IBM denies SCO's charges in intellectual property fight

Didn't do it. That's the clear message IBM sent with its reply to The SCO Group's $1 billion lawsuit in which it accuses Big Blue of illegally trying to damage Unix to build up Linux.

IBM categorically declared this week that it "has not engaged in any wrongdoing" and that, contrary to SCO's allegations, it hasn't misappropriated any trade secrets, engaged in unfair competition, interfered with SCO's contracts or breached any contractual obligations to SCO.

IBM filed its response Wednesday in the U.S. District Court for the District of Utah to SCO's lawsuit from early March (see story).

SCO is seeking damages of at least $1 billion for what it says are IBM's efforts to improperly destroy the economic value of Unix, an operating system that SCO owns and licenses to other companies, to bolster IBM's efforts around the Linux operating system.

Linux's kernel is developed by a team of volunteers worldwide, led by its creator, Linus Torvalds. This method of developing software is known as open source. The Linux kernel is freely available, and its different versions developed commercially by vendors such as Red Hat Inc. and SuSE Linux AG have gained wide acceptance as an option to desktop and server operating systems such as Microsoft Corp.'s Windows and Unix.

IBM in particular has made huge investments on Linux, to make its hardware and software compatible with the system.

In its complaint, SCO specifically charged IBM with contributing SCO Unix software that is trade-secret protected for incorporation into Linux and other similar open-source software.

SCO reiterated the allegation again today. The company has accumulated more concrete evidence over the past two months indicating IBM funneled SCO Unix code to Linux, said Chris Sontag, senior vice president and general manager of SCO's SCOsource, a division in charge of managing and protecting the company's Unix intellectual property. "We're finding out things that we consider extremely troubling," he said.

In particular, SCO has evidence of SCO's System V Unix lines of code showing up on the Linux kernel that were either copied verbatim or mildly disguised, Sontag said. SCO also has evidence of a third instance of intellectual property violations: There is code in Linux's kernel that was developed "with obvious access to our source code," Sontag said.

It will be impossible to assign guilt to a specific person for all the allegedly stolen code, but SCO does have evidence that implicates IBM as a whole, he said.

Sontag stopped short of saying SCO plans to expand its legal efforts to target, for example, Torvalds or Linux vendors such as Red Hat and SuSE. "We won't lay out our next steps right now, but we certainly have a plan of action and will move forward with doing those things that best protect our intellectual property rights," he said.

For now, its primary focus will be its action against IBM, Sontag said.

Should SCO prevail in court, the implications for the Linux movement and industry would be immense. For starters, the Linux kernel would have to be stripped of any code deemed by the court to be in violation of SCO's intellectual property, unless Torvalds decided to license it. This would have a domino effect throughout the industry, as vendors of Linux-based software and Linux users would be called to comply with new licensing requirements.

IBM addresses this issue in its response, by striking back at SCO and accusing it of "improperly seeking to assert proprietary rights over important, widely used technology and impeding the use of that technology by the open source community."

IBM also concedes very little to SCO, describing most of the lawsuit's allegations and statements as untrue or withholding comment due to insufficient information. It appears that the extent of the disagreements between the two sides could lead to a long and difficult legal process.

Particularly interesting are IBM's positions regarding SCO's claims of ownership over Unix. For example, IBM claims a lack of information to assert as true, among other things, that Unix was originally developed by AT&T Corp.'s Bell Laboratories; that AT&T used to license Unix to other companies; that AT&T licensed Unix to IBM; that all commercial Unix flavors in use today are based on SCO's System V Unix technology; that SCO owns the rights in and to all underlying, original Unix software code developed by AT&T Bell Laboratories; and that SCO is the authorized successor in interest to and the owner of all the contractual rights arising from the AT&T Unix agreements

"It's hard to believe the things they're claiming ignorance for," Sontag said. SCO often gets requests from IBM on behalf on IBM's clients that want to view the source code of AIX, IBM's Unix flavor. This indicates that there are groups within IBM who are aware of the contractual obligations IBM has to SCO as part of their Unix licensing agreement, Sontag said.

IBM also outright denies that its AIX flavor of Unix is a modification of SCO's licensed Unix. And it contests that the Utah court is the proper venue for the lawsuit, without saying which venue would be more appropriate.

"We strongly stand behind the claims we made in our initial filing," Sontag said.

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