The news that a judge has resuscitated SCO Group's $1 billion case against International Business Machines Corp. provoked a mixture of surprise and scorn on the tech blogs Monday. SCO's claims that it deserved damages from IBM and royalties from Linux users infuriated open-source proponents, and the case seemed to be going nowhere before a judge agreed to dust it off late last week.
The lawsuit, which dates back to 2003, centers on claims that IBM violated a licensing agreement by illegally sharing a part of SCO's Unix operating system that ended up being used in the popular Linux system. The case was administratively closed pending a decision on a related issue, namely whether Novell actually owned some of SCO's copyrights for Unix. Novell prevailed on that score in 2010, and in 2011 the U.S. Court of Appeals for the Tenth Circuit rejected SCO's appeal. SCO, meanwhile, declared bankruptcy in 2007, complicating the litigation.
Another (albeit much shorter) delay was caused by the latest judge assigned to the case. On Friday, U.S. District Judge David Nuffer in Salt Lake City admitted that he erred when he turned down SCO's motion to reopen the case back in April. Nuffer held at the time that a stay in the bankruptcy matter was still in effect, only to be informed by SCO's attorneys at Boies, Schiller & Flexner and Hatch, James & Dodge that the stay had been lifted. The motion to reopen the case wasn't opposed by IBM and its lawyers at Cravath, Swaine & Moore and Snell & Wilmer.
"The order was based on a fundamental misunderstanding of the effect of the SCO bankruptcy on this case," wrote Nuffer in a two-page order. "The court apologizes to the parties for its error and the unnecessary work it has caused the parties."
Now that the case has been revived, the first order of business is to sort out what's left of SCO's claims. In the Novell case, the Tenth Circuit ruled in August 2011 that Novell owns the Unix copyrights. Nuffer set a schedule for both parties to brief their positions on where the case stands. At the time the case was administratively closed, there were a number of summary judgment motions pending before the court.
IBM lawyer David Marriott of Cravath declined to comment. Stuart Singer of Boies Schiller, who represents SCO, also declined to comment.