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Judge Gross Wakes Up: Order Re July 27th Hearing
Tuesday, July 21 2009 @ 04:58 PM EDT

Judge Kevin Gross, the judge handling the SCO bankruptcy, appears to have awakened with a start.He says IBM has informed him of issues related to the July 27th hearing on SCO's proposed sale of assets to unXis. I'll say.

He has issued an order that there will be a teleconference on July 22 with him and the parties, in advance of the hearing on the 27th, and he wants the discovery IBM has asked for produced by SCO by the end of the day on the 22nd, the day of the teleconference. He orders the deposition of Ryan Tibbits and William Broderick on the 23rd or they will not be allowed to testify on the 27th. And most significantly, he says he will not consider any testimony or documents on the alleged strength of SCO's litigation against IBM, Novell, Red Hat or AutoZone. Period. It's not his ball of wax.

The cluetrain seems to have arrived at the station. I surely hope, though, that some of you can attend that hearing, so we'll know in a timely way what happens. It will be like a mini-trial. With the new court rules holding back transcripts until weeks later, it's our only source of immediate information.

Here's the order:

07/21/2009 - 856 - Order Re: Hearing To Be Held On July 27, 2009. Order Signed on 7/21/2009. (BMT) (Entered: 07/21/2009)

Update:Groklaw member jbb highlights an important point:
Both the Novell and IBM objections hammered at the issue of "good faith" even though Novell did not force feed it to the judge. IMO IBM hit the crux of the issue with:
. .. disclosure is a fundamental requirement of good faith. A sale is not in good faith where "the relationship between the seller and the buyer has been concealed"...

Belated disclosure after the truth has been uncovered should not suffice to cure earlier non-disclosure. A debtor's response of disclosing only after being caught cannot constitute good faith.

I think, myself, that these two paragraphs in Novell's filing must have caught the judge's attention also, because it is, not matter how nicely put, a criticism of what happened at the last hearing:
8. Over the objections of IBM and Novell, the Court agreed to consider the PSA in connection with the Conversion Motions. The Court reached this result based upon its findingthat the Debtors were proceeding in good faith, a conclusion it reached in reliance on the Debtors' representations and some testimony from the Debtors. Given the lateness of the hour and the moving parties' clear disadvantage in trying to deal with the PSA on essentially no notice at all, the Court and parties adjourned the Conversion Motions to be heard with a motion by the Debtors for approval of the PSA on a schedule the parties were to agree upon. The parties thereafter agreed that the Debtors would file the sale motion by June 22, with oppositions due by July 20 after discovery, and a joint hearing on the sale motion and Conversion Motions on July 27.

9. In fact, the Debtors did not file the Third Sale Motion until late at night on June 22. (Dkt. 815.) Furthermore, they still did not attach the schedules or exhibits. Most of those came only on June 23rd even though the Debtors had represented to the Court on June 15 that the schedules and exhibits were ready, only awaiting completion of copying. (Dkt. 819.)3 Finally, a key exhibit, Exhibit A listing the executory contracts to be assumed and assigned (an exhibit that, like the others, supposedly was ready to go and final on June 15) was not filed until July 10, 18 days after the agreed-upon deadline and 25 days after the June 15 hearing, when the Debtors represented to this Court unequivocally that it was complete except for copying. (Dkt. Nos. 832, 833.) Even then, it took the Debtors yet another week and repeated inquiries by Novell before the Debtors could state positively whether the crucial Novell-Santa Cruz APA that is at the heart of the Litigation was to be assumed or not (it was not). (See Exhibit A hereto (email chain between counsel for the Debtors and Novell).)4 Since the Debtors had represented on June 15 that they had taken so long to make a deal because they had only just worked out the key issue of what assets they claimed under the APA that they would need to keep (see, e.g., 6/15 Tr. 4:4-41:5), it is puzzling why the Debtors had to were so unclear on that subject that they could not respond definitively to Novell's questions until July 17, more than a month later.

Here's the order as text:

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

IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE

In re:

The SCO GROUP, INC., et al.,

Debtors. 		)
)
)
)
)		 Chapter 11

Case No. 07-11337(KG)

ORDER RE HEARING TO BE HELD ON JULY 27 2009

International Business Machines Corporation by letter, dated July 21, 2009, from Richard Levin, Esquire (the "Letter"), has alerted the Court to issues concerning the Hearing on July 27, 2009. Given the few days remaining prior to the Hearing, the Court is issuing this Order in advance of the teleconference on July 22, 2009, at 9:00 a.m.

1. Discovery

a. Debtors shall produce by the close of business on July 22, 2009, all of the documents responsive to the categories the Letter identifies.

b. Debtors shall either make available for deposition on July 23, 2009 (afternoon) Ryan Tibbits and William Broderick, or will not be permitted to have them testify,

2. Hearing

a. The Court will not hear testimony or admit into evidence reports or affidavits/declarations addressing the merits of Debtors' claims against IBM, Novell, Red Hat and/or AutoZone. Any testimony or evidence on the strengths or weaknesses of the cases would inappropriately require the Court to make findings on the merits of the litigations without a full record.

(1)

b. The Court will allot 2,5 hours for each side (i.e. Debtors on one side, IBM and Novell on the other) and time for the Office of the United States Trustee, if needed, up to 30 minutes, Each side will have a total of 30 minutes to make an opening (if desired) and/or a closing argument and the Office of the United States Trustee will have 10 minutes. The Court urges the parties to consider and discuss the possibility of proffering direct testimony subject to cross examination of the witness.

c. The parties shall exchange Hearing exhibits as follows:

All parties: by noon on July 23, 2009

Objections: exchanged by 4:00 p.m. on July 24, 2009

3. The Court will conduct a teleconference on July 22, 2009, at 9:00 a.m.

SO ORDERED this 21stday of July, 2009

KEVIN GROSS, U.S.B.J. [Signature]

(2)

  


Judge Gross Wakes Up: Order Re July 27th Hearing | 588 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections Thread Here
Authored by: MDT on Tuesday, July 21 2009 @ 05:01 PM EDT
Please identify where (I know, short one for now, could get updated though).

---
MDT

[ Reply to This | # ]

Off Topic Thread Here
Authored by: MDT on Tuesday, July 21 2009 @ 05:04 PM EDT
Please use clickies if you got them.

It's easy, honestly :

<a href="YOUR HTTP LINK HERE">TEXT YOU WANT TO CLICK
HERE</a>

---
MDT

[ Reply to This | # ]

Judge Gross Wakes Up: Order Re July 27th Hearing
Authored by: jjock on Tuesday, July 21 2009 @ 05:06 PM EDT
All I can say, is that I have waited since 2003 in the hope that
the courts would finally see what depths SCO would sink to in an
attempt to hijack Linux. I hope they have gone far enough so
that charges can be laid against Darl and his crew.
I am so grateful that we have a glimmer of hope. However, I will
continue to hold my breath until the 27th.
Bob

[ Reply to This | # ]

News Pick Thread Here
Authored by: MDT on Tuesday, July 21 2009 @ 05:06 PM EDT
Again, use clicky links if you got them.

Not hard.

<a href="YOUR HTTP LINK HERE">TEXT YOU WANT TO CLICK
HERE</a>

---
MDT

[ Reply to This | # ]

Lesson 1: Never tick off a judge
Authored by: MDT on Tuesday, July 21 2009 @ 05:11 PM EDT
I'm pretty sure that's the first thing they teach in legal classes, never tick
off the judge. I think SCO has finally gotten to the point of ticking off the
judge. They did that in NOVELL, in IBM, and I think in AutoZone as well.

Now they've done it in their bankruptcy. No judge wants to be played for a
sucker, and when a bankruptcy litigant out and out lies to the court and
conceals monetary payments, the judge in the case is going to feel like he was
being used. And he's going to smack back, HARD.

I would love to be able to hear the July 22nd phone conference. The judge
sounds ticked just from his orders (see link in article). I'm guessing the
lawyers involved are all trying to figure out how to shift as much blame as
possible to SCO officers. "Honestly your honor, we had no idea Mr. McBride
had paid under the table, we would never have said what we said if we'd
known."



---
MDT

[ Reply to This | # ]

The Letter
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:11 PM EDT
Sure wish we could read that letter!

[ Reply to This | # ]

Timing
Authored by: PolR on Tuesday, July 21 2009 @ 05:17 PM EDT
The letter was received today.

The order was issued late this afternoon.

The teleconference is tomorrow 9:00 AM

This isn't the snail pace courts have used us to.

SCO is in deep doodoo.

[ Reply to This | # ]

OMG! OMG!
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:18 PM EDT
and he wants the discovery IBM has asked for produced by SCO prior to that teleconference.
SCO: Your Honor, that's less than 24 hours. We can't possibly have it... No... Our copy machine just broke... No... We were just informed by our security guards there was a break-in last night and all the documents IBM requested have been stolen...

[ Reply to This | # ]

Judge Gross Wakes Up: Order Re July 27th Hearing
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:24 PM EDT
Only thing missing was an order for Daryl to surrender his passport.

[ Reply to This | # ]

Hearing problems
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:27 PM EDT
Will the hearing be on
A) The sale
B) The conversion
C) Both
D) The lack of availability of really good Chinese food in Federal Correctional
Facilities
E) All of the above
F) None of the above

[ Reply to This | # ]

The refreshing splash of cold water...
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:27 PM EDT

...after you've been spending time in the desert on a hot day!

RAS

[ Reply to This | # ]

If I had a vacation day, this would almost be worth the plane fare to Delaware (n/m)
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:41 PM EDT
MSS2

[ Reply to This | # ]

How are such orders served?
Authored by: UncleJosh on Tuesday, July 21 2009 @ 05:52 PM EDT
Does the BKJ's office just call the affected law firms' offices and give them
the conference call information? Clearly the various law firms/lawyers use
e-mail, does the BK court?

[ Reply to This | # ]

Not be allowed to testify?
Authored by: Anonymous on Tuesday, July 21 2009 @ 05:59 PM EDT
Why would I want to testify?! I don't want to be deposed, either! I need to be
in Bolivia! er, I mean, Botswana! In twenty minutes!

(Just thinking that "not be allowed" might not carry quite the threat
it would have before certain... uh, irregularities? were disclosed by IBM)

cpeterson, WINAL

[ Reply to This | # ]

groklaw.com - under construction page
Authored by: Anonymous on Tuesday, July 21 2009 @ 06:01 PM EDT
I get a "under construction" page when trying to go to groklaw.com,
.net seems to be fine.

w00t

[ Reply to This | # ]

Richard Levin
Authored by: MacUser on Tuesday, July 21 2009 @ 06:03 PM EDT
The latest development seems to be on foot of a letter from Richard Levin (Cravath, Swaine & Moore). Apologies if this has been posted in other threads, but there's an interesting bio on Mr Levin on the Nazgul site (you can even download a fetching PDF of Mr Levin's resumé -- he smiles, mouth only): http://www.cravath.com/bios/rlevi n.aspx

[ Reply to This | # ]

High Noon in Delaware - the 27th!
Authored by: Anonymous on Tuesday, July 21 2009 @ 06:05 PM EDT
Reading this thing is like the judge drawing lines for a
duel in the streets at high noon.

I think the filing from IBM really dropped a big stinky fish
on his desk. Made all the worse after he kind of put
himself out there by bending the rules a little bit to give
SCO more time. If I were him, id be feeling burned a little
bit. SCO might find this hearing a bit less accommodating
than those which have come before.

Is there any parallel here that we are collectively aware of
from other cases to look at in Delaware or elsewhere?

Thinking:

1) Id like to see if another BK case has dealt with this
kind of insider cash transaction to bring forward a bidder.

2) Precedent for a sort of trial like this and the
circumstances that brought it about in a BK case.

3) I am also really curious about speculation on the legal
tactics that SCO has left to them at this point. The judge
has explicitly said don't waste my 2.5 hours of your time
with anything related to the lawsuits. So does that leave
more speaking to the propriety and defense of this bid
alone? What other special circumstances might SCO cite to
avoid chapter 7?

4) If the appeals decision magically comes through July 24,
and lets assume the worst possible, it remands the whole
thing to utah for jury trial, does that realistically change
anything in light of the judge saying i dont want to hear
about the court cases?

---
Clocks
"Ita erat quando hic adveni."

[ Reply to This | # ]

A bit hasty, no?
Authored by: mpg on Tuesday, July 21 2009 @ 06:14 PM EDT
Under "normal" circumstances, I assume things wouldn't suddenly happen
nearly so fast. Wouldn't this sort of thing typically cause a delay of the
hearing on the 27th, so that all parties could have a few weeks to play this new
act out a bit?

So why the haste? One might like to believe the good Judge is full of righteous
indignation and wants to bring the hammer down hard on SCO tomorrow, of course,
but that seems like wishful thinking.

Indeed, mightn't this haste get us into troubles later on?

I truly hesitate to use the word, but can the Judge's order "fair" to
SCO? Won't this give SCO a chance to be able to claim they weren't given enough
time to prepare, etc, etc?

-mpg

[ Reply to This | # ]

IBM and Novell together?
Authored by: mpg on Tuesday, July 21 2009 @ 06:20 PM EDT
Likely a naive question, but I don't know how the law works at this level --

Novell and IBM both filed objections, in some degree covering different areas of
concern about the sale.

To what degree are the legal teams from IBM and Novell allowed to cooperate?
Would they be allowed to compare notes and share drafts of their respective
objections prior to submitting them to the court? Or are there any restrictions
on that sort of thing for some reason?

-mpg

[ Reply to This | # ]

Has SCO got some 'splainin to do?
Authored by: billyskank on Tuesday, July 21 2009 @ 06:42 PM EDT
Please say yes. :)

---
It's not the software that's free; it's you.

[ Reply to This | # ]

Another sale offer, what would happen ?
Authored by: Anonymous on Tuesday, July 21 2009 @ 07:16 PM EDT
"Your honor, we have here another sale offer, this time from a bona-fide
company which has just come to the table, we need another couple of months or so
to hammer out the details."

Would it work ? I am worried that the courts have to presume that every offer is
genuine, and while there is a chance of saving the company they have to allow
benefit of the doubt.

What if SCO really did have a genuine buyer this time ?

Could they keep gaming the system over and over again with new companies ?

[ Reply to This | # ]

Goss may save his own butt first?
Authored by: Anonymous on Tuesday, July 21 2009 @ 07:19 PM EDT

Given the short history of the bankruptcy case, I think Goss will be trying hard to save his own reputation as well as move the case along.

Self-interest seems to be a common thread in the SCO saga and that's extended to most if not all of the legal eagles flying around in this extended circus tent.

query: would the US Trustee refer the case to a state or federal attorney for fraud or breaches of the act or ibiblioles? or would relevant agencies take the initiative? or would nothing happen until their is significant public indignation?

Charles from OZ

[ Reply to This | # ]

"Good morning, Judge Gross. This is your wake-up call."
Authored by: TheBlueSkyRanger on Tuesday, July 21 2009 @ 07:20 PM EDT
Hey, everybody!

Am I the only one that would pay serious money to be a fly on the wall when the
conference is going on?

Here's a little piece of advice from a veteran prankster who has done some
really rotten things to some really deserving people -- choose you methods
carefully. If you provoke your mark, they WILL retaliate, and often, not in a
way you would prefer to deal with.

I'm putting up the chairs, I expect the lights will be out real soon.

Dobre utka,
The Blue Sky Ranger

[ Reply to This | # ]

Just Wow!
Authored by: relic on Tuesday, July 21 2009 @ 07:34 PM EDT
Way back when the Novell ruling happened, I knew this baby was over. I figured
SCO, being what they are, would have a few more shenanigans, but that was the
end of the road for them. Anything after that would be a corporate version of a
Monty Python death scene.

It's been entertaining to watch all the clever ways they could drag things out.
But this was just jaw-dropping, mind-numbing, eye-popping stupidity.

Fronting a pathetically transparent scam like this at the last possible second
is embarrassingly desperate. Relying solely on hope as a strategy is even
worse. Showing up a judge in the process is suicidal.

Never, ever, ever anger a judge. Never. They will teach you very quickly how
badly you can underestimate "the worst case scenario."

IANAL, but I've been a litigant in civil and BK courts. I work in an industry
where companies get in out of control debt with lightning speed and depressing
regularity.

I have heard a civil court judge say, "We're going to have a 30 minute
recess now and if either party returns afterwards, I will make a ruling neither
party will like."

If a judge believes all parties are acting in good faith, and most give a very
generous and loose definition of such, they will let things work out normally.
It can be infuriating to watch if you like immediate gratification in terms of
anything less than geological time.

If they think you're messing with them, they will drop you in your tracks.

This is an example of what it is like when the judge has had enough.

I would not be surprised at all if the hearing on the 27th does not happen. Any
hearing at all from today on won't be anything SCO will like.


[ Reply to This | # ]

Flight of the Nazgul
Authored by: mexaly on Tuesday, July 21 2009 @ 07:46 PM EDT
My personal guess is that IBM saw something in the proffered sale at the last
hearing, that they new was false. Hence the sudden depositions of all non-SCO
parties.

Add to that the unprofessional presentation of the documents by SCO attorneys at
the hearing.

We also share guesses that the large volume of documents "being copied
now" may not exist yet. This latter speculation meshes nicely with the
demand by the Honorable Judge to deliver documents in less than a day. Sounds
to me like he's calling a bluff on these virtual documents.

Add some lies in the documents, to some lies about the documents, to some lies
of omission about payments by or on behalf of SCO, to some wheeling and dealing
that should be supervised by the court but wasn't, to some attempts to pay sums
that weren't due to a stalking horse that didn't buy.

Then the Nazgul sidle up to the Honorable Judge and whisper in his ear about
things that have been going on in his kingdom. Blammo!

One wonders how the attorneys for SCO will fare as they are hoisted on their
petards. What amount of hide will be extracted from their haunches? Perhaps
Chapter Seven will be the anticlimax to the hearing?

And the phone call. Pray, what does the Honorable Judge want to set up for the
hearing? Testimony under threat of perjury by fast talkers, perhaps? Promises
by attorneys to produce their clients in-the-flesh? Will subpoenas or even
warrants from the bench be winging their way towards corporate officers? Will
legal partners be showing up to backpedal on behalf of embarrased associates,
crying "we didn't know, our client lied to us, too?"

Six days and counting.....

---
IANAL, but I watch actors play lawyers on high-definition television.
My thanks go out to PJ and the legal experts that make Groklaw great.

[ Reply to This | # ]

Judge Gross Wakes Up: Order Re July 27th Hearing
Authored by: Anonymous on Tuesday, July 21 2009 @ 07:50 PM EDT
I does one's heart good to find out the IBM had the patience to wait for the
fatal miss-step. I thought it would never come.

[ Reply to This | # ]

Cautious Optimism
Authored by: snakebitehurts on Tuesday, July 21 2009 @ 08:11 PM EDT
I'll be there for the hearing. My son will be coming with me.

Before the last hearing, several of us were talking. I mentioned that people
around the world would be euphoric, or really mad, after the hearing. We know
how that went .....

I urge caution. I hope the stake is finally driven through the heart of the
vampire.

Mr. Spector is the master of "dancing". I've seen it over and over
again. He is REALLY good at it. Don't expect SCO to go down without a fight.
They always have a trick card to play.

I can already picture it - "Aw shucks Judge, with the speed of the deal
..... it was all just innocent mistakes ...."

The first time I saw Mr. Levin for IBM, I mentioned in a report that he was the
lawyer to watch out for. He is no nonsense, extremely confident, and to the
point. He is the biggest shark in the pool. He is beyond smelling blood. He
is lining up for the kill. We are now seeing that in full glory with his letter
to the court.

If the hearing takes place (after tomorrow's conference call), it should be a
wild one.

Thankfully, Judge Gross is already defining order in the courtroom with his
scheduling.

I hope to see others from the G7, and any others from here, at the hearing. We
start gathering about an hour before the hearing outside the courthouse. Coffee
is across the street.

MikeD

[ Reply to This | # ]

Sweet
Authored by: digger53 on Tuesday, July 21 2009 @ 08:39 PM EDT
May the hammer of justice strike home, now.

[ Reply to This | # ]

Speaking of "good faith"
Authored by: _Arthur on Tuesday, July 21 2009 @ 08:52 PM EDT
Maybe the time has come for the trustee to raise merry hell about the missing
Monthly Operating Reports, a bankruptcy DIP requirement.

Without MORs, any meaningful Reorganization Plan is impossible.

[ Reply to This | # ]

Is the fix in?
Authored by: Anonymous on Tuesday, July 21 2009 @ 08:59 PM EDT
Who would benefit?

[ Reply to This | # ]

Can Judge Gross call witnesses on his own?
Authored by: Anonymous on Tuesday, July 21 2009 @ 09:12 PM EDT
I wonder if IBM doesn't call Darl or Norris can the Judge call them?

[ Reply to This | # ]

Judge Gross in Deep Water, Bailing Fast
Authored by: Guil Rarey on Tuesday, July 21 2009 @ 09:27 PM EDT
The debtor has rights in a bankruptcy, but so do the creditors. In the last
hearing, the judge severely bent the rules in favor of SCO, over the direct and
strenuous objections of IBM and Novell. This wasn't just a judgment call within
his purview, this was actually moving well outside the rules.

Not only did Judge Gross get played for a fool by SCO, he's failed to protect
the creditor's rights and interests. I'm quite sure that IBM, implicitly or
explicitly made that point quite clear.

---
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

[ Reply to This | # ]

Bankruptcy expertise
Authored by: Anonymous on Tuesday, July 21 2009 @ 09:40 PM EDT
I think the new factor here is that SCOG has finally done something that is is
clearly understandable to a bankruptcy judge. Up to now, the judge was seeing
wierd stuff and attemptng to put it into the bankruptcy context, assuming good
faith. Now, he finally sees and instantly recognizes the symptoms of a desparate
DIP who set up a sham sale. This is a sadly familiar pattern for him, and he
immediately reacts because he is finally on familiar ground. If this analysis is
correct, the game is over on Monday.

[ Reply to This | # ]

    Alternative to Ch. 7 -- throw SCO out of his court?
    Authored by: Anonymous on Tuesday, July 21 2009 @ 09:46 PM EDT

    Could Gross could just decide to dismiss the petition and leave SCO
    to the tender mercies of Judge Kimball and a restarted IBM case?

    [ Reply to This | # ]

    Just out of curiosity...
    Authored by: JamesK on Tuesday, July 21 2009 @ 11:35 PM EDT
    What happens if SCO fails to produce the documents tormorrow as ordered?

    ---
    Self Assembling Möbius Strip - See other side for details.

    [ Reply to This | # ]

    Monday's Hearing if any
    Authored by: webster on Wednesday, July 22 2009 @ 12:36 AM EDT
    Monday's Hearing

    The hearing has been upstaged. The spectacular revelations have knocked the proposed sale off center stage. The improprieties have put SCO on the defensive.

    1. The Phone Call: This will be more interesting than the hearing. It may well preempt the hearing. SCO isn't going to like the parameters in this hearing. The order already tells them not to talk about the appeals. If there is nothing for them to gain, they should just concede to the conversion, or come in with a plan consisting of cash on the table, a few million. Even with that IBM will insist on knowing whose cash it is and if they are doing this to bury malfeasance. If SCO doesn't have their Motion for a sale or a plan, --with documentation, they have nothing to gain by participating in the hearing. This may well be established in the phone call.

    2. Risky Business: With or without a plan, the hearing is extremely risky for SCO players. One of the f-words is afoot. Even Gross can no longer presume SCO's good faith. Some money has been flowing fast and loose. They are paying their personal lawyers to tell them that silence is golden. They have been snookering the Court and finally even he knows it.

    3. Get real, SCO: A deal with Norris now is not going to happen. A deal arranged by Black Jack Darl is not going to happen. Unless there is a dramatic upheaval at SCO, and a PIPE Fairy Godmother arrives dressed as a White Knight bearing millions, there will be no sale. They should fall back and try and influence their new trustee in Chapter 7. Maybe he can be benumbed by code claims and spurred by his cut of billions.

    4. A complaint: The Court ought to tighten up its hearings. He lets the lawyers talk too much. It it were a jury, the Court would be instructing them that the comments and arguments of the lawyers are not evidence and should be disregarded as such. A half an hour opening per side is way too much. It should be a half hour for all sides. With motions already filed it doesn't take half an hour to tell the judge what you want and why you should have it. They could spend more time on testimony and contested factual issues.

    5. 800 Pounds: There is not going to be an 800 pound gorilla in the courtroom, but his droppings will be in the form of the stinking hundred thousand dollar payments to Norris by Black Jack Darl and the SCO affiliate, admitted by all. Norris is a paid poser who makes a lie of all previous SCO bankruptcy hearings. Black Jack Darl admits that he gambled by cheating and got caught. These will remain a pungent pile atop SCO's table no matter what they say. With no viable deal and no talk of the appeal what are they to say? How can they even argue against a trustee if they can't even control their own spending and affiliates. Poor Spector, a proud man whose posture will proclaim that you can't rely on anything he has said in this case. Let's hope he shows and does a good job.
    There's much more but it's late.

    ~webster~

    [ Reply to This | # ]

    What Price Fraud - What Value Honor
    Authored by: Anonymous on Wednesday, July 22 2009 @ 02:54 AM EDT
    Wednesday, 22 July, After 3:30 PM Eastern Time

    Will SCOGXQ.PK Finally Reach $ 0.03 Per Share

    [ Reply to This | # ]

    Owner of Unixs.de
    Authored by: Anonymous on Wednesday, July 22 2009 @ 03:18 AM EDT
    Didnt I see mention that SCO Germany was the owner of UNIXs.de and isnt this
    something worth mentioning to the judge as showing the whole thing is murky as
    well ?

    [ Reply to This | # ]

    Inviting direct testimony.
    Authored by: rfrazier on Wednesday, July 22 2009 @ 03:20 AM EDT
    In the order judge Gross seems to be inviting "direct testimony subject to
    cross examination of the witness".

    1. Isn't it like teaching your grandmother to suck eggs to remind folks that
    direct testimony is subject to cross examination? (Wonderful phrase,
    "teaching your grandmother to suck eggs". I tried it out on my
    grandmother once, asking if she would like egg sucking instructions. She was
    not best pleased. Apparently, she had no desire to suck eggs.)

    2. Why the invitation? To avoid even more letters from third parties saying how
    wonderful and useful is SCO stuff?

    Best wishes,
    Bob

    [ Reply to This | # ]

    Predictable, with hindsight
    Authored by: Doghouse on Wednesday, July 22 2009 @ 03:30 AM EDT

    For what it's worth, I don't share the apparently commonly-held view that this order is, in some way, Judge Gross "covering his posterior". Just as I wasn't, once I'd had time to think about it, exactly surprised that he bent the rules to give the latest "sale" at least an opportunity to fly. Nor do I necessarily think that descriptions of him as "furious" are necessarily accurate. This is simply one outcome of several that I have no doubt he'll have anticipated might come about even while he was signing the previous order.

    If you assume, as we have no reasonable right not to, that the Judge is a competent individual doing the job before him (and an intelligent one, given the nature of that job), then it's worth remembering what the purpose of Chapter 11 is - essentially, to give a struggling but potentially viable a legal haven and an opportunity to regroup and recover. That being the case, whilst we're all strongly aware of the sorts of games that SCO has played in its other cases, and even given the speed with which the previous two purchases melted away when pushed, he has a job to do. It's unreasonable to expect him not to feel that there might be mileage in allowing this purchase its day on the table. From the point of view of the Chapter 11 intent, it's a few more days elapsed on the one hand versus a possible successful rehabilitation on the other. But remember that he's also been around the block a few times, and seen a lot more and varied BK behaviour and practice than most of us. It's unreasonable and naive to think that he would have needed anyone to point out to him that the last-minute "purchase" might not hold up, or that it might even simply be sharp practice to game the system in some way. That being the case, it's pretty certain that he'll have been watching very closely since then, not just for whether or not the sale had a chance to fly, but also for any signs that things weren't as they seemed.

    So, I think it unlikely that he's currently "furious" - that's the sort of reaction you have when you're taken by surprise. But it's quite probably that, given the information that IBM has out in front of him, he's decidedly "not amused". Like many others here, I'd love to be a fly on the wall of today's meeting - I suspect that there will be some pretty blunt talking. And I also suspect that, could we but share it, it would also potentially be the most interesting session of this whole procedure.

    [ Reply to This | # ]

    Judge Gross Wakes Up: Order Re July 27th Hearing
    Authored by: jrvalverde on Wednesday, July 22 2009 @ 04:49 AM EDT
    Well, to me it looks more like the judge is fed up with SCO claiming an
    intangible while Novell and IBM keep nagging him with facts and work accumulates
    on his desk.

    Just like a busy father or teacher fed up with young children arguing would say
    "Stop bugging me, I'm gonna end this up now and I don't want any more of
    that nonsense".

    I bet he, like most other judges (or parents) will be overloaded with work, but
    must keep his patience all time nevertheless to do a good job.. until he is
    given a sound reason to stop all nonsense, at which point he will not reject the
    opportunity to get a nuisance off his shoulders to be able to go on with his
    business.

    It doesn't mean he's awoken to SCO's ways, only he's fed up with losing his
    precious time with sterile arguments. And so more surprises may still be ahead
    waiting for us.



    ---
    Jose R. Valverde
    EMBnet/CNB

    [ Reply to This | # ]

    • Self Interest - Authored by: Anonymous on Wednesday, July 22 2009 @ 11:29 AM EDT
    You all think you know what is going to happen next.
    Authored by: Ian Al on Wednesday, July 22 2009 @ 05:10 AM EDT
    Well, you're all wrong. On the 26th July the appeal court will surprise us all
    and return its judgement saying that Judge Kimball erred as a matter of law.

    The court will say that the licence for Microsoft cannot have been for UnixWare
    or OpenServer and must have been for SysV. Further, the court will opine that
    the licences not to sue must be seen in the light of official writings from the
    company's legal counsel to 1500 major companies saying that the basis for legal
    action against them was the use of SysV copyrighted code and that Linux users
    must get a SCOSource licence.

    The case will be passed back to Judge Kimball to reconsider the extent of SCOG
    conversion of Novell funds in this light an revise the sums owed.

    On the 27th, the court, all the lawyers and the general (and, the specific)
    public will sit in dumbfounded silence not knowing if criminal activities
    surrounding a sale that could not possibly happen is, in fact, criminal.

    Judge Gross will say 'I'm not leaving this court without sanctioning someone and
    I choose you, the clerk of the court'.

    The Grokreporters will return home in silence wondering if this is, in truth,
    just the grand finale of the current series or the final episode.

    ---
    Regards
    Ian Al

    Linux: Viri can't hear you in free space.

    [ Reply to This | # ]

    You may want to unplug the phoneline from your computer
    Authored by: Anonymous on Wednesday, July 22 2009 @ 06:13 AM EDT
    The court will be using the public phone system and there may be a lot of singed
    lines and switches before it's over. ;-)

    bobm

    [ Reply to This | # ]

    • No problem - Authored by: Anonymous on Wednesday, July 22 2009 @ 01:53 PM EDT
    OK, *NOW* IBM has swatted that pesky mosquito.
    Authored by: DaveJakeman on Wednesday, July 22 2009 @ 06:38 AM EDT
    And very shortly it will look squished.

    [ Reply to This | # ]

    Judge Gross and IBM may be one step ahead
    Authored by: Anonymous on Wednesday, July 22 2009 @ 08:41 AM EDT
    Everyones assumes that the 27th hearing will be mostly about the sale, not
    necessarily the conversion motions. After some thinking I'm not so sure about
    that.

    First of all, we don't yet know what issues IBM raised in their letter, we only
    see Judge Gross's reaction. So let's analyze that:

    1.
    He wants depositions from R. Tibbits and W. Broderick. I've no idea who the
    latter is and what they might have to say, but it might have to do with the sale
    motion. He wants those depositions by Thursday afternoon, so maybe he wants to
    use it on Friday.

    2.
    He excludes any evidence concerning the prospect of SCO's litigations. But how
    should such evidence promote SCO's sale motion? The prospect of litigation is
    much more relevant for the Chapter 7 conversion.

    So my take is that the sale is off anyhow and Judge Gross wants to make sure he
    can decide on the conversion motions on Monday without further delay. I wouldn't
    be surprised if he denied the sale motion on Friday already - after all the July
    15th hearing was about that, no? So maybe the Tibbits and Broderick depositions
    are just loose ends on that which he wants to tie on the 23rd, deny the sale
    motion on the 24th, hear the conversion motions on the 27th and have the
    conversion order on the docket by the 28th.

    /Andreas

    [ Reply to This | # ]

    How do you spell TOAST?
    Authored by: jim144 on Wednesday, July 22 2009 @ 09:47 AM EDT
    SCO

    [ Reply to This | # ]

    Judge Gross Wakes Up: Order Re July 27th Hearing
    Authored by: Anonymous on Wednesday, July 22 2009 @ 09:58 AM EDT
    Actually, I don't think Gross is out to save his butt. He can reasonably argue
    that the sale was an unusual circumstance.
    I think this proved to him beyond all reasonable doubt that there was no plan to
    really rehabilitate SCO and there is not going to be a plan.
    So now he is making sure that there will be no surprises for him for the hearing
    of the 27th. Maybe there will be surprises by him on that day, like sanctions
    for behaviour up to now if not properly explained away/remediated at the
    teleconference.

    [ Reply to This | # ]

    SCO vs. Linux: SCO funds for SCO investor
    Authored by: JamesK on Wednesday, July 22 2009 @ 10:03 AM EDT
    Here

    ---
    Self Assembling Möbius Strip - See other side for details.

    [ Reply to This | # ]

    So legal, so long!
    Authored by: AMackenzie on Wednesday, July 22 2009 @ 10:23 AM EDT
    It seems to me that this stroke by IBM has long been foreseen and planned. It's
    fairly obvious that, sooner or later, a firm in SCO's position is eventually
    going to do something naughty. IBM will have had detectives quietly stalking
    the major actors in the drama, circling the prey, waiting on exactly the right
    moment to pounce.

    How come they've waited so long? Presumably, SCO has kept within the letter of
    the law, at least until very recently.

    [ Reply to This | # ]

    Oracle Now Enters the Scene
    Authored by: RFD on Wednesday, July 22 2009 @ 11:30 AM EDT
    Oracle now wants Amish R. Doshi of Day Pitney, LLP to represent it. (#857)

    ---
    Eschew obfuscation assiduously.

    [ Reply to This | # ]

    Teleconference question
    Authored by: AndyC on Wednesday, July 22 2009 @ 11:39 AM EDT
    Do we get any news about the teleconference? I know they don't usually have
    stenographers (?) there to record things, but is there any way we can find out
    what went on?

    Andy

    [ Reply to This | # ]

    Future headlines
    Authored by: DodgeRules on Wednesday, July 22 2009 @ 12:01 PM EDT
    Ok, let's all put our thinking caps on (wishful, practical and possible) and
    come up with newspaper headlines which tell us in a nutshell what happens at the
    next Court hearing. Me first:

    "Darl offers to buyout SCO to avoid jail time"

    [ Reply to This | # ]

    Judge Gross Wakes Up: Order Re July 27th Hearing
    Authored by: Anonymous on Wednesday, July 22 2009 @ 03:11 PM EDT

    Perhaps IBM and/or Novell should now make an offer to buy ...

    [ Reply to This | # ]

    My prediction...
    Authored by: jacks4u on Wednesday, July 22 2009 @ 03:20 PM EDT
    IANAL, but some things seem strange to me:
      The Court urges the parties to consider and discuss the possibility of proffering direct testimony subject to cross examination of the witness.
    Which witness or witnesses? Could it be these two?
      b. Debtors shall either make available for deposition on July 23, 2009 (afternoon) Ryan Tibbits and William Broderick, or will not be permitted to have them testify
    Or some other person? perhaps Mr. McBride himself?

    Could it be that one or more of the parties would like evidence and testimony in a form that is complete enough to refer to a Grand Jury for criminal proceedings?

    Aside from fraud and conspiracy there may be others. any Criminal lawyers out there? or Bankruptcy lawyers? perhaps someone with more extensive legal knowledge will shed some more light on the possibilities?



    ---
    I'm not a Lawyer, this is my opinion only. I may be wrong, but I don't think so!

    [ Reply to This | # ]

    • My guess... - Authored by: Anonymous on Wednesday, July 22 2009 @ 06:15 PM EDT
    German corporate law holds the CEO liable?
    Authored by: Anonymous on Wednesday, July 22 2009 @ 03:29 PM EDT
    I am not familiar with German corporate law, but I recall
    from earlier Groklaw articles that the chief executive may
    be held liable for the actions of the company.

    Hans Bayer is not the CEO of SCO Germany, it is now Ken
    Nielsen, the "temp" CFO, and before that it was Jean
    Acheson, the accounting clerk who was promoted to
    Comptroller in 2007.

    I wonder how German authorities may treat a case of fraud,
    if it comes to that. CPAs with fraud convictions on their CV
    usually don't get the plum jobs.

    [ Reply to This | # ]

    Judge Gross Wakes Up: Order Re July 27th Hearing
    Authored by: perpetual_newbie on Wednesday, July 22 2009 @ 04:37 PM EDT
    Something simple and stupid just occurred to me.

    In the last deals with Stephen Norris Capital Partners, SCO asked the court to
    pay as a courtesy to the failed investors.

    If Darl was hiding behind all of these previous deals as it has been suggested
    he is behind this one, it would be a clear case of attempting to funnel money
    out of the debtor's purse and putting it directly into his.

    Or do I need to tighten my tinfoil hat again?

    [ Reply to This | # ]

    • Norris funnel. - Authored by: Anonymous on Wednesday, July 22 2009 @ 04:46 PM EDT
    Asking a Party about the Teleconference
    Authored by: Anonymous on Wednesday, July 22 2009 @ 05:04 PM EDT
    Would it be possible to ask one of the parties for an idea of
    the teleconference to understand what came out of it today?

    Would it be proper for IBM or Novell to share that?

    ---
    Clocks
    "Ita erat quando hic adveni."

    [ Reply to This | # ]

    Novell Objects to SCO's Assigments and Microsoft Pops in to Say "Hi!"
    Authored by: DaveJakeman on Wednesday, July 22 2009 @ 05:48 PM EDT
    Recently posted on Epiq:

    Novell objects to SCO's assignment of contracts, invoking the rights given to it
    under the 1995 APA, finally, and blocks SCO's underhanded bankruptcy dealings --
    as if SCO haven't done enough to block their own dealings themselves (with a
    little help from IBM). Worth a read.

    Also, Microsoft transfers their claim against SCO to another party. At this
    late hour, with deep investigation about to commence, one must wonder: why?

    [ Reply to This | # ]

    more bomb hells?
    Authored by: Anonymous on Wednesday, July 22 2009 @ 06:16 PM EDT
    IBM said in its motion that it was continuing discovery. Perhaps it will drop a
    few more bombshells at the hearing.

    [ Reply to This | # ]

    Bad Darl! No cookie for you! :)
    Authored by: SilverWave on Wednesday, July 22 2009 @ 07:22 PM EDT
    Wow when you do something stupid you really pull out all the stops.

    Nice.

    SCO is TOAST.

    ---
    RMS: The 4 Freedoms
    0 run the program for any purpose
    1 study the source code and change it
    2 make copies and distribute them
    3 publish modified versions

    [ Reply to This | # ]

    Judge Gross Wakes Up: Order Re July 27th Hearing
    Authored by: Anonymous on Wednesday, July 22 2009 @ 08:47 PM EDT
    Just got done reading these two gems, and I agree it appears Novell was easy on
    SCO in that they let the IBM filing say it all.

    But I have a question or maybe more of a statement.

    In the IBM depos, Norris admits that he had no backing lined up for Novell LC.
    If the judge had granted the sell right then and there, SCO and company would
    have been hosed as they had no money to deposit at close of business as they had
    claimed.

    Sill reading IBM but I now see why fraud is looking to be in SCOs, and maybe
    some other persons as well, future.

    IBM is not only saying SCO lied at that hearing, but did it so bold faced, that
    Your Honor is looking like a sucker

    [ Reply to This | # ]
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