|
|
| More on the Bankruptcy Hearing - Who Exactly Is The Proposed Buyer? - Updated |
 |
|
Thursday, June 18 2009 @ 06:34 AM EDT
|
There are some media reports on the SCO cliff hanger bankruptcy hearing on Monday. The more information that comes in, the less clear I am on exactly who the actual proposed buyer is. I'll show you why.
In ars technica's SCO signs deal to avoid liquidation right before hearing, they mention Gulf Capital Partners:
The dying SCO Group narrowly evaded conversion to Chapter 7 bankruptcy this week by signing a last-minute deal to sell its UNIX assets to Gulf Capital Partners. The sale has earned SCO another delay in the bankruptcy proceedings and could potentially enable the company to continue pursuing its controversial litigation campaign.
SCO has not yet issued a public statement about the sale, and the specific details have not yet been disclosed. It appears as though SCO made the agreement at the very last minute in a desperate attempt to stave off liquidation so that it can continue with the process of appealing the 2007 ruling. SCO still hasn't presented any evidence to substantiate its claims and it seems extremely unlikely that the delay will help the company. I'm not sure this is the correct name, though. A pro se filing [PDF] the day of the hearing by Al Petrofsky challenges that name and states that it's actually Gulf Capital Advisory LLC, registered in Delaware:
2. The movant does not appear to be a legally formed entity in the state of Delaware nor any other jurisdiction.
3. This is particularly concerning because it is the second time in this case that papers have been filed alleging the existence of a non-existent LLC apparently associated with Stephen L. Norris. See the "Memorandum of Understanding" (Exhibit A to Docket No. 346, filed February 14, 2008), signed by Stephen L. Norris as alleged chairman of the non-existent "Stephen L. Norris Capital Partners, LLC, a Delaware limited liability company" and alleging that that that entity already "ha[d] a financing commitment sufficient to provide the Equity Financing and the Debt Financing [$35 million]" (Id. at p. 3).
4. Earlier today, when I first spoke to the purported movant's local counsel, Kelly Conlon, she refused to identify her alleged client's state of legal formation, flatly refused even to confirm or deny that the alleged client legally existed in any jurisdiction, and stated that no further information would be provided to me and that any concerns I had should be addressed to the Court.
5. Ms. Conlon has since informed me that there was "a typo" in the motions and that she represents Gulf Capital Advisory, LLC, a Delaware LLC.
This filing was ignored, so far, at least from the hearing notes we received from our eyewitnesses, and the upshot will probably just be corrections, but those who have a copy of the agreement might want to look to see how it was signed. According to our update 5, Stephen Norris signed the agreement, but now the question is, for which entity? And when was the entity formed? Recently? Is that the sound of wings I hear? It makes one wonder who exactly is the final buyer, particularly because the Berger Singerman lawyer who worked out the deal, Mr. Kaplan, reportedly testified at the hearing that he wasn't clear what Mr. Norris' role was. According to update 5, he testified like this: The principal businessman is in London. The principal is in London. I am not certain of Norris' role. I have not been aware of Mr. Norris. So, the only possible response to that is, what's up with that? He is referring to Eric LeBlan, presumably, or at least according to our eyewitnesses' reports, as the UK businessman. But you might want to mentally put a marker here, to make sure to watch this issue as more information arrives. At some point SCO will have to file with the SEC presumably. And as you know, Darl McBride testified under oath in a prior court hearing that he always tells the SEC the truth.
Maureen O'Gara nevertheless writes [http://linux.sys-con.com/node/1005328]: Stephen Norris, one of the original founders of the chi-chi Carlyle Group, and his current equity arm Gulf Capital Partners LLC – the money is reportedly coming from Saudi Arabia unless the White House stops it – are offering $2.4 million for what remains of SCO’s Unix business plus its mobility technology....
If SCO winds up with the Unix copyrights after all it only gets to run with them for 10 years then they revert to Gulf Capital Partners. If she is correct in any respect, then it sounds like this is just the old deal reheated.
Finally, in SCO Does It, Quite Frankly, As Usual, by Justin Ryan, Linux Journal, the article mentions a basis for an appeal:
On the subject of appeals, were we among the creditors, we would appeal the court's ruling on admitting the sale agreement into evidence to the District Court, contending that the bankruptcy judge erred in ignoring Fed. R. Bankr. P. 9014(e) and Local Rule 9006-1(c)(i), and to a lesser extent, Local Rule 9013-3.
The article mentions the movants agreeing to the delay, based probably on our first, earliest eyewitness reports, but if you read updates 4 and 5 to our eyewitness reports article, I think it's clear now that they did not. It was a judge's ruling, and then after that they agreed on the dates for a hearing, once he reached his decision that there had to be a hearing. That's the advantage of having many eyewitness at a hearing, actually. They each notice different things. The reason it matters is that because no one agreed to the delay, they can appeal, if they so chose. I have no clue whether they will or not, but they can, as I understand it.
Update: Here's Fed. R. Bankr. P. 9014(e): The court shall provide procedures that enable parties to ascertain at a reasonable time before any scheduled hearing whether the hearing will be an evidentiary hearing at which witnesses may testify. And here's Delaware's Local Rule 9006-1(c)(i) [PDF]: Service of Motion Papers. Unless the Fed. R. Bankr. P. or these Local Rules state otherwise, all motion papers shall be filed and served in accordance with Local Rule 2002-1(b) at least fifteen (15) days (eighteen (18) days if service is by mail; sixteen (16) days if service is by overnight delivery) prior to the hearing date. Meaning as opposed to just showing up in court with your motion and giving IBM and Novell and the US Trustee no notice.
And
Delaware Bankruptcy Court Local Rule 9013-3, in that same Local Rules PDF, says:
Service Copies. Unless otherwise ordered by the Court, only one (1) copy of pleadings, motions and other papers need be served upon another party. Here, there was one copy to start with for IBM, Novell, and the US Trustee to share. Heh heh. And notice it says copy, not original. That rule presumes, of course, that there is actual service, days in advance of a hearing, so the party can make as many copies as it needs, not that there will be a court ambush.
|
|
|
|
| Authored by: Winter on Thursday, June 18 2009 @ 06:53 AM EDT |
Remember to stay Off Topic.
---
Some say the sun rises in the east, some say it rises in the west; the truth
lies probably somewhere in between.[ Reply to This | # ]
|
| |
| Authored by: Winter on Thursday, June 18 2009 @ 06:55 AM EDT |
Links are nice, really.
---
Some say the sun rises in the east, some say it rises in the west; the truth
lies probably somewhere in between.[ Reply to This | # ]
|
- Upcomming Newspick Comment: Desperate MS offers a ten grand price if you convert to IE8 - Authored by: Winter on Thursday, June 18 2009 @ 07:16 AM EDT
- If this is not the best sign of a lost monopoly? - Authored by: Winter on Thursday, June 18 2009 @ 07:24 AM EDT
- Nice analyses! n/t - Authored by: Gringo on Thursday, June 18 2009 @ 08:13 AM EDT
- Ten grand prize - Authored by: luvr on Thursday, June 18 2009 @ 08:22 AM EDT
- old Firefox, boring Safari - Authored by: nola on Thursday, June 18 2009 @ 08:35 AM EDT
- Poof: Page gone - Authored by: Winter on Thursday, June 18 2009 @ 09:11 AM EDT
- Upcomming Newspick Comment: Desperate MS offers a ten grand price if you convert to IE8 - Authored by: Anonymous on Thursday, June 18 2009 @ 09:15 AM EDT
- Most likely the money is found in some SILVERLIGHT proprietary video? - Authored by: Anonymous on Thursday, June 18 2009 @ 09:17 AM EDT
- This *explicitly* promotes their vision of an incompatible Internet - a hilarious "tell" - Authored by: qu1j0t3 on Thursday, June 18 2009 @ 10:01 AM EDT
- In other words - Authored by: Anonymous on Monday, June 22 2009 @ 07:25 PM EDT
- How to tell Ubuntu you don't want MONO... they have a plan to fix Ubuntu (start by drop of MONO) - Authored by: Anonymous on Thursday, June 18 2009 @ 09:22 AM EDT
- Black Duck: GPLv3 Gaining, Passes Apache License in Popularity - Authored by: tiger99 on Thursday, June 18 2009 @ 11:23 AM EDT
- HealthSouth’s Scrushy Liable in $2.876 Billion Fraud - Authored by: Anonymous on Thursday, June 18 2009 @ 02:35 PM EDT
| |
| Authored by: darksepulcher on Thursday, June 18 2009 @ 07:14 AM EDT |
Please report any typos or errors in the above article in this thread. Thanks.
---
Had I but time--As this fell Sergeant, Death
Is strict in his arrest--O, I could tell you--
But let it be.
(Hamlet, Act V Scene 2)
[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 07:27 AM EDT |
First, we heard that the judge chose to ignore the statute about the 15 days.
Of course he knows he can get away with this, because an appeal against his
decision would take more than 15 days, and cost money, which nobody really wants
to spend. But you have to ask yourself: if a judge chooses not to respect the
law, why would anyone else?
Then, apparently the court "ignored" Mr
Petrofsky's motion. Now, I gather there is some history of animosity between
some Groklaw participants and Mr Petrofsky. And he's acting pro se, which
usually is not a good idea. But the court ignores the motion? Can it do
this, without giving any reason? Maybe that should be two questions: (1) does
the law grant the judge discretion to ignore motions without giving reasons, and
(2) if it doesn't, and the judge chooses to flout the law, can he get away with
it?
[ Reply to This | # ]
|
| |
| Authored by: RFD on Thursday, June 18 2009 @ 07:48 AM EDT |
Al Petrofsky's objections were not mentioned at the hearing. In a very brief
exchange, Mr. Spector brought up the pro hoc vice motions, asked that the
attorneys be permitted to appear at the hearing, and Judge Gross quickly agreed.
They actually took no part in the hearing, however.
---
Eschew obfuscation assiduously.[ Reply to This | # ]
|
| |
| Authored by: NigelWhitley on Thursday, June 18 2009 @ 07:50 AM EDT |
The snippet PJ provides of MOGgy's latest insight into SCO's world includes
"If SCO winds up with the Unix copyrights after all it only gets to run
with them for 10 years then they revert to Gulf Capital Partners."
PJ has previously commented on SCO's need to tread a fine line to have Novell
agreements mean only what SCO wants them to mean. Here we may get another
opportunity to see SCO skittering along the high wire, as PJ has also mentioned.
SCO must simultaneously plead to the Utah courts that the APA could not have
been what the parties intended because you can't run the business without the
copyrights, while asking the BK court to approve a plan in which they sell the
business without the copyrights.
I'm not convinced that Mr Norris et al can produce a strong enough safety net
for the coming fall.
----------------------
Nigel Whitley[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 08:03 AM EDT |
PJ said:
<blockquote>According to our update 5, Stephen Norris signed the
agreement, but now the question is, for which entity? </blockquote>
update 5 said this:
<blockquote>Trustee: It is signed by Steven Norris of
SNCP</blockquote>
Does this imply that Steven Norris signed it for SNCP?[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 08:05 AM EDT |
"The more information that comes in, the less clear I am on exactly who the
actual proposed buyer is."
The stated facts are inversely proportional to the set date.[ Reply to This | # ]
|
- SCOG 101. - Authored by: Anonymous on Thursday, June 18 2009 @ 08:33 AM EDT
- my suspicion - Authored by: nsomos on Thursday, June 18 2009 @ 10:59 AM EDT
- We can be sure... - Authored by: Anonymous on Monday, June 22 2009 @ 07:31 PM EDT
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 08:23 AM EDT |
If SCO sells their UNIX business, why would they still have standing to sue
anyone regarding that business? Wouldn't that standing go with the sale?[ Reply to This | # ]
|
| |
| Authored by: Steve Martin on Thursday, June 18 2009 @ 08:52 AM EDT |
I got curious and did a bit of research on the supposed bases for appeal
cited in the Justin Ryan article.
Fed. R. Bankr.
P. 9014(e) says
The court shall provide procedures that enable
parties to ascertain at a reasonable time before any scheduled hearing whether
the hearing will be an evidentiary hearing at which witnesses may
testify.
This would seem to preclude simply jamming witnesses into
a hearing that was supposed to be on a completely unrelated motion. And it
certainly seems relevant to what turned out basically to be an evidentiary
hearing, rather than a hearing on a conversion motion.
Delaware
Bankruptcy Court Local Rule 9006-1(c)(i) says
Service of
Motion Papers. Unless the Fed. R. Bankr. P.
or these Local Rules state
otherwise, all motion papers
shall be filed and served in accordance with Local
Rule
2002-1(b) at least fifteen (15) days (eighteen (18) days
if service is by
mail; sixteen (16) days if service is
by overnight delivery) prior to the
hearing date.
I'm not sure this is relevant, since the papers on
the Motion that was scheduled to have been heard were timely filed, and
the matter that actually was heard was technically not heard in reponse to any
Motion.
Delaware Bankruptcy Court Local Rule 9013-3
says
Service Copies. Unless otherwise ordered by the
Court,
only one (1) copy of pleadings, motions and other papers need be served upon
another party.
I can't figure out why the original author might
think this would be relevant to a possible appeal to the District
Court.
Of the three, I think the first probably has more legs than do the
latter two. But as I've said before, IANAL, so what the heck do I
know? ---
"When I say something, I put my name next to it." -- Isaac
Jaffe, "Sports Night" [ Reply to This | # ]
|
| |
| Authored by: SirHumphrey on Thursday, June 18 2009 @ 09:04 AM EDT |
Will this be what we'll sing when this deal falls through too?
[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 09:54 AM EDT |
Can the District Court, in an appeal, impose Chapter 7, reversing the Bankruptcy
Court? Has that ever happened in the history of this bankruptcy code?
[ Reply to This | # ]
|
| |
| Authored by: Lazarus on Thursday, June 18 2009 @ 12:45 PM EDT |
Ok, MOG has, previously, shown "insight" (more likely insider info
she's been fed) on what SCO is thinking.
The fact that she referenced "unless the White House stops it" gives
my wildhair theory of a few days ago more credence (sp?).
Either SCO will use a WH denial of the sale to beg for money from the Feds, or
spin it as an "exceptional circumstance" to get yet another delay.
Most likely both.[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 01:46 PM EDT |
ITARS and EARS are the laws / regulations in place that
deal with critical / secure / weaponizable info being
placed into the hands of foreign nationals.
Many documents are for US and Canadian eyes only, even
our UK allies (and other NATO friends) can see 'em.
This should NOT be a surprise to any business that is
looking to do a technology transfer to some other nation.
It is WIDELY know by business that these laws / rules
exist and to claim "we didn't know" or "we deserve an
extension" or "we want a payout" will not fly.
In this case, SELLER ~and~ BUYER BEWARE.
In that I work for an Aerospace Company, including working
on MIL projects, these rules are part and parcel and do
carry strict fines / repurcussions (sp?) for their
violations.
The real question is: Assuming there is something to
sell (Novell, contracts, etc. notwithstanding), and
assuming that none of it is owned and then blocked
by IBM, is anything in the UNIX code considered
non-publicly available anymore? Is it even covered
by an ITARS or EARS rule? That was probably
something that needed to be decided ~before~ the deal
was brokered.
So if this "fails" because of ITARS / EARS, then this
deal should have been a no-go from the start, not allowed
by the court and immediate conversion to Chapter 7 should
commence.
Finally, this won't be blocked by the White House. These
are government regulations and are subject to US law / etc.
This has nothing to do with the current administration.
jcjodoin
(not logged in)[ Reply to This | # ]
|
| |
| Authored by: nola on Thursday, June 18 2009 @ 02:17 PM EDT |
I suspect that the "investor" had better arrive at he next hearing with pan in
hand and a certified check (cheque), and that closing the deal will be done at
the bench.
If not, I suspect that lawyers will be held in contempt. And
probably in jail
(gaol). The judge is willing to give leeway but I sense that
the limit has now been
reached.
[ Reply to This | # ]
|
- closing event - Authored by: Anonymous on Thursday, June 18 2009 @ 02:50 PM EDT
- closing event - Authored by: Anonymous on Thursday, June 18 2009 @ 03:04 PM EDT
- closing event - Authored by: Anonymous on Thursday, June 18 2009 @ 04:41 PM EDT
- Typo? - Authored by: Anonymous on Thursday, June 18 2009 @ 04:53 PM EDT
| |
| Authored by: jbb on Thursday, June 18 2009 @ 03:22 PM EDT |
| If tSCOg had not gone bankrupt, they might have been facing severe
financial
liabilities if all/some of the court cases went badly for them.
Is it
fair/legal for them to separate their assets from their (potential)
liabilities? If this is legal then any company facing a severe adverse
judgment could declare bankruptcy, split off their assets, and leave the
winner holding an empty shell.
I know this has been discussed before, but I
don't see recent mention of
it.
---
You just can't win with DRM. [ Reply to This | # ]
|
- Liability? - Authored by: stegu on Thursday, June 18 2009 @ 03:39 PM EDT
- Liability? - Authored by: ralevin on Thursday, June 18 2009 @ 05:07 PM EDT
- Liability? - Authored by: Anonymous on Friday, June 19 2009 @ 05:39 PM EDT
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 03:41 PM EDT |
http://blogs.computerworld.com/
sco_rises_from_the_dead#comment-146370[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 04:14 PM EDT |
"This filing was ignored, so far, at least from the hearing notes we
received from our eyewitnesses, and the upshot will probably just be
corrections, but those who have a copy of the agreement might want to look to
see how it was signed."
I never heard Al's (or anyone else for that matter) voice but someone was
appearing by telephone. Because of the other boring events :-) we never found
out who was on the phone.
[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 04:30 PM EDT |
Sorry, but to me, the parallels are eerie (Earie? Erie?). Rules disregarded,
rules made up on the fly. And the results, perhaps, just as legitimate.
[ Reply to This | # ]
|
| |
| Authored by: Anonymous on Thursday, June 18 2009 @ 05:06 PM EDT |
Eric le Blan is a banker, not a software industry person. His background as
stated on public sources shows no experience at all in the software industry. He
doesn't seem at all like the sort of person to lead a small and deeply troubled
software company out of its current problems.
However, his banking
background is interesting. His real speciality is making connections between
people with money and people with influence. He then makes a nice commission on
having brought the two together. He has worked extensively in the Middle East
where businessmen are expected to be discrete and "open minded" with regards to
how business affairs are conducted.
This sounds a lot like Baystar Mk
II. I suspect though that Mr. le Blan will be a lot more successful at keeping
his mouth shut about where the money is actually coming from.
A really
interesting point is the following that PJ quoted:
If SCO
winds up with the Unix copyrights after all it only gets to run with them for 10
years then they revert to Gulf Capital Partners.
What makes it
interesting is that it sounds like SCO is really just more or less
leasing their legal claims from the new buyer, not owning them. This
sounds as if there is an attempt to ensure that if the rump of SCO goes bankrupt
again (which seems likely), then the claims could be recycled to someone else,
while keeping the real "owner" insulated from any counter claims.
If
this is in fact the case, then if I was Novell, IBM, or Red Hat I would be
trying to reel in whoever is behind Mr. le Blan and make them stand beside SCO
in court to make sure the judgement sticks.
[ Reply to This | # ]
|
- Rope - Authored by: argee on Thursday, June 18 2009 @ 10:38 PM EDT
|
|
|
|
