SCO News Roundup

So we're halfway there, wherever 'there' is. I haven't seen any courtroom reports yet, but Al P. has the official minutes here.

The minutes mention that today SCO begged for something called "involuntary dismissal", which if granted would make the case go away, never to return. No word on what grounds (if any) they think this is justified. I suspect the details will be rather amusing.

Updated: GL's coverage of Day 2 is up now. Not much detail yet, though. PJ typically updates the existing article when new info arrives, instead of creating a new article, so it's worth checking back again later.

Until we hear today's news from SLC, here are some articles about yesterday's thrilling courtroom drama. Most are from local UT media, by reporters who've been covering the SCO saga for a while now. So I'd imagine they all attended the trial yesterday.

• Salt Lake Tribune: "Novell licensing beef with SCO tied to 1995 version of Unix"
  
• Provo Daily Herald: "SCO, Novell trial underway"
  
• Deseret News: "Novell says SCO owes it $20 million; SCO begs to differ"
  
• Server Watch: "Enterprise Unix Roundup: Law and Order, Unix Edition". In which the SCO case gets second billing behind the Hans Reiser trial & conviction.
  
• Lamlaw: "First Word from Day 1 of the Novell v. SCO Trial"
  

At GL, the story so far.

Based on the trickle of news so far, it ounds like we haven't come to the eventful part of the trial yet. Assuming there's going to be an eventful part. I still suspect SCO's going to weasel out of this somehow. I don't know how. I don't even have any serious guesses about how. But still, I'm not sure I'll believe this is for real until there's a verdict. And maybe not even then.

Until we hear anything further, here's today's batch of trial preview stories:

• InternetNews: "SCO Novell Trial Starts Today"
  
• Slashdot: "SCO v. Novell Goes to Trial Today In Utah"
  
• Deseret News: "Trial starts today in SCO lawsuit"
  
• Salt Lake Tribune: "SCO Group vs. Novell: New round"
  
• LocalNews8.com: "Novell turns tables on SCO Group"
  

Oh, and the Novell trial gets a quick mention in MOG's puff piece about the FranklinCovey deal. Btw, she says the FC deal is a "revenue-sharing" arrangement. Which (if true) means SCO only gets to keep a portion of any Me Inc. revenue from the deal, assuming said revenue ever exists. Somehow this is good news for SCO, though, probably because they're leveraging proactive synergies outside the box, or some damn thing.

So unless a miracle of the bad kind happens in the next few hours, tomorrow morning will see the start of the long-awaited, long-delayed SCO v. Novell trial. I can't believe it myself, but it really does seem as if they're prepared to go through with it this time. Both sides have filed trial briefs this time, although SCO's arrived in redacted form. It's not clear to me what they hope to gain by that; anything in the trial brief will presumably show up at trial a few days later. I suppose they might try to shoo spectators out of the courtroom for parts of the trial that involve ultra-double-secret Methods And Concepts -- assuming Kimball goes along, of course.

So PJ has a preview of how the trial "should" play out. I'm still not convinced, though. I can't think of a convincing scenario in which SCO delays the trial once again. I haven't seen anyone else come up with such a scenario, either. But I still don't quite believe it's going to happen.

This is what I suspect will turn out to be the key point: Tomorrow is merely the beginning of the trial, not the end. The thing's supposed to take four days, which means it might, or might not. And after those four days, Kimball will rule on the case at some indeterminate point in the future. And once that's happened, SCO's already promised to appeal, on the grounds that the (presumable) verdict is not what they had in mind when they first sued Novell, and they'd like a do-over, please.

The best possible outcome for SCO this week is to be found liable for $0, and that would be a bit surprising. If that happens, I imagine their stock might go up temporarily, and the Norris deal might go forward, and things will seem relatively peachy for a while... until it's time to go ahead with the IBM case.

A more realistic outcome is that SCO's found liable for some or all of the $30M Novell's asking for. There's been some discussion in the last few days about whether the $30M should go to Novell, or back to Sun & Microsoft. Truth be told, I don't particularly care, so long as SCO doesn't have it. If, as seems likely, SCO can't give any money back because they've spent it all on lawyers, it's not great news exactly, but it's still $30M they don't have anymore. So that's something, I guess.

Ok, this is a bit late, as usual. I got started compiling a list of news stories about the dead SNCP deal, and never quite got around to posting it. It'd be a shame for all that work to go to waste, I guess, so I'll attach that at the end in case you really feel like reading old news. But first, the new and newish stuff...

• As always, whenever SCO has actual product news I try to lead off with it. It's a thing with me, I guess. It's big news even when it isn't inherently big news, just because it's so rare anymore. At this point, whenever something new or updated hits the street, there's a chance it just might be the very last product SCO ever releases. So the latest out of Lindon is the colossal, stupendous Shout Postcard 1.1. Among the thrilling new features: It would run on more mobile phones if anyone wanted to; there's an audit trail to track what these hypothetical users use the software for, if anything; and it's available in Japanese, in the unlikely event anyone in Japan would be caught dead using a big, clunky American mobile phone. Still, as I said, big, big news
  
  
• In recent years there have been far more announced SCO products than released ones, so this item isn't quite as big news as the first. Seems that SCO's teaming up with Franklin-Covey for some sort of Me Inc. personal organizer / time management doodad. Eerily similar to the old DT4 app they promised and apparently never quite delivered as part of an erstwhile partnership with Day-Timers. Also eerily similar to the interweb-based Franklin Planner stuff Darl was in charge of during his own Franklin-Covey days.
  
  This announcement has actually gotten a bit of press, believe it or not. Stories at the Salt Lake Tribune, Telecommunications Magazine, techrockies, and TMCNet. Possibly this is all because Franklin-Covey stuff is a big deal in some quarters. Ok, so the TMCNet piece strongly resembles the press release, and the techrockies blurb is short. The other two are ok, though, and tell you probably everything there is to know about the deal. Unusually, the press release does have a quote from a VP at Franklin Covey, but the SL Trib story includes the line "Representatives of FranklinCovey did not return calls Tuesday seeking comment.".
  
  
• Ok, let's be honest here. You don't really care about SCO products, real or otherwise, and neither do I. Luckily there's stuff going on in the legal world too, so let's talk about that instead. In the BK case, April 21st was the cutoff date to file a proof of claim. Basically creditors were supposed to file a form stating how much money they want from SCO, or in some cases that they want an amount TBD later. You can explore all the filings here if you want to. A few highlights: Novell wants the $30M they intend to win from SCO, assuming SCO v. Novell ever goes to trial. IBM has a $0 placeholder claim for whatever they win from SCO, assuming SCO v. IBM ever goes to trial. SuSE asks for a bit over $1M over the Swiss arbitration, but says this is a preliminary number and notes the final one may be more like $50-100M. Sun (yes, Sun) also has a $0 claim, which reads as if they're threatening or preparing to sue SCO, presumably over their infamous SCOSource deal. Citi Financial wants $3M, but only if SCO stops supporting UnixWare 7.1.3. Amici (the infamous Boies tentacle) wants $440k for their usual "document handling" services. A former employee stakes a claim relating to a current age discrimination + harassment complaint. And the hits just keep on coming.
  
  
• On GL, a bit about SCO's latest monthly operating report, such as it is. Several GL readers of the accounting persuasion point out various inadequacies with the latest report. Although I have to admit I don't entirely grok what they're saying, not being of the accounting persuasion myself.
  
  
• The 23rd was the deadline for SCO to file its trial brief for the Novell case (Novell filed theirs back in September, prior to the original trial date). So far no sign of it, although I don't have a PACER account to check directly. Kimball's order setting the deadline & trial date mentions that filing a trial brief is optional. They may just be putting as little time and effort as possible into the case, with even the remaining optimists at SCO just hoping to get the thing over with so they can appeal and win those guaranteed gazillions, or whatever.
  
  
• Oh, and they've announced SCO Tec Forum 2008, so mark your calendars. Still in Vegas, still in August, but this year it's moved from the Mirage casino to the Planet Hollywood casino. Because, well, the Mirage has a BK claim against SCO for unpaid bills relating to last year's SCO Tec Forum. Including someone's $71 room service tab, if you can believe that. So it's off to a new casino this year. The announcement claims Stephen Norris himself will appear at the event, although I imagine that all depends on whether we ever see a revised SNCP deal, and whether the BK court goes along with the deal. The original deal proposal said NewNewSCO would unveil a shiny new business plan and a shiny new board of directors at Sco Tec Forum 2008. Without the deal, the event will probably be far less interesting. Rumor has it the annual meeting of SCO users and resellers will be held in parallel with the event. In the hotel bar. Last booth on the right. Although if things go badly in the courtroom, they may move it out to the parking lot, strictly BYOB.
  
  
  

---

So here are those old SNCP links I promised. FWIW.

• eWeek [SJVN]: Another SCO buyout stumbles
  
  
• E-Commerce Times: SCO's plan to rise from the ashes flickers out
  
  
• Daily Herald : SCO negotiating new Ch. 11 plan
  
  
• Deseret News: Insolvent SCO scraps its reorganization plan.
  
  
• And both last and hindmost,
• MOG's spin. Feh.
  
  

Um, as I was saying about that $100M buyout deal... well, deal's off, sorry. Seems that the chorus of vehement objections had the desired effect, and -- as it turns out -- there is actually a downside to utterly failing to meet the basic requirements of a bankruptcy reorg plan, like showing that the buyer actually has the money, and that you have some sort of business plan in hand so you won't be back in BK court again in a year's time. Stuff like that.

So they're insisting the deal isn't completely dead, and they're going to restructure it as a straight asset purchase instead of the initial intricate proposal (which I havek to admit I couldn't make head or tail of, myself). So maybe we'll hear from SNCP again. Although SCO's also never admitted that the DaimlerChrysler suit is lost for good, even though there's no longer any such thing as "DaimlerChrysler".

My personal hunch is that SNCP won't be up for another bite at the apple. Certainly not an asset purchase type of bite. The problem with any future asset purchase is the same thing that sank the York deal. SCO would have to come clean and state specifically exactly what it owns, and be able to prove it. They've gone to ridiculous lengths over the last 5 years to avoid doing that, and I doubt they'll start now. And this time around everyone's watching a bit more closely; already the BK trustee has cautioned them not to try selling anything they don't own. There's no way to spin that as a good sign, not that I can think of.

The really great thing about the deal falling through (other than, obviously, the deal falling through) is that there isn't enough time left to put a new deal together before the Novell trial. The SNCP proposal would've expired if it hadn't been approved by April 28th, the day before the trial, which suggests the numbers only penciled out if there was still some doubt about the outcome of the Novell case. If another deal appears in the future, which is far from certain, it will happen after the case is over, and Kimball decides how much SCO owes to Novell. That's going to change the whole landscape, and not in SCO's favor.

Now, if they'd filed a viable plan in a timely fashion and generally played by the rules, there might've been time to fix any deficiencies before the 29th, a.k.a. Doomsday. But instead they tried to railroad the thing through the BK court at the last minute, and now there's no time for a Plan B. Oh, well. C'est la vie.

I think SCO's main goal is to stave off the Novell trial in any way they can. That's what the BK filing was about, and that may be what the York & SNCP deals were both about. And they certainly weren't in a hurry to get the trial going before the BK filing, either. Unless they can find a way to get the BK stay reimposed in Delaware, I think the focus now shifts back to Utah, and figuring out if there's any last-minute way to game the system and push the trial date off a few more months. I'm not a lawyer (have I mentioned that yet?) so I don't know what their odds might be. My hunch is that they aren't good, though.

The news coverage of the latest twist ought to be good. I'll try to do another roundup tomorrow and cover at least the choice bits. I'm serious. Or if not tomorrow, at least some time soon, before the Novell trial at least.