholders [400-ish] the probability of a shareholder lawsuit is zero - especially as the chances are that Yarro and other execs hold a sufficient quantity of shares to veto any such calls - and I wonder what the rules of the company require as a percentage of the vote, and if that percentage was changed recently.

So McBride has admitted that under his stewardship, The SCO Group turned it's corporate back on the one market to which they had ready access and to which there was and continues to be strong growth. He further characterizes "GNU/Linux" as being an external competitor, without being willing to acknowledge earlier support for the technology.

He further remains in denial that any of the fortunes of The SCO Group since he took the helm has been as a direct result of his utter and blatantly obvious incompetence.



I do appreciate that the 'form' of a bankruptcy court is very different to the civil court in which Judge Kimball has been presiding over the disputes, but in my simplistic way of thinking, Darl's statement, in this case, is no different from that quaint and inevitable, "Yes, and I'd have gotten away with it, if it wasn't for you pesky kids!" that we all used to look forward to at the end of an episode of Scooby Doo. [Sorry, appreciate that's somewhat childish, but Darl really does bring out the juvenile in people, doesn't he?]

Back to being serious just for a moment. IMHO there is a considerable body of evidence - not just that we've reviewed within the context of the trials themselves, but throughout the associated technology markets, that indicate to me that The SCO Group have made a steady stream of economically suicidal business decisions, ever since Darl McBride became the CEO.

I do appreciate that the sworn testimony he gave the BK Judge has less to do with my opinion than it does to attempting to ensure that he is not held personally liable for failing to act in the best interests of shareholders, or any one of another potentially serious charges that could be brought against him as an individual director of The SCO Group.

But seriously, what responsibility does a bankruptcy court have to examine and confirm the truthfulness of statements such as this?

Can we hope that Novell will challenge it with a filing of their own? Perhaps they could find expert witnesses - say a Gartner consultant or independent market observer - to refute McBride's claims? Or could another party do so?

Finally, what would be the consequences to Darl in the event that a challenge was made an upheld? Would that really count as perjury, or would he just be told to stay behind after court and get 500 lines or something?





Speaking as an outside observer and non-US citizen, I admit to being quite amazed to the degree with which a legal system [and let's not single out the US system here - I suspect *most* legal systems strive for fairness] can be vulnerable to what is nothing more than systemic abuse.

It clearly isn't enough to game the civil courts. Now we have the same MO in bankruptcy.

Sheesh.

[ Reply to This | # ]

Litigation in India
Authored by: Anonymous on Tuesday, September 18 2007 @ 03:39 PM EDT
Has anyone found any info on SCO's India litigation?

I know that there was something about an India case way back when this started,
but the brief tidbit I saw the other day seemed to be much more recent.

Does anyone know what its about? Is it the same case as before, or something
new?

[ Reply to This | # ]

SCO Spent a Cool Million Today
Authored by: DaveJakeman on Tuesday, September 18 2007 @ 03:52 PM EDT
Well OK, not today, but they've been authorized to - according to SCOBK-27.pdf:
$1,145,780.

They just *love* spending Novell's money.

---
Monopolistic Ignominious Corporation Requiring Office $tandard Only For
Themselves

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: Anonymous on Tuesday, September 18 2007 @ 04:00 PM EDT
"It's about the company to us, or I should say the policy of the company, not the individuals."

There is no such thing as a "company". That collective noun refers to an imaginary concept which has no referent in reality. "Companies" do not exist -- only individuals exist. A "company" did not make the decision to lie, steal and commit fraud -- certain individuals did. A "company" did not erroneously believe someone else's property belonged to them -- certain individuals did.

"Responsibility is a unique concept. It can only reside and inhere in a single individual. You may share it with others, but your portion is not diminished. You may delegate it, but it is still with you. You may disclaim it, but you cannot divest yourself of it." - Admiral Hyman Rickover

Ignoring this concept, and trying to evade responsibility, causes much evil.

"Do not give in to evil, but proceed ever more boldly against it." - Ludwig von Mises

[ Reply to This | # ]

Thank you MikeD
Authored by: Ninthwave on Tuesday, September 18 2007 @ 04:05 PM EDT
Thanks to MikeD for introducing himself to Darl and the attorneys in a manner
that shows the quality of the open source community.

---
I was, I am, I will be.

[ Reply to This | # ]

  • Hear Hear - Authored by: pointman on Tuesday, September 18 2007 @ 05:07 PM EDT
  • Thank you MikeD - Authored by: Anonymous on Tuesday, September 18 2007 @ 07:02 PM EDT
  • Thank you MikeD - Authored by: Anonymous on Wednesday, September 19 2007 @ 04:49 AM EDT
thanks for the first-person reports
Authored by: john82a on Tuesday, September 18 2007 @ 04:10 PM EDT
Apologies if this been said already, but I'd also like to add my admiration for
MikeD's sensitivity and tact towards Darl. In conversation, many of the things
said about him may be disgraceful (but funny); I think Darl - for all his faults
- will have recognised that his fantasies about addled Kumbiya hippies were
sorely misplaced.

john

[ Reply to This | # ]

This really gets my hackles up:
Authored by: DaveJakeman on Tuesday, September 18 2007 @ 04:10 PM EDT

Spector:

SCO has filed for Chapter 11 bankruptcy in order to get its day in court so management can work on new products and wishes to keep disputes in bankruptcy court for resolution.
Arrrrgh! SCO admit it.

They didn't like the way things were going in their litigation, so did whatever the heck they had to to get out of Kimball's courtroom.

SCO weren't bankrupt; they only would have been at the end of the four-day trial.

So now they think they can stave off nasty Kimball rulings indefinitely, whilst they go about their business.

All I can say is, I'm looking forward to seeing what SCO have to say in reply to Novell's motion to lift the stay. Almost as much as I'm looking forward to Kimball welcoming SCO back into his courtroom for their "day in court".

Snort.

---
Monopolistic Ignominious Corporation Requiring Office $tandard Only For Themselves

[ Reply to This | # ]

People are easily deceived by a master
Authored by: Anonymous on Tuesday, September 18 2007 @ 04:18 PM EDT

Mr. McBride....a brief sadness in his eyes and a quiet voice that surprised me. I wished him and his family well. As a human being, he seemed to be a nice guy.

Sigh.

Mr McBride is a master of deception. His resume shows that he has no useful abilities, but he can talk himself into top executive jobs paying $200k+ salary plus $200k+ bonuses. The people who put him into those jobs are better at judging people than you are or I am, but he still took them in.

Naive people think that they are good at judging whether a person is honest, "a nice guy", or not. Kids, you are very bad at it. Mr McBride can deceive you without even trying. It comes as naturally as breathing to him.

Ignore the "brief sadness in his eyes", "quiet voice" - anyone with any talent for acting can pull those. Look at the facts. Look at the proven lies (some still on SCO's website, btw). Look at the sheer malevolence of the game plan - which was to steal the work of the people who built GNU/Linux and get rich in the process.

Do not look at Mr McBride's facial expression or tone of voice.

[ Reply to This | # ]

I have a question
Authored by: Jude on Tuesday, September 18 2007 @ 04:20 PM EDT
SCO filed for chapter 11, but AFAIK the requested status isn't automatically
granted. Is SCO actually in chapter 11 now that we've had today's hearing?

[ Reply to This | # ]

Question for the G7
Authored by: Nivag on Tuesday, September 18 2007 @ 04:28 PM EDT
Or more properly, a question for the Magnificent Groklawyeren 7:

What was the Judges reaction to:

(1) the number of people turning up?

(2) the size of Novell's legal team?

(3) the Groklawyerians?

How did SCOundrel's lawyers react to the presence of the Groklawyerians?


Thanks for turnig up G7!

Nivag

[ Reply to This | # ]

Did SCO say anything about lifting the stay?
Authored by: Anonymous on Tuesday, September 18 2007 @ 04:33 PM EDT
When the judge denied Novell's verbal motion and said that they should file a
motion in writing to lift the stay of the Utah trial, did anyone from the SCO
side say anything about objecting to such a motion?

It appears that bankruptcy court is a little diffrent than a civil trial, in
that the judge can make decisions without the regular
"Motion...Response...Reply", so does this mean that he could grant
Novell's motion for the lifting of the stay, once they file it in writing,
without waiting for any objections from SCO?

[ Reply to This | # ]

Delay tactics opinion
Authored by: Anonymous on Tuesday, September 18 2007 @ 04:42 PM EDT
IANAL. (Sorry in advance for (most likely) incorrect terminology.)

I have briefly spoken with my friend who had tough luck going thru two BKs over
here in Europe. Things might be different, but I guess one bit can be common.

PJ sounded doubts about trustee made of seven larges creditors of SCO. Because
most of the creditors are "friends" of SCO.

My friend was to the similar situation. And he also didn't get as he believed
everything owed from his employer. When he spoked to people who were running BK
process, he was told that he would need to go to BK court and file the plea.
From his words it was pretty easy. During the BK process he got 2/3 of money
company owed to him automatically. After liquidation, some money were set aside
for claims like my friend had brought up. And several month later court ordered
trustee to pay him the rest of money ex-employer owed. (In Germany, ex-employee
claims seem to have priority over other creditors.)

IOW, the trustee board made of SCO friends wouldn't be able to do much against
Novell claim. In Germany, you can't even delay BK process. If public company
started reorganization under BK protection, the process cannot be stopped nor
reversed. If filed claims would amount, troubled company wouldn't be given any
chance to really reorganized, since it wouldn't be able to come up with any
sensible reorganization plan which might bring the money back. Plan has to have
very low risk.

There are exceptions, when company has established product on market and
continuing sales and support of the product might be a sensible strategy. But in
case of SCO, it doesn't have any highly valued product (*). IOW, with high
probability SCO would be simply liquidated: assets would be auctioned, gained
money would be divided between its creditors.

Basically, company under BK protection isn't run by company management anymore.
Darl/friends would have little say. In Germany it even can be ordered to drop
ongoing cases. That actually might happen to SCO: to save on lawyer's fees.

(*) Product in development wouldn't count, since it has way too high associated
risks. Some other company also might jump in and buy assets and credits of SCO -
to pick up the prospective development - but then it would have to pay Novell
the money SCO owes. No way to avoid that. I doubt anybody would want to buy SCO
in such an uncertain financial situation.

[ Reply to This | # ]

Investors think Novell will get some money
Authored by: Anonymous on Tuesday, September 18 2007 @ 04:54 PM EDT

SCO's market cap (total price of all their shares) closed well below the company's book value today (roughly, the book value is what would be left of the assets after paying off all the loans and debts). That means the marketplace thinks SCO is going to have some "liabilities" that are not presently in its accounts.

[ Reply to This | # ]

If the stay is lifted ...
Authored by: Anonymous on Tuesday, September 18 2007 @ 05:18 PM EDT
If the BK court grants that the Novell Stay be lifted, can the Utah court begin
by immediately ordering a constructive trust, even before the actual amount owed
Novell is determined?

After all, the reason behind the trust was the possibility of bankruptcy - that
is now a certainty so there is a very compelling reason to order a CT. If the
Utah court does so order, does that tie the hands of the BK court, or is it
somehow a higher court that can undo such a ruling?

I don't think it's likely that Kimball would make a swift move like that, I'm
just wondering if it is a legal possibility and what the ramifications would
be.

[ Reply to This | # ]

If I met Darl.....
Authored by: bobn on Tuesday, September 18 2007 @ 05:18 PM EDT
If I met Darl, I would not be able to resist asking "Where are the
deep-diving MIT mathematicians?" - over and over and over again.

Yes he's human. But he is a bad human. He is a really good reason against the
existence of the "corporate veil".

---
IRC: irc://irc.fdfnet.net/groklaw
the groklaw channels in IRC are not affiliated with, and not endorsed by,
either GrokLaw.net or PJ.

[ Reply to This | # ]

SCO still trying to confuse issues
Authored by: Tsu Dho Nimh on Tuesday, September 18 2007 @ 05:32 PM EDT
"He went on to say seven out of ten retail systems use Novell technology (OOOPS! SCO, not Novell); the whole courtroom got a chuckle out of that slip. McDonald's and the US Military are examples of the very large and potentially lucrative users of SCO technology."

He means they use LINUX, and isn't admitting that Kimball ruled that SCO doesn't hold copyrights to it.

[ Reply to This | # ]

McBride is responsible for the actions of SCO
Authored by: dobbo on Tuesday, September 18 2007 @ 06:14 PM EDT
All that "most hated man in tech" FUD was never true. It's about the company to us, or I should say the policy of the company, not the individuals. - PJ

PJ. I have yet to see any company be able to make any decision or policy on its own. Companies are staffed by people and it is the people that make decisions and policies. As CEO McBride is responsible for the actions of his company and those it employs.

One of the better bosses I have had once made it very clear the difference between responsibility and authority. Authority can be delegated, responsibility can not.

As I said, at about the time the time the magnificent seven were sitting down to breakfast, I thought that McBride was deluding himself about the facts about Unix and who owned it. MikeD's report on his conversation with McBride only confirms my impression of the man. One of the things I doubt McBride understands is the passion the community feels towards our creation.

I feel no sympathy for McBride, he must bear the consequence of his actions. His press releases and other public statements are witness to the fact that he support and endorses the actions his company have undertaken these last four years. Actions that, as CEO, he is ultimately responsible for. I do feel sympathy for any innocent members of his family that have suffered as a result of McBride's actions, but not for the man himself.

To MikeD and the other six, I thank you for taken the time to attend and report on the events in the court today.

Dobbo

[ Reply to This | # ]

"It's about the company not the individuals."
Authored by: ak on Tuesday, September 18 2007 @ 06:18 PM EDT
PJ wrote:
He treats Darl with the respect to which all humans are entitled, and the fellow feeling. All that "most hated man in tech" FUD was never true. It's about the company to us, or I should say the policy of the company, not the individuals.
The company is led by certain individuals. Darl McBride is one of them. He lied about copyright violations in Linux. He should be treated as a human, yes, as a human who was and is involved in fraud and extortion.

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: Pogue Mahone on Tuesday, September 18 2007 @ 06:21 PM EDT
Looks like Burnham Wood has finally come to Dunsinane.

For those who don't recognise the context, may I repeat a post of mine from 2004?

Macbride - A Tragedy

(Note for theatre directors: In some circles it is considered bad luck to refer to this play by name. It is therefore recommended to refer to it as "The SCOttish Play"

ACT I. SCENE I.

A coutroom place. Thunder and lightening.
Enter three Lawyers.

FIRST LAWYER. When shall we three meet again?
In thunder, lightning, or in rain?

SECOND LAWYER. When the memorandum's done,
When the motion's lost and won.

THIRD LAWYER. That will be ere the set of Sun.

FIRST LAWYER. Where the place?

SECOND LAWYER. Before the bench.

THIRD LAWYER. There to meet with Macbride.

FIRST LAWYER. I come, MikeAnders.

ALL. Ballmer calls. Anon!
Fair is foul, and foul is fair.
Hover through the FUD and filthy air.

---
(c) 2007 Typo, Inc. All rights reversed.

I'm not afraid of receiving e-mail from strangers - see bio

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: kurtwall on Tuesday, September 18 2007 @ 06:54 PM EDT
I asked Mr. McBride how he was holding up through this ordeal. He told me that he knew it would be tough. He said that what he had not expected was the toll it has taken on his family. When he said that I was looking him in the eye and there was a brief sadness in his eyes and a quiet voice that surprised me. I wished him and his family well. As a human being, he seemed to be a nice guy. If only he had chosen a different path...

I'm sorry for the toll its taken on him and his family. This has affected lots of other people and their families, too. It has resulted in two suicides, ruined numerous careers, smeared many reputations, and destroyed at least one company. These are all regrettable.

Yet, at the end of the day, Mr. McBride and the other inhabitants of the boardroom brought this on themselves. They made the decision to go down this path; no one forced them to undertake this ruinous course of action. They are simply reaping the harvest they have sown. That the bad actors did not foresee and now regret the consequences of their actions proves only that they are human; it does not excuse their actions.

I can (no, must) forgive them. But forget and excuse? Negative.

[ Reply to This | # ]

What's Yarro doing, btw?
Authored by: Anonymous on Tuesday, September 18 2007 @ 07:36 PM EDT
If Novell only gets 50% of the license payments, there's no equity in SCO
anymore and the shareholders will be left with empty hands. Ok, the media
interest in this case has been less than stellar, but at least som IT
publications have reported. and always the same sentence: No SCO spokesperson
could be reached for comments. Ok. But what about the single big shareholder,
who had also greatly influenced SCO's ways in the past? What about Ralph Yarro?
Why hasn't anybody tried to reach him? For god's sake, check google news search.
Only a single Australian website even mentions his name! Where is he, when his
old company is sinking???

[ Reply to This | # ]

Does Novell Really Care?
Authored by: TheBlueSkyRanger on Tuesday, September 18 2007 @ 07:41 PM EDT
Hey, everybody!

Uh, oh. My Ranger sense is tingling.

Okay, Novell wants their money.

Why?

Suppose they don't get the money due them. SCO is still ground into dust, Linux
is still safe, legally, Novell has everything they need, they don't really need
the money from the licenses to stay in operation. They aren't asking for
declarations or anything like that, just the cash. Since the cash won't matter,
SCO is going down one way or the other, why are they doing it? Is it as a
warning to other companies who might try playing fast and loose? Or am I just
looking too deep at something that doesn't need it?

Dobre utka,
The Blue Sky Ranger

[ Reply to This | # ]

SCO Employees
Authored by: MrCharon on Tuesday, September 18 2007 @ 08:02 PM EDT
Do we have some SCO employees who hang out here? What is the water cooler talk
like right now?

---
MrCharon
~~~~

[ Reply to This | # ]

  • SCO Employees - Authored by: Anonymous on Tuesday, September 18 2007 @ 08:09 PM EDT
    • No - Authored by: Anonymous on Tuesday, September 18 2007 @ 09:54 PM EDT
    • SCO Employees - Authored by: Anonymous on Thursday, September 20 2007 @ 02:03 AM EDT
  • SCO Employees - Authored by: LionKuntz on Tuesday, September 18 2007 @ 10:28 PM EDT
  • SCO Employees - Authored by: Anonymous on Wednesday, September 19 2007 @ 11:27 AM EDT
No analagous "creditors"?
Authored by: Anonymous on Tuesday, September 18 2007 @ 10:48 PM EDT
OK. So what I'm getting here is that Novell is not trying to stop the chapter 11
bankruptcy-- they're just trying to impose the additional condition that they
get the money that is theirs regardless of SCO's bankruptcy status. As I
understand what the observers said, the judge has left the door open to imposing
the trust to give them that money, but refused to do so until he could have time
to consider the request in writing and know whether any other creditors might
show up asking the same status. The groklaw analysis seems to be that there
wouldn't be any other such creditors. Do I have this right so far?

Okay, so that's Novell. What I'm trying to figure out is what other creditors
(besides Novell, with their not-quite-creditor status) Groklaw readers would
tend to care about. Would chapter 11 bankruptcy shield SCO from being awarded
damages from IBM, or RedHat, or Autozone, based on the ongoing lawsuits with
those parties? If so, is there anything IBM, RedHat, or Autozone can do to
involve themselves in the bankruptcy proceedings in hope of preventing SCO from
slipping away from the consequences of their actions?

[ Reply to This | # ]

Pity for Darl's Family
Authored by: Anonymous on Tuesday, September 18 2007 @ 11:09 PM EDT
He said that what he had not expected was the toll it has taken on his family. When he said that I was looking him in the eye and there was a brief sadness in his eyes and a quiet voice that surprised me. I wished him and his family well.

I am an independent consultant and I suffer financially when I must devote hours to exposing and countering Darl Mcbride's lies about software technology before I can even begin to help my clients make proper decisions.

Darl McBride has attempted to provide for his family by snatching the bread from the mouths of mine. If he is financially ruined and must suffer the scorn of his disgusted wife and the spite of his deprived children, it is no worse than what he intended for me.

-Wang-Lo.

[ Reply to This | # ]

I wonder if this Judge knows Sco just made him a celebrity!
Authored by: Anonymous on Wednesday, September 19 2007 @ 12:06 AM EDT
Thousands of Groklaw fans around the world know his name, and will eagerly read
his every word.

[ Reply to This | # ]

there were 7 groklawyers there, and Darl
Authored by: Anonymous on Wednesday, September 19 2007 @ 01:41 AM EDT
and you didn't break into an impromptu "Kumbaya"

oh, man ....

[ Reply to This | # ]

I *think* Novell DO CARE what happens next...
Authored by: GriffMG on Wednesday, September 19 2007 @ 04:14 AM EDT
Taking the thief analogy literally, tSCOg have 'stolen' Novell's money (by
conversion and comingling?).

If only half is still available in cash, they can chase and recover some of the
balance in other ways... if McSnide got paid an enormous bonus for landing the
M$ and Sun payments - which he knew weren't tSGOgs to keep - perhaps Novell can
try to put a lien on his own personal funds... if he used some of it to buy a
house, perhaps it can be confiscated...

It MAY even be possible to try and recover monies from BSF - up to the date of
Chpt 11 anyway!

If Novell want to they can probably make this very personal indeed - even
without sanctions and criminal charges. Think what an example that makes to any
future attacker...

---
Keep B-) ing

[ Reply to This | # ]

"Several of us spoke to some of the Novell lawyers."
Authored by: Anonymous on Wednesday, September 19 2007 @ 04:51 AM EDT
Can Groklaw afford their time?

[ Reply to This | # ]

Follow the Money
Authored by: DaveJakeman on Wednesday, September 19 2007 @ 05:37 AM EDT
In SCOGBK-27.pdf, SCO say what they are going to spend money on:

Prepetition Independent Contractors: $50,000
Prepetition Reimbursement Obligations: $15,000
Prepetition U.S. Commissioned Employees: $101,000
Prepetition Foreign Commissioned Employees: $193,160
Prepetition Foreign Employee Wages: $173,000
Prepetition Medical Plan: $93,000
Prepetition Dental: $9,000
Prepetition Life, ADD and Disability Insurance Expenses: $7,700
Prepetition Paid Time Off – U.S. (allow accrual, but not pay): $351,000
Prepetition Paid Time Off – Foreign (allow accrual, but not pay): $111,420
Retirement Savings Plan: $41,500
Total: $1,145,780

There's one number there that leaps off the page: US Paid Time Off: $351,000.

Let's look at that in relation to employee pay:

US Commissioned + Contractors (assuming contractors are US): $151,000
Foreign Commissioned + Wages: $366,160

So, Foreign pay is roughly 2.4 times US pay, yet US Paid Time Off is 3.1 times
Foreign. Even more alarmingly, US Paid Time Off is 2.3 times US pay!

We're fairly sure SCO have been planning their bankruptcy for some time. If
they were going to pull a fast one in bankruptcy, they would do it now, before
the new judge has got to know them. Have SCO pulled fast one here?

---
Monopolistic Ignominious Corporation Requiring Office $tandard Only For
Themselves

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: Ian Al on Wednesday, September 19 2007 @ 05:55 AM EDT
First of all, thanks to the G7 group for their attention and their excellent reporting.

Mr. Nashelsky stated Novell does not oppose Chapter 11, but wishes to preserve its rights on counterclaims... SCO began the litigation in Utah in 2004, and SUN and Microsoft gave money to SCO for UNIX licenses; under the August 10 decision, Novell owns the copyrights and the Sun and Microsoft funds were converted. The only things left to resolve in a 3 to 4 day bench trial was how much SCO owed for wrongfully retaining Novell's money and whether SCO had the right to enter into those license agreements in the first place.

He then asked the judge to lift the stay on the trial to determine how much SCO owes. The judge then stated that Novell's request would give Novell priority as a creditor and if he granted it, then everybody coming in front of his bench would ask for the same.

Nashelsky replied that it is their money, it can be escrowed and SCO concedes it is Novell's money.

The judge ruled that Novell is not being prejudiced by the denial of a constructive trust and invited them to file a lift stay motion to proceed in Utah in front of Kimball. Nashelsky replied that he would file and will be seeing the judge again.

I've copied much more than I need, to give my views extra weight (I learnt that off of SCOG!). OK, first some thoughts about Judge Gross. He knows of Judge Kimball by name. Where did he get that from? It's not in Darl's first day paper. He was not shocked, shocked by the word 'conversion' or by the information that SCOG had been found guilty of it and of failing their fiduciary responsibilities. I think he has researched the cases. Not bad for two day's work.

He ruled that Novell is not being prejudiced by the denial of a constructive trust. Novell did not ask Judge Gross for one so he must have been referring to Judge Kimball's refusal. Judge Gross holds the purse strings now so he will not allow Novell's money to be frittered away any more than is strictly necessary to complete the Chapter 11 proceedings (or not, as the case might find). Novell are therefore not predudiced.

He invited them to put it in writing. Why might that be? I would have thought that he needed the citations in writing in order to give a ruling that SCOG had been found in law to have converted Novell's money and that he had the basis for unstaying the trial. Lawyers argue, judges order. He could have dug up the citations himself. Why bother when there is a motivated lawyer to do the job?

What did he mean by 'everybody coming in front of his bench would ask for the same'? He could have meant that any creditor could argue for priority treatment. He might also have meant that IBM and RedHat seemed to have a clear run at becoming major creditors if their cases were unstayed. Well, that's the whole point of Chapter 11, isn't it? You have to keep ongoing litigation at bay to give the protected breathing space for reorganisation into a viable company. If the judge thought that IBM and RedHat would gut the newly reorganised SCOG the moment it left the hideout of Chapter 11, he might decide that to progress would be impossible without unstaying those cases as well. I suspect he wants to see similar written motions from them giving the extent of the damages they would argue. If he thought they had a chance and that the sums made Chapter 11 pointless, he might punt on unstaying those two cases and adding them to the list of creditors/liabilities. By then he would also have the legal basis for their position in the priority of creditors.

What about Novell? They wanted SCOG to have their Chapter 11 bankruptcy proceedings. Why? They had made up their minds before appearing in the courtroom. Perhaps they had come to the same conclusion as Judge Gross. In Chapter 11, SCOG could not maintain the same burn rate of Novell's cash. With no bankruptcy at all, SCOG would stoke up the burn rate. In Chapter 7, only the existing creditors might get prioritised and Novell might only get the stream of money already put in the restricted accounts by SCOG. However, SCOG have lost all the accountants who understood that some revenue had to go into restricted accounts. The temps might make a 'genuine' mistake and put the money into the wrong income stream!

I also build cattle ranches from timber yard offcuts.

---
Regards
Ian Al

Linux: Genuine Advantage

[ Reply to This | # ]

SCO misstated revenues!?
Authored by: dcf on Wednesday, September 19 2007 @ 08:59 AM EDT

The Notice of Late Filing said

Revenue for the three and nine months ended July 31, 2007 decreased by approximately 37% and 24%, respectively, from the three and nine months ended July 31, 2006.

(see SCO's Bankruptcy Hearing Tomorrow Changed to 8:30 AM - Updated)

Similarly, the first reports from the bankruptcy hearing are that

Mr. Spector spoke for SCO first. He gave some background on SCO. Last 3 months $7.4 million last year; $4.7 million this year. Last nine months $21.9 million last year; $16.7 million this year.

This is consistent with the percentage declines from the Notice above. However, SCO's earnings press release from fiscal Q2 2007 (ending April 30, 2007) says that total revenue was $6 million (with $4.9 million of Product revenue). The $7.4 million figure, on the other hand, does roughly match the total revenue of $7.1 million reported for and fiscal Q2 2006.

I'm guessing that the remaining accounting employees aren't getting much sleep - otherwise it seems like a fairly obvious error.

[ Reply to This | # ]

Sympathy for the Darl?
Authored by: z80kid on Wednesday, September 19 2007 @ 09:35 AM EDT
"As a human being, he seemed to be a nice guy."

First off, let me say that I appreciate the high standard of professionalism maintained by Groklaw'ers attending these events.

I understand the urge to empathize and the desire to see the best in people. But this man is no innocent victim, he (and his cohorts) have attempted fraud and extortion on a massive scale and slandered many good names in the process.

Sylvester made an excellent point about him believing his own lies. "Businessmen" like him do. To be $ucce$$ful, they have to make others believe the corporate position. In order to do this, they have to appear to believe it themselves - often to the point of being able to adopt an alternate reality and live in it as if it is the truth.

Remember all of Darl's public statements before the court case began? They sounded ridiculous to us, but to others with no background knowledge he was able to convey that he passionately believed what he was saying. And we incredulously asked "Why can't they see that he is lying?". Well now maybe you understand a little better....

People like us want to believe people who are sincere and empathize with them. And people like us get taken by people like Darl every day. Gee, "he seemed like a nice guy".

Once you identify someone like this you must remember what they are, because you will never be able to use your natural human instinct and empathy to deal with them. I've met enough of his kind, and I don't feel sorry for him at all. Whether he is running companies into the ground or selling used cars, he will always be $ucce$$ful on the backs of people who believe him.

[ Reply to This | # ]

SCO is planning to re-argue it's already-lost case in the Bankruptcy Court
Authored by: Anonymous on Wednesday, September 19 2007 @ 11:18 AM EDT
As one on-site Groklaw reporter observed:

"Mr. Spector spoke again for SCO:
Items Novell is discussing took place in 2003."

This caught my attention, and undoubtedly angered the Novell team.

What's implied in that statement? SCO is going to argue that -- "whatever
supposed "conversion" took place, it took place a LONG time ago, and
Novell is only bringing it up now? Now, when we're on the brink of Bankruptcy?
It's a bad faith move by Novell, your honor, to manufacture priority status, and
oh by the way, Novell is likely estopped from trying to argue that we owe them
any more than a de minimus amount of money, because look how much time elapsed
from 2003 while Novell sat on their rights and implicitly condoned our right to
enter into these licenses?"

So -- SCO is indicating that they are going to try to make an estoppel argument
against Novell's rights, when Judge Kimball has already ruled, and SCO didn't
MAKE that argument against Novell when it had the chance (in the summary
judgment briefs).

From Judge Kimball's perspective, that argument is dead and waived. SCO is going
to try to raise it, from the dead, in the Bankruptcy court.

One thought -- is this an attempt by SCO to bootstrap up some leverage so that
they have SOMETHING to bargain with, in settlement negotiations with Novell?
Looks like SCO will throw it at the wall and see if it sticks.....

LEXLAW

[ Reply to This | # ]

It is personal
Authored by: darthaggie on Wednesday, September 19 2007 @ 12:45 PM EDT
It's about the company to us, or I should say the policy of the company, not the individuals.
Maybe for you, PJ. But maybe you don't remember when he slandered the Linux community during the MyDoom virus/DOS thingie as being the source of MyDoom. When someone accuses me of nefarious behaviour that I haven't engaged in and slanders my good name, it most assuredly is personal.

So, if Darl isn't sleeping as well as he used to, or is sweating more, or has more grey hairs or worry lines, or is suffering from on-going anxiety, I'm not particularly disposed towards feeling sorry for him. I'm more of a what goes around really goes around kinda guy.

[ Reply to This | # ]

  • It is personal - Authored by: Anonymous on Wednesday, September 19 2007 @ 06:10 PM EDT
    • I agree - Authored by: ETian on Wednesday, September 19 2007 @ 10:45 PM EDT
First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: Anonymous on Wednesday, September 19 2007 @ 06:47 PM EDT
"And they [Linux] fought back hard. With a very large PR budget"

Documentation please!

All Right, how many Linux commercials did you see during the superbowl? How
much is Ibiblio spending to promote Linux? How much is IBM spending to
advertise Linux? How much has PJ been paid to promote Linux?

The biggest PR campaigns that has been launched are SCO's SCO Source Licensing
program and Microsofts Patent FUD.

It's hard enough to find money to pay programmers to contribute to Linux, let
alone launch a PR campaign.

Linux is one of the most poorly marketed products I've ever seen, except for the
free trail offers passed around by word of mouth and donated CDs. (Try it,
you'll like it, and no we won't expire your trial or hobble it.)

[ Reply to This | # ]

Novell's share - First Word From the Bankruptcy Court Hearing - Update ...
Authored by: Anonymous on Wednesday, September 19 2007 @ 06:54 PM EDT
Ok,

So Novell gets the stay waived. The trial before Judge Kimball goes forward,
and it is established SCO owes Novell thirty million.

The bankruptcy court decides it is a debt as the same order as the other
debts. The ten million is portioned out accordingly, and Novell gets six or
seven million. SCO then has no revenues to continue in business.

SCO is then in no position to act as an agent for Novell.

Novell then starts collecting royalties directly.

Anybody want to buy a mobile Unix business cheap?

[ Reply to This | # ]

First Word From the Bankruptcy Court Hearing - Update 2Xs - Meeting Darl, New Filings
Authored by: Anonymous on Wednesday, September 19 2007 @ 11:53 PM EDT
Thanks for being our eyes and ears. Thanks for lesson in civility and humility.

[ Reply to This | # ]

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