Judge Says Unix Copyrights Rightfully Belong to Novell

By John Markoff
The New York Times

August 11, 2007

SAN FRANCISCO, Aug. 10 — In a decision that may finally settle one of the most bitter legal battles surrounding software widely used in corporate data centers, a federal district court judge in Utah ruled Friday afternoon that Novell, not the SCO Group, is the rightful owner of the copyrights covering the Unix operating system.

In the 102-page ruling, the judge, Dale A. Kimball, also said Novell could force SCO to abandon its claims against I.B.M., which SCO had sued. Judge Kimball’s decision in favor of Novell could almost entirely undermine SCO’s 2003 lawsuit against I.B.M.

The ruling could remove the cloud over open-source software like Linux, an operating system loosely modeled on the proprietary Unix. The unresolved ownership has been seen as a limiting factor in the willingness of computing managers for businesses large and small to adopt open-source software, which can be adapted freely by software developers and can be legally shared or modified by end users.

“It was argued that this was supposed to suggest riskiness in open source, but it turns out that the open-source world was rock solid from the beginning,” said Eben Moglen, a professor of law at Columbia University and the founding director of the Software Freedom Law Center, which advocates open-source software.

SCO’s shares declined by 1 cent, to $1.55, in after-hours trading. The company’s stock reached $19.41 after the lawsuit against I.B.M. was filed in 2003.

In that suit, SCO said I.B.M. had violated a contract by copying code from the Unix operating system to Linux, an open-source operating system that is distributed free and that I.B.M. uses on some of its computers.

SCO had said that Linux was an unauthorized derivative of Unix, which it said it had purchased from Novell in 1995.

“The court’s ruling has cut out the core of SCO’s case and, as a result, eliminates SCO’s threat to the Linux community based upon allegations of copyright infringement of Unix,” said Joe LaSala, Novell’s senior vice president and general counsel.

Executives for SCO did not immediately return phone calls on Friday evening.

The Unix operating system, which has become popular with some independent-minded PC users as well as in the corporate world, was developed by AT&T researchers at Bell Labs beginning in 1969. During the 1970s, the operating system became highly influential in academic computing and in computer science departments.

In the ’80s, it had a significant impact in the computer workstation and minicomputer markets, although it never gained a significant foothold in the personal computer business until Steven P. Jobs brought a version of Unix with him when he returned to Apple Computer in 1997. Some PC makers have begun to offer versions of Linux instead of Microsoft’s Windows operating systems.

Open-source software advocates said the ruling vindicated the open-source approach to software development.

“This is a meaningful message in terms of people adopting open-source software,” said James Zemlin, executive director of the Linux Foundation, a nonprofit consortium formed to foster the operating system. “This says that Linux is a safe solution and people can choose it with that in mind.”

Several legal experts said that minor legal questions might still remain in SCO’s suit against I.B.M., related to promises that I.B.M. may have made in a failed joint development effort.