Great news for the open-source community and for the long-suffering Novell (NOVL), which has been battling SCO for quite some time now.

“Novell is very pleased with the jury’s decision confirming Novell’s ownership of the Unix copyrights, which SCO had asserted to own in its attack on Linux,” the company said in a statement. “Novell remains committed to promoting Linux, including by defending Linux on the intellectual property front.”

Which is great, because SCO, while obviously struck low by today’s verdict, evidently intends to forge on with its suit against IBM (IBM), which it also claims misappropriated Unix and built it into Linux. Former U.S. District Judge Edward Cahn, the trustee for SCO’s bankruptcy, told the Salt Lake Tribune that the jury decision will not dissuade it from pursuing its lawsuit against Big Blue. Said Cahn: “The copyright claims are gone, but we have other claims based on contracts.”

Astonishing. As I wrote of SCO back in 2004:

“There’s a scene at the end of Martin Scorsese’s remake of ‘Cape Fear’ in which villain Max Cady, having been shot, stabbed, burned and beaten, continues to threaten his victims even as he’s drowning, handcuffed to a sinking houseboat. I think of that scene every time I read that SCO has filed another motion in its ill-starred copyright infringement suits.”

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Schwartz notes that the incoming court-appointed bankruptcy trustee for SCO Group fired Darl McBride, the CEO, on Monday. McBride had made himself a vilain in the world of Linux and open source software by suing numerous parties reselling or distributing the Linux operating system, including IBM (IBM), but also Daimler (DAI), claiming Linux infringes on Unix operating system rights that SCO acquired several years back.

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“On my birth certificate, under my father’s occupation, it says cowboy. So I will admit to being a cowboy, but not sue-happy.”

– Former SCO CEO Darl McBride, November 2003

Looks like Darl McBride, SCO’s “sue-happy cowboy” CEO, has seen his last roundup. In a new 8-K filing with the Security and Exchange Commission, the company reveals that under the order of a bankruptcy court, it has eliminated the chief executive officer and president positions and consequently sacked McBride.

Which means SCO’s seemingly endless legal campaign may have finally found its end. For though the company says it plans to pursue litigation against IBM (IBM) and Novell (NOVL), there seems little promise in it now. SCO is mired in bankruptcy. It’s evidently still unable to prove that Linux illegally contains its UNIX System V source code. And now it has fired the guy who devoted the past six years attempting to do just that.

And, frankly, SCO is better off for it. As Free Software Foundation General Counsel Eben Moglen once said, “As an amateur scholar of constitutional law, Mr. McBride is longer than he is deep.” And this does appear to be the case. Because despite vast swaths of evidence to the contrary, McBride always appeared certain that SCO had successfully defended its intellectual property in court.

“We’ve obviously overachieved on that objective,” McBride said of SCO’s efforts to defend against IBM’s alleged intellectual property infringements in 2004. “If I had to make this decision [to sue IBM] ten times over, the decision would be the same one ten times. Big Blue is no doubt a formidable opponent and we still expect to win. Keep your eye on the [court] filings. Over the coming year, one of the things that you’re going to see is that Big Blue has got big problems.”

Obviously, Big Blue wasn’t the one with the big problems.

“For the last several months, we have consistently stated and maintained that our System V code is in Linux,” McBride explained. “The claims SCO has are both broad and deep. These claims touch not just IBM but other vendors as well. They also touch certain industry consortia and corporate Linux end users. Our claims aren’t trivial. The violations of our intellectual property are not easily repaired. It is our intention to vigorously protect and enforce SCO’s intellectual property, System V source code and our copyrights. We’re now fully prepared to do that.”

And they did. SCO subsequently filed suit against IBM (IBM), auto giant DaimlerChrysler and a coterie of other companies, each time sounding the same theme: Our copyrighted UNIX code was illegally cobbled into Linux. You’re using it without a license. Pay up.

But SCO never specified exactly the Linux code it believes infringes on its copyrights, even in the face of repeated calls to do so from its defendants and the open source community. Indeed, it could be said that the company’s legal campaign against Linux was defined by its utter failure to prove that the open-source operating system contains any of its intellectual property. Certainly, that was the opinion of the U.S. District Court for the District of Utah, which found that the copyright to UNIX and UnixWare was owned by Novell. That decision drove SCO into bankruptcy and ended its high-profile legal attack on Linux.

But only for a time. Because a federal appeals court on Monday ruled that SCO is entitled to a jury trial on its claims to Unix, a ruling that might lead to a renewal of the company’s campaign against Linux. “We take no position on which party ultimately owns the Unix copyrights or which copyrights were required for Santa Cruz to exercise its rights under the agreement,” the court wrote in its ruling. “Such matters are for the finder of fact on remand.”

And so, astonishingly, this six-year battle is headed back to court once again, a development Darl McBride was quick to spin as a vindication in one of his typically pontifical pronouncements. “Today is not the end of the war but it certainly is a key battle that we’ve won,” he said of the decision. “Now it’s time to move on to the next series of battles with our victory in hand.”

Of course, for events to play out that way, SCO must prove that Unix contains its intellectual property, something it has so far failed abysmally to do. Indeed, the judge presiding over the original case compared SCO’s claims to those of a store owner accusing someone of shoplifting but refusing to say what items had been stolen. As Linux creator Linus Torvalds once said, “There really is a reason why nobody believes a word SCO is saying, and it’s because SCO is lying.”

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That’s some heavy rhetoric. Certainly, it’s representative of the distaste with which Microsoft (MSFT) has viewed Linux and Linux vendors like Novell (NOVL) for the past decade.

So to hear back in Nov. 2006 that Microsoft was partnering with Novell to offer sales support for Novell’s SUSE Linux and cooperate with its old rival on Linux-Windows interoperability was astonishing–a bit like discovering that Stalin really sent Trotsky to Mexico for a nice vacation or that Itchy has shacked up with Scratchy.

And the unlikely partnership continues to astonish to this day. On Wednesday, the two companies expanded their interoperability agreement, with Microsoft agreeing to buy and resell up to $100 million in enterprise support subscriptions for Novell’s SUSE Linux Enterprise Server OS. That’s in addition to the $240 million Microsoft has already agreed to buy.

Odd, isn’t it, to see Microsoft marketing Linux like this? Odder still, to see Novell in an alliance with the company that hoped to “slaughter” it. So why did Novell agree to it? “Novell’s benefit is obvious, if not self-destructive,” Joe Wilcox explains over at Microsoft Watch. “The deal allows Novell to exist in the shadow of Windows Server, sustaining on its table scraps. Microsoft can offer customers that simply must have some Linux servers a sanctioned source for good tools ensuring interoperability with Windows Server.”

That’s some heavy rhetoric. Certainly, it’s representative of the distaste with which Microsoft (MSFT) has viewed Linux and Linux vendors like Novell (NOVL) for the past decade.

So to hear back in Nov. 2006 that Microsoft was partnering with Novell to offer sales support for Novell’s SUSE Linux and cooperate with its old rival on Linux-Windows interoperability was astonishing–a bit like discovering that Stalin really sent Trotsky to Mexico for a nice vacation or that Itchy has shacked up with Scratchy.

And the unlikely partnership continues to astonish to this day. On Wednesday, the two companies expanded their interoperability agreement, with Microsoft agreeing to buy and resell up to $100 million in enterprise support subscriptions for Novell’s SUSE Linux Enterprise Server OS. That’s in addition to the $240 million Microsoft has already agreed to buy.

Odd, isn’t it, to see Microsoft marketing Linux like this? Odder still, to see Novell in an alliance with the company that hoped to “slaughter” it. So why did Novell agree to it? “Novell’s benefit is obvious, if not self-destructive,” Joe Wilcox explains over at Microsoft Watch. “The deal allows Novell to exist in the shadow of Windows Server, sustaining on its table scraps. Microsoft can offer customers that simply must have some Linux servers a sanctioned source for good tools ensuring interoperability with Windows Server.”

Such anti-Linux declarations being biannual, it’s clear we were about due for another one, which Ballmer dutifully provided last week at a company event in the United Kingdom.

… Our battle is not sort of business model to business model. Our battle is product to product, Windows versus Linux, Office versus OpenOffice.
The only other thing I would say that is probably germane is, we spend a lot of money, the rest of the commercial industry spends a lot of money on R&D. We’ve spent a lot of money licensing patents, when people come to us and say, ‘Hey, this commercial piece of software violates our patent, our intellectual property,’ we’ll either get a court judgment or we’ll pay a big check. And we are going to–I think it is important that the open-source products also have an obligation to participate in the same way in the intellectual property regime.

“That’s why we’ve done the deal we have with Novell, where not only are we working on technical interoperability between Linux and Windows, but we’ve also made sure that we could provide the appropriate, for the appropriate fee, Novell customers to also get essentially the right to use our patented intellectual property. And I think it’s great the way Novell stepped up to kind of say intellectual property matters. People who use Red Hat, at least with respect to our intellectual property, in a sense have an obligation to eventually compensate us.”

So according to Ballmer, if you’re a Red Hat customer you may have an “undisclosed balance-sheet liability” to deal with in the near future. And if you’re not, you probably want to stay away from free software entirely. Because, as Groklaw’s Pamela Jones suggests, Microsoft apparently plans to eradicate it.

Ballmer “has just clearly outlined how Microsoft intends to extinguish Linux as we know it,” Jones writes. “Microsoft knows full well that in any intellectual-property regime based on software patents, particularly when used as weapons against innovation to protect and reward the old, no one can compete with Microsoft. They have all the money. FOSS is written by individuals who don’t have a pile of gold under the bed to go to court and get a court judgment or pay ‘a big check.’ Ballmer of course knows that. So this is the anticompetitive plan, under the guise of everyone having to play by the same rules.”

When a company begins characterizing its assets as merely “those remaining,” as the SCO Group did earlier this year, bankruptcy is an inevitability. So it comes as little surprise to learn that the company’s hard-fought, but ultimately ludicrous, four-year legal campaign against Linux has ended in a Chapter 11 filing. Seems using litigation as a profit center to compensate for market losses isn’t such a grand idea after all.

“The Board of Directors of the SCO Group have unanimously determined that Chapter 11 reorganization is in the best long-term interest of SCO and its subsidiaries, as well as its customers, shareholders and employees,” the company said in a statement, adding that it has filed a petition for reorganization in addition to the Chapter 11 filing. SCO said the filings will help ensure that it “will not have any interruption in maintaining and honoring all of its commitments to its customers” and will allow it to pay its vendors.

The reorganization, it claims, “ensures business as usual.”

It’s worth noting, however, that the preceding is a “forward-looking statement.” And as we all know, those often involve risks and uncertainties that could cause actual results to differ materially from those anticipated …

(Darl McBride image courtesy Bill Stearns)

Under the leadership of then-CEO Michael Robertson, the company proved an unyielding and wiley opponent–a gadfly that mounted a challenge to the validity of the Windows trademark on the self-evident grounds that the word “windows” is a generic term for a category of products–you know, like windows. The battle between the two companies raged for years, peaking in 2003 when Lindows announced the “MSfreePC” program–a service that allowed Microsoft customers living in California to claim more quickly their rightful portion of the software maker’s $1.1 billion antitrust settlement by giving Lindows the right to collect that money on their behalf, in exchange for a free PC and some Lindows software. It was an ingenious little marketing initiative, and one that no doubt inspired some chair-tossing up in Redmond.

In 2006 Microsoft agreed to pay Lindows $20 million to end its campaign to invalidate the valuable Windows mark and to change its name to Linspire, an easy concession when the world’s biggest software company is cutting you a check for a sum nearly 10 times your 2003 revenue.

Anyway … As of yesterday, all those years of legal sparring are behind the two companies, which entered into another of the Linux patent covenants that Microsoft has been peddling since its hell-freezing agreement with Novell. Like others that have come before it, the agreement will shield Linspire customers from Microsoft’s patent claims. Additionally, it calls for Linspire to work with Novell and Microsoft to develop open-source “translators” that allow OpenOffice and Microsoft Office users to share documents more easily.

Quite a turnaround, yeah? But as Linspire CEO Kevin Carmony told me, it’s more a sign of the times than anything else. “In the early days of Linux, we had no choice but to bang the ‘fight Microsoft’ drum (and as you know, no one did it better than Linspire), because we needed to get everyone’s attention, including Microsoft’s, and to be honest, back then, Linux didn’t work very well on the desktop, so it was pretty much the only thing we could find to say about it to get attention,” Carmony explained. “That’s no longer the case today. Microsoft has a better understanding of what Linux and open source is, and how to work in a cooperative manner with Linux, and we have a lot more interesting things to talk about.

“It’s time to move past all of the idea that for Linux to succeed, Microsoft must fail,” Carmony continued. “We need to let it go, and start working with all the players in the PC ecosystem, and that certainly includes Microsoft. I can’t speak for the rest of the Linux and open-source community, but from Linspire, you can expect less fighting and name-calling, and more attention to partnering to build a better Linux. We will certainly still compete, just like Apple and Microsoft still compete aggressively, but we’ve also built a bridge to work together when necessary. There are those who want to isolate Linux from the other 99% of the desktop computing world, and if they succeed, Linux will never grow past 1% of the desktop market. I want to see Linux move in the opposite direction, and rather than be exclusive, more inclusive.

“Bottom line, this was a market-driven agreement. I’m excited that we have a model in place, that moving forward, we can collaborate with Microsoft, with both of us having an incentive to see the other succeed. ‘Coop-petition’ is a healthy thing for the PC ecosystem.”